Gift card scams affecting Canadians across the country

Warnings about a gift card scam Shoppers who buy gift cards find the bar code is compromised by scammers and the cards are worthless. CTV's Dave Charbonneau reports.

Canadians are being warned about a gift card scam that is happening across the country, which involves the manipulation of the bar code on the back of the card.

Gift cards are a popular choice during the holidays due to their convenience and ease of use. However, they are also vulnerable to fraud. The Retail Council of Canada estimates losses of $3.8 million in 2021 due to gift card fraud.

Joshua Findlay, a victim of a gift card fraud, said, "I'm no longer buying gift cards ever again."

Four months ago, he purchased an Amazon gift card from a local grocery store. When the person he gifted the card to tried to use it online, there was no money on the card. When Findlay spoke to the store about the issue, he was told that the card had already been used and that they do not refund gift cards.

Nichelle Laus, a former police officer, explains how gift cards are manipulated.

"So what those sticker barcodes are, are of a card that they already have at home. That's basically loadable," she explained.

She says scammers take the cards home, put the stickers on, and hang them back up in the stores. The victim then pays for the card at the cash, but the funds end up on the card the scammer has at home that is linked to the sticker barcode.

Laus also almost fell victim when purchasing a PlayStation gift card. When she went to the cash register, the cashier scanned the card and it came up as an LCBO card.

Debbie Smith, another victim, received an Amazon gift card as a gift. The cards usually have a 16- or 30-digit claim code on the back, but hers was blank. She said, "The card had been glued back into the cardboard packaging. I could not tell that it had been used before."

Large grocery chains and retailers are aware of gift card fraud. Both Loblaw and Sobeys have said that their staff are keeping a keen eye on transactions to identify any tampered gift cards.

In a statement, Sobeys said, "We are aware of fraudulent tampered cards as an industry wide issue. Our teammates have been trained to proactively identify tampered gift cards where possible."

Jeff Horncastle, a client outreach officer at the Canadian Anti-Fraud Centre, advised that if you think you have been a victim of a scam, it is important to report it to your local police and the Canadian Anti-Fraud Center. He also noted that even if you have been targeted by fraud but have not necessarily been a victim, you can still report it to the Canadian Anti-Fraud Centre.

One way to avoid being scammed is to send a virtual gift card, which is sent directly to the recipient's email. If you still want to give a physical gift like a gift card but don't want to risk it being tampered with, you can always opt for cash.