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Prepaid Debit Card Scams

For years, scammers have duped people into wiring money using wire services. Today, scammers are increasingly asking people to pay money with reloadable, prepaid debit cards.

It works like this: “Betty” decided to buy an exercise machine from an unknown website on the Internet. The equipment looked good and was listed at a fair price. The seller told Betty to go to a local “big box” retail store and buy a prepaid debit card, load it with $700, and give the seller the serial number. Betty did so. After paying the $700, she never heard from the seller again.

Reloadable Prepaid Debit Cards

The prepaid debit card is a reloadable debit card sold at major retail stores. It has a serial number that is used to transfer funds to the card. It functions like a traditional checking account debit card, without the need for a paper check. The consumer can designate how much money to load onto the card at any given time. Money on the card can be transferred to another debit card or to make same-day payments to other companies. If the serial number falls into the hands of a scammer, the scammer can drain the money from the card.

Common Scams Asking for Debit Card Payments

Scammers like to have money transferred to them in ways that allow the scammer to be long gone before the scam is detected. For the same reason that scammers often ask money to be wired to them in another country (e.g. they’ll be long gone with the wire transfer before the consumer spots the scam), scammers may ask that money be given to them using a prepaid debit card. The following are examples of some such scams:

Protect Yourself from Fraud

The following are some tips to protect against this type of fraud:

If You’re a Victim

These scams are crimes. If you have paid money to a scammer, file complaints with the following agencies:

Federal Bureau of Investigation
Minneapolis Office

1501 Freeway Boulevard
Brooklyn Center, MN 55430
(763) 569-8000  (External Link)

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