Have you been asked to be a part of a white elephant or Secret Santa gift exchange this year? These types of gift exchanges can be a ton of fun, whether they’re held at the office or among friends.
Well, a new scam is capitalizing on the lighthearted nature of those gift exchanges. It promises that you’ll receive dozens of gifts from strangers if you sign up but then leaves participants high and dry. It’s just one of many scams that have popped up recently thanks to the pandemic and economy.
If you’re a fan of Secret Santa parties, you need to be wary of participating in these kinds of holiday-themed events with strangers. Let’s take a look at what the gift scam is, how it works and how to avoid it.
The gift exchange scam
Everyone loves a Secret Santa party. Who doesn’t want to open a cheap clock radio or a hand-knitted pair of mittens from a coworker? It’s some of the most fun you’ll have at work.
Don’t let that love of gift-giving (and receiving) get in the way of educated decisions, though. The Better Business Bureau (BBB) is warning of a scam that works much like a Secret Santa exchange, but in this case, you’re not asked to buy small gifts for coworkers. You’re asked to exchange gifts among people online you haven’t met instead.
Sounds innocent enough, but it’s not. This scam originated years ago, and it works more like a chain letter or pyramid scheme than a real gift exchange. It carries heftier consequences, too, because these types of exchanges are considered illegal by USPS.
Here’s how the scam works. This scheme is often geared toward women and starts with a convincing invitation. These are sent either by email or social media, normally through Facebook, and they tend to play into the idea of this being a fun, sisterhood-supporting thing to do.
Typically you’ll be asked to provide your name, address and other personal information to sign up in most cases. You’re then asked to provide info on a few friends. That info will be added to a list with other strangers from the internet.
Once you’ve provided that information, you’ll be asked to send a gift or bottle of wine to a stranger — along with their friends, family or contacts. See where we’re going here? You’ll ship gifts to unknown people in the hopes that they’ll return the favor and send gifts to you, too.
As you may have guessed, the favor isn’t always returned. Like with other pyramid scams, you need to recruit, recruit, recruit and keep things moving, and there’s an endpoint where people stop participating. Once that happens, people will be left without gifts after they’ve shelled out money to buy and ship gifts to strangers.
That’s not the only risk either. You’re also being asked to send out personal information to be on these lists. All it takes is a few pieces of information for criminals to drag you into other scams or steal your identity, so it isn’t wise to hand out this information online.
These types of pyramid schemes are also illegal in the U.S. and Canada. The U.S. Postal Inspection Services considers these gift exchanges to be a form of gambling. That means you could be subject to penalties such as jail time, fines or a lawsuit for mail fraud if you participate.
How to avoid these types of scams
Don’t get suckered into a gift exchange on the premise of fun or supporting other women. It probably won’t work out like you’re hoping it will. Avoid these schemes at all costs instead.
Your best bet is to just ignore any of these invites that land in your email or Facebook page. They may sound fun, but the risks are real.
Things that sound too good to be true almost always is, so be wary about any iteration of this scam. Do your homework, go with your gut and if something feels off, run away.
You can also report these types of social media posts. The process is straightforward on Facebook. Click the three-dot menu on the upper-right corner of the post and then select Find support or report post. Follow any on-screen instructions from here.
And, as always, don’t give your personal information (or others’ personal info) out to strangers on the internet no matter what they promise in return. That’s just asking for trouble that you don’t need.
It’s best to stick with giving gifts the old fashioned way. Need help finding the perfect gifts this holiday season? Tap or click here for 15 early Black Friday deals that are great for anyone on your shopping list.