email : Webview : Scam Alert: This online gift exchange has a hefty consequence

The 'Secret Sister' gift exchange is illegal

The 'Secret Sister' gift exchange campaign quickly became popular several years ago through Facebook posts promising participants would receive up to 36 gifts in exchange for sending one gift.

Each holiday season, the scheme pops back up. One version of this scam revolves around exchanging bottles of wine or bourbon; another suggests purchasing $10 gifts online. You might see references to receiving "happy mail" or doing the exchange "for the good of the sisterhood." During the 2024 holiday season, be aware of variations of this theme that may crop up on social media.

How this scam works

The scheme starts with a convincing invitation, either by email or social media, to sign up for a great, fun program. All you must do is provide your name and address and the personal information of a few additional friends and tack this information onto a list that's already started of people you've never met on the internet. Next, it's your turn to send an email or social media invitation to send a modest gift or bottle of bourbon to a stranger along with their friends, family, and contacts.

A newer twist on the idea asks you to give your e-transfer email and ask users to pick a name off a list and send money to strangers to "pay it forward." There was another new twist called "Secret Santa Dog," in which you were asked to buy a $10 gift for a "secret dog."

In all of these versions, you give away your personal information, and you're left buying and shipping gifts or money to unknown individuals, hoping that someone else will reciprocate the favor by sending the promised number of gifts in return. Unfortunately, it often doesn't happen. Like any other pyramid scheme, it relies on recruiting individuals to keep the scam afloat. Once people stop participating in the gift exchange, the gift supply also stops, leaving hundreds of disappointed people without their promised gifts or cash.

Note: Pyramid schemes are illegal in the US and Canada. The U.S. Postal Inspection Services explains that these gift exchanges are considered a form of gambling and that participants could be penalized for jail time, fines, or a lawsuit for mail fraud.

Participating in these schemes poses another layer of danger. When signing up, the alleged campaign organizer asks for personal information such as a mailing address or an email. With just a few pieces of information, cyber thieves could expose you to future scams or commit identity theft.

How to avoid similar scams

Ignore it! Keep in mind that pyramid schemes are international. Chain letters involving money or valuable items and promising big returns are illegal. Stop and ask, is it worth breaking the law? Report it instead to Canadian agencies or the U.S. Postal Inspection Services.
Report it to the social media platform. If you receive an invitation to join a pyramid scheme on social media, report it to the platform.
Never give your personal information to strangers. Even your mailing address can expose you 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 impostor 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.

Find more consumer tips at BBB.org

For more information

Stay safe this holiday season with BBB's expert tips on avoiding common scams.

If you've been the victim of a scam, report it to BBB Scam Tracker. Sharing your experience can help others avoid falling victim to similar scams.

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