It’s becoming an annual holiday tradition—the Better Business Bureau has once again issued a warning about the “Secret Sister” gift scam. Stay away from Facebook posts asking for “six ladies to participate in a Secret Sister gift exchange,” as it’s a pyramid scheme that relies on unwitting people to promote the scam to their friends.
How the scam works
The scheme starts with a convincing invitation for a gift exchange program, usually through Facebook, but also through email or other social media. Users are promised up to 36 gifts—as long as they buy a gift that costs $10 (sometimes it’s a wine bottle) for a stranger on the internet, provide contact details, and recruit six more friends to do the same. A typical message might look like this:
“The Secret Sister gift exchange is back! I’m looking for six women who would be interested in a pre-holiday gift exchange. You only have to buy one $10 gift and send it to your secret sister. You will then received 6-36 gifts in return. Let me know if you’re interested and I will send you the information for your secret sister. We all could use some happy mail!”
Of course, 36 or even six gifts in exchange for one is too good to be true: Just like any other pyramid scheme, this scam relies on recruitment to stay afloat. If people stop participating, those farther down the chain are left with nothing but $10 spent and empty promises. People tend to be recruited by unsuspecting friends or family, so they often don’t realize they’ve been tricked into joining a scam.
As for the contact information you’ve provided, including your email or home address—that information can be used or sold for future scams or potential identity theft.
How to avoid this scam
The Better Business Bureau recommends:
- 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.
This story was originally published in 2019 and was updated on November 23, 2020.