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No Real Business Asks for Gift Cards: The FTC's Warning Signs

Anyone who tells you to pay with a gift card is running a scam, says the FTC. The data, the stories scammers use and what to do if you already paid.

By DealsDMV Team · · 4 min read

If anyone tells you to pay with a gift card, it is a scam. That is the Federal Trade Commission's (FTC) message, and its consumer advice page goes further: no real business will tell you to buy a gift card to pay them, and government agencies never ask for payment by gift card. For a shopper, buyer or seller dealing with strangers, it is one of the clearest rules in the book.

Gift cards are for giving. The moment someone asks for one as payment, the deal is over.

The numbers I can open are from 2021, so I am treating them as a snapshot of how the scam works, not a current total. (For the latest overall figures, see $15.9 billion lost to scams in 2025.)

What the FTC data showed

In a data release dated 8 December 2021, the FTC reported figures for the first nine months of 2021:

MeasureFigure
Money consumers reported losing to gift card scams$148 million, already more than all of 2020
Consumers who reported paying a scammer this wayNearly 40,000
Trend since 2018Both the number of reports and the losses rose steadily
Median lossRose from $700 to $1,000 since 2018

The FTC also found that scammers most often posed as large companies or government agencies.

Why scammers love gift cards

This is my reading, not the FTC's wording. A gift card is quick to buy and does not need the scammer's name or bank account. Once the numbers are read out over the phone, the money can be spent. That fits the FTC's guidance for people who have already paid, which starts with speed.

The warning signs

The FTC's consumer page lists these signs of a gift card scam:

  • Urgency. The caller demands immediate payment and discourages you from pausing or talking to someone you trust.
  • Specific instructions. They tell you which card to buy and where, may stay on the phone while you load money or send you to several stores.
  • Requests for details. They ask for the card number and PIN, or a photo of the card.
  • Familiar stories. Government impersonation, tech support, a fake family emergency, a prize you must pay to claim, a utility shutoff threat, a romance contact, or an overpaid check you are asked to partly refund on a gift card.

Notice the last one if you ever sell anything online. A buyer who "overpaid" and wants a gift card back is not a buyer.

What real organizations never do

According to the FTC page:

  1. Government agencies won't demand immediate payment and never ask for payment by gift card.
  2. No honest business or agency will require a gift card to pay a fee for a prize.
  3. Utility companies don't threaten immediate shutoff to collect payment this way.
  4. The FTC itself never threatens you, says you must move money to "protect" it, or tells you to withdraw cash or buy gold.
  5. No real business will tell you to buy a gift card to pay them.

If you have already paid

The FTC's steps, in order:

  1. Report it to the gift card company right away, however long ago it happened.
  2. Ask for your money back. Some companies may refund you and some can freeze the funds if they are still on the card.
  3. Report it to the FTC at ReportFraud.ftc.gov.
  4. Keep the card and the store receipt for these steps.

Getting the money back is not guaranteed. The FTC's 2021 release says to contact the gift card company to try to stop payments to scammers, and that the FTC itself will never demand money, make threats, tell you to transfer money or promise you a prize.

Buying gift cards safely, as gifts

The FTC's tips for buying them as gifts: buy only from stores you know and trust and avoid online auction sites, where cards may be fake or stolen. Check that protective stickers are intact and the PIN isn't exposed, and report tampered cards to a cashier or manager. Photograph the card and your receipt.

Where this fits in everyday shopping

A seller who asks for gift cards, wire transfers or crypto is giving you the answer before you ask. The pattern is the same one we described in the payment method scammers ask for. If an order does not arrive, our guide to the FTC's 30-day rule explains your rights.

To see how DealsDMV takes payment, read the help page. It is the source of truth for the shop's own process.

The bottom line

Gift cards are not a payment method. The FTC says a request to pay with one is a scam, and the 2021 data shows how much money is lost this way. Pause, talk to someone and use a payment method you can dispute. If you've already paid, call the gift card company first.

If you have a relative who gets odd phone calls, send them this.

Sources

  1. FTC: FTC data show major increase in gift cards as scam payment method (8 December 2021) (ftc.gov)
  2. FTC Consumer Advice: Avoiding and reporting gift card scams (consumer.ftc.gov)

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