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Gift Card Scams Find New Victims. Are Stores Doing Enough?

American families lost more than $40 million to a sophisticated gift card scam last year. Some victims say retailers should do more to protect customers. Chris Chmura reports.

NBCUniversal, Inc.

When the U.S. first launched into space, Max Atkinson's electronics handiwork was often aboard.

"Any program I ever worked on was a total success," he said from his home in Santa Clara.

Logic and critical thinking guided every NASA blastoff. But recently, the retired rocket scientist gave in to his emotions.

"I fell for it, and regret it ever since," Atkinson said.

Max and his wife Jennie were scammed when Max took a call from a man who claimed to be a police officer. The caller said their granddaughter caused a car crash, and needed money to get out of trouble.

The convincing scammer claimed "To get this going, we need $4,000," Max said, retelling the scammer's unnerving words. "It sounded so believable."

Hook, (phone) line, and sinker.

The impostor police officer told Atkinson to go to Macy's and buy gift cards, then call back with the redemption numbers for each. Atkinson did -- three times, in one day. He didn't suspect a thing until the following morning.

"The same guy calls me, and he says he needs more money," Atkinson said. "Instantly... it's just indescribable. You've been suckered. You've been scammed."

By then, Atkinson had already lost $12,000.

Of course, his granddaughter wasn't in any trouble. But when word of the scam reached Rachel Yoshida, she was heartbroken -- and angry.

"When I heard it was $12,000, I was devastated, truthfully," Yoshida said. "I can't understand how you would ring up $4,000 in gift cards from somebody who's in their eighties, and it not raise up some kind of flag."

Yoshida's grandparents are not alone. Scammers using similar tactics targeted an 88-year-old heart surgeon and grandfather in Oakland. His daughter, Lisa Hardy, said scammers called her father and said his grandson had been arrested.

"They hit him at his most vulnerable," Hardy said.

The callers demanded $3,000 in gift cards -- this time, from Best Buy. Hardy says her father rushed to an Emeryville Best Buy store in a panic, and paid cash for the gift cards.

"No one talked to him," Hardy said. "They let him spend the money."

Crooks operating these so-called "family emergency scams" raked in at least $41 million in 2017, according to the U.S. Federal Trade Commission. The number of victims who paid these phony ransoms has jumped 270 percent.

Hardy says retailers should warn shoppers.

"They really need to have some type of a policy where they limit the amount of gift cards that you're allowed to buy in any single transaction," she said. "For sure, counsel people. Nothing that is this important should be this urgent, and nobody took any time to stop this."

Some stores do take extra steps to prevent customers from falling for gift card scams. Target told us it posts scam warnings at gift card racks, and it trains cashiers to spot potential victims. CVS told us you can't buy a gift card unless you acknowledge a scam advisory on the checkout register screen. We put that to the test, and a San Jose CVS store did indeed offer this warning:

Jennie Atkinson says more retailers should adopt this approach.

"I think Macy's needs to be more aware of this and protect their customers," she said.

We asked Max Atkinson if anyone at Macy's warned him what he was doing might have been part of a scam.

"They did not," he said.

NBC Bay Area repeatedly contacted Macy's to ask about its policies and training. It did not respond to us.

The Retail Gift Card Association recommends "best practices" for stores that include questioning customers who buy large quantities of gift cards, and training employees to spot potential scam victims.

Rachel Yoshida, Max Atkinson's granddaughter, says those guidelines should be mandatory.

"Other stores have enacted policies with the sole intention of protecting their senior customers," she said. "To me, it's a no-brainer."

Still, store policies aren't a guaranteed safeguard. Best Buy says it limits gift card sales to $2,000 per person, per day. But Lisa Hardy says the Emeryville location sold her father $3,000 worth in one day.

"They just sold him the gift cards," Hardy said.

We asked Best Buy about Hardy's complaint. It did not respond to our inquiry.

Back in Santa Clara, Max Atkinson admits he fell for a con, but he remains frustrated with Macy's.

"I made a mistake, yes," Atkinson said. "But they could have stopped it in its tracks.

If you believe a family member paid a scammer in gift cards, the key is to act fast. Immediately call the store that issued the gift cards, and ask them to freeze the money stored on them. Although the Atkinson family moved quickly, the crooks were faster -- and still got away with more than $10,000.

We learned about this story from viewers like you. If you have a consumer problem, please let us know -- click here to reach us online. If you prefer, you can call us at 888-996-8477.

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