Watch out for gift cards for the holidays

We’re at the last minute for holiday shopping and you might be tempted to look for one of these gift cards on the display at checkout to complete your list. Pay attention.

McLaughlin on Your Side hears all complaints. Alsysia Stansfield contacted us several years ago after finding out that the prepaid gift card she bought at the Walmart Super Center in Surrey had been compromised.

Counterfeit Cards

These prepaid cards are only valid when purchased and activated at checkout. So what went wrong?

Thieves had stolen the card from the display and carefully opened the package, replacing the $ 150 prepaid Visa card with an unnecessary dummy card. They copy the codes and all the necessary PIN information, then return to the store and slip them on the rack, hoping unsuspecting consumers don’t notice. Stansfield did not.

“I think someone has the cards at home waiting for them to be activated and is going to spend the money,” she said.

“The crooks copy the codes from the gift cards, then they scratch the strip on the back of the card to steal the PIN code. And once you load the money on the card, they can steal you, ”said Tobie Stanger, editor of Consumer Reports.

After getting ripped off, Stansfield says she returned to the store and found five more fake cards on the rack waiting to be purchased.

CTV News helped sort out the problem. She got her money back and Walmart cracked down by removing all the cards from the rack.

Be sure to examine your gift card carefully before purchasing it. Look for any cut seams, glue or residue and inspect the barcode.

E-gift cards

You should also be very careful when sending electronic gift cards. Make sure you’re sending it to the right person and entering the correct information, such as their email, phone number, or social media account.

Because you will be revealing personal information about yourself and the recipient, including credit card numbers, buy electronic gift cards only from trusted merchants.

Maintenance fees

Beware of prepaid gift cards that have maintenance fees. Federally regulated banks in Canada are not permitted to charge maintenance fees for the first 12 months on prepaid credit cards. And reloadable credit cards need your authorization to charge a fee.

These rules do not apply to credit unions.

Several years ago, Jessica Liew contacted McLaughlin on Your Side to complain about a $ 500 prepaid card issued by a credit union that she had received as a gift and had hidden and forgotten.

After three years, the monthly fees had eaten up about $ 200.

“Even though I hadn’t activated it, the money was still being deducted,” Liew said.

We helped track down financial institutions and got his money back.

His advice is to use the card right away. Also, make sure you understand the terms and conditions regarding the gift card you are purchasing.

No tax on cash value gift cards

When you buy a gift card with monetary value, the retailer is not supposed to charge tax on it. The tax is only collected when it is used to purchase goods. the Financial Consumer Agency of Canada and BC Consumer Protection are very clear on this.

However, the tax applies to cards that are specifically for a service like a haircut or massage.

If a retailer improperly charges you tax on a gift card, report it to Consumer Protection BC or the Consumer Financial Agency of Canada.

Michael N. Clark