One of the more common ways people are scammed out of their money these days is through gift cards. That may sound bizarre, since buying goods with a gift card just adds another layer of work for a scamming ring. But that extra work is well worth it for the safety of the scam, because the transactions involved are anonymous.
In the story of Mae, a real victim who doesn't share her last name, the elderly woman was frightened into withdrawing her savings from her bank, and using it to buy bitcoin. She didn't understand bitcoin, but did as she was told, then the transaction failed because someone at the other end recognized a scam. So the scammers directed Mae to buy gift cards. Mae was never told to give the cards to anyone, because all the scammers needed were the serial numbers or barcodes.
See, retailers rarely have any idea who buys gift cards. They also have no idea who is spending them. And gift cards are not regulated the way banks or credit cards are. In fact, gift cards are exempted from the Consumer Financial Protection Bureau's consumer protection rules for fraud. Retailers object to regulation because they made money off these cards. But it provides an extra layer of privacy for the scammers. Read what happened to Mae, and how gift cards are the perfect route for separating people from their life savings at the Conversation.
(Image credit: Mike Mozart)