iTunes Gift Card Scams Are Flourishing

itunes-gift-card-scam

iTunes gift cards have become a common tool for online scammers to wring money out of victims, according to new warnings from Apple and U.S. federal authorities.

One agency received a deluge of complaints during a recent weekend, including word from one victim who lost $31,000 in a recent iTunes payment scam, according to the Federal Trade Commission.

The agency said the problem has grown so bad that Apple recently posted a notice on its gift card page:

“iTunes Gift Cards are solely for the purchase of goods and services on the iTunes Store and App Store. Should you receive a request for payment using iTunes Gift Cards outside of iTunes and the App Store please report it at ftc.gov/complaint.”

Apple did not immediately return a request for comment.

Criminals convince victims to buy iTunes gift cards, either online or in a store, and then email the secret code so the value can be drained — or traded.

“As soon as you put money on a card and share the code with (scammers), the money’s gone for good,” the FTC warned in a blog post.

Karen S. Hobbs, an attorney with Federal Trade Commission’s Bureau of Consumer Protection, said scammers like iTunes gift cards because they are “cash-like” in a few critical ways. It’s pretty hard to reverse an iTunes payment — unlike a credit card payment — and movement of iTunes dollars can be virtually untraceable. (See more reasons consumers fall for scams here.)

With any fraud scheme — from sweetheart scams to fake IRS tax bill scams — a criminal’s biggest challenge is getting paid. Wire service payments are their preferring method, because wire payments are generally impossible to reverse. But apparently consumers are slowly heeding warnings about wire services, leading criminals to turn to other payment methods.

iTunes gift cards aren’t the only alternate money system scammers have adopted. The FTC warns that they are using Amazon gift cards, PayPal, reloadable cards like MoneyPak, Reloadit and Vanilla, too.

Of course, criminals aren’t using the iTunes gift cards to feed their voracious appetite for music. They sell the cards on thriving gift card black markets, where iTunes cards — all cards, really – can sell for pennies on the dollar. Still, that gives criminals a great way to receive funds from victims and quickly cash them out.

“I think most people are surprised about the black market for iTunes cards,” Hobbs said.

It seems a bit far-fetched that consumers would believe the IRS, or any government agency, would ask for payment via iTunes “bucks.” But clearly, people are falling for the tactic.

“In some cases, (criminals) stay on the phone (with victims) while they go to the store and buy the gift cards, talk them through it,” Hobbs said.

The trend is international, too. Here’s a story about a similar tactic working in the United Kingdom: a criminal tricks a victim into believing she has a big tax bill that must be paid immediately.

“One victim is revealed to have purchased over 15 iTunes gift cards from Argos – each one valued at £100 – and handing over the codes to scammers on the phone. Another victim shelled out an incredible £15,000 on iTunes gift cards after receiving a cold call, the codes for which went straight to criminals,” TrustedReviews.com wrote on Friday.

One reason these scams might be working: Apple and iTunes are both recognizable brands, and criminals may be borrowing a bit of their “halo effect” to gain credibility.

So the big message the agency is trying to deliver is simple: “If you’re not shopping at the iTunes store, you shouldn’t be paying with an iTunes gift card,” the FTC says.

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Image: AnthonyRosenberg

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Man Allegedly Uses Stolen Credit Cards to Buy $9K in Chick-fil-A Gift Cards

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That’s one way to EAT MOR CHIKIN.

A man in Texas allegedly stole credit cards to stock up on a near-unlimited supply of chicken nuggets and waffle fries, purchasing a total of $9,000 worth of Chick-fil-A gift cards over the span of two days.

Police in Austin, Texas, arrested David Ricketts, 26, on May 6 after employees called and reported a man they believed was using stolen credit cards.

According to reports, Ricketts attempted to use multiple credit cards that day to buy about $2,000 worth of gift cards. Investigators also later found he’d purchased $7,000 in gift cards from the same restaurant two days before.

So how much chicken would $9,000 buy at Chick-fil-A? Even if Ricketts were to purchase the large version of every item on the menu, plus each kid’s meal, he’d still have about $8,750 left to spend, or enough for 35 more visits making that same full menu purchase.

Ricketts probably won’t get his Chick-fil-A fix any time soon, though. He is currently being held on a $15,000 bond and faces forgery and credit card abuse charges. After this incident, Chick-fil-A will require all customers to show ID if they want to purchase gift cards with a credit or debit card.

In today’s digital age, identity thieves don’t need a physical credit card to go shopping. That’s why it’s a good idea to check your credit card statements for anything strange — like gift certificate charges at Chick-fil-A. (You can also view your free credit report once a year from AnnualCreditReport.com and see two of your credit scores for free, updated monthly, on Credit.com.)

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There’s a Website That Will Break Up With Someone for You

break up with someone

A new service called The Breakup Shop aims to help non-confrontational people dump whoever they’re dating. For as little as $10, they can get the job done by text or email, replacing a task nearly everyone does for free currently.

Like Cards Against Humanity’s Black Friday prank, in which people paid $5 to literally get nothing, The Breakup Shop proves there’s a market for everything.

Of course, value depends on what your time is worth. You could agonize over a breakup, so outsourcing may be more efficient. Or perhaps you’re thinking, “I can do this for free!” even though DIY projects rarely turn out the way you want. “Let us handle the messy work of the breakup, so you can spend more time swiping right,” the company says, referencing the dating app Tinder. You’re busy, and a failing relationship is a poor investment!

But why invest in something that’s losing its value? The Breakup Shop sells gift cards for a steady supply of streaming at $40 and up, packages of Chips Ahoy cookies for $6, and poo-scented breakup cards for $10. There are even nearly $100 gift packs that come with a vessel—called the Memory Oven—for dumpees to burn mementos.

If you want to break up in a more frugal way, you can take the ghosting route like Charlize Theron. There’s a conflict-avoiding option for every budget—you just have to find it.

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