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'Secret Sister' scam gift exchange is back, BBB warns

Posted at 10:09 AM, Nov 12, 2020

Even during a pandemic, scammers continue to use the holidays as a way to steal your money.

The Better Business Bureau is alerting people that the "Secret Sister" gift exchange that circulates on Facebook is back, and it is an illegal scam.

Gaining popularity in 2015, the "Secret Sister" scam is a pyramid scheme disguised as a fun online gift exchange.

"The 'Secret Sister' gift exchange campaign quickly became popular in 2015 through Facebook posts promising participants would receive up to 36 gifts, in exchange for sending one gift, valued at $10," the BBB says in a press release. "Users were encouraged to invite others to participate in the holiday gift exchange, then promised they would receive information on where to mail the gifts."

Here's how it works. The scheme starts with an invitation, either by email or social media. It asks you for a few details, such as your name, address and the personal information of some of your friends and family. This information gets added to an existing list of people who have already provided their information — strangers from the Internet that you've never met. Then, you're instructed to send an email or social media invite that asks to send a modest gift to a stranger along with their friends, family and contacts.

The cycle continues and you end up buying and shipping gifts to unknown people. Unfortunately, your favor won't be reciprocated.

"Just like any other pyramid scheme, it relies on the recruitment of individuals to keep the scam afloat," the BBB says. "Once people stop participating in the gift exchange, the gift supply stops as well, and leaves hundreds of disappointed people without their promised gifts."

Pyramid schemes are illegal in the United States. In addition, the U.S. Postal Inspection Service says these gift exchanges are a form of gambling, and you could face jail time, fines or lawsuits for mail fraud by participating.

In addition, the BBB says you never want to give your personal information to strangers online. This information can be used by criminals in future scams or be used to commit identity theft.

So how can you stay safe? The BBB has these recommendations for the next time someone tries to entice you into doing one of these gift exchanges.

  • Ignore it! Keep in mind that pyramid schemes are international. Chain letters involving money or valuable items and promise big returns are illegal. Stop and ask, is it worth breaking the law? Report it instead to Canadian agencies or to the U.S. Postal inspection Services.
  • Report social media posts. If you receive an invitation to join a pyramid scheme on social media, report it. You can report these Facebook posts by clicking in the upper righthand corner and selecting “Report post” or “report photo.”
  • Never give your personal information to strangers. This will open you up to identity theft and other scams.
  • Be wary of false claims. Some pyramid schemes try to win your confidence by claiming they’re legal and endorsed by the government. These imposter schemes are false as the government will never endorse illegal activity. No matter what they claim, pyramid schemes will not make you rich. You will receive little to no money back on your “investment” or gift exchange.