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Voice of the consumer: 'Secret Sister' gift exchange is a pyramid scheme - Colorado Springs Gazette

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With the holidays fast approaching, I’m sure many of you will be participating in gift exchanges this year. Our KKTV newsroom is doing a socially distanced Secret Santa to spread joy around the office. Any gift exchange with friends, family members, co-workers or other people you know is a great way to get in the holiday spirit, but the Better Business Bureau (BBB) is warning people against trading gifts online with people you don’t know.

You may have seen some posts on social media about the “Secret Sister” gift exchange. It can also go by other names, but the premise is the same. All you have to do is buy and send one gift, and you’re guaranteed to receive up to 36 gifts in exchange. I’ve definitely seen some of my Facebook friends share these posts recently.

While it might seem like harmless fun, the BBB says this is really a pyramid scheme, and it’s actually illegal. The U.S. Postal Inspection Service says it’s considered a form of gambling, and people who participate could face penalties like jail time, fines or even a lawsuit.

It all starts with an invitation. You might get an email or see a post on social media like I did. The message encourages people to sign up and provide their name and address, along with the contact information of a few additional friends. You’re then asked to share the post or send an email of your own to get more people to participate.

This cycle continues and eventually, you’re expected to send gifts to people you don’t know in the hope that you’ll get presents in exchange. Unfortunately, according to the BBB, that doesn’t often happen.

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

The BBB says people should be especially wary of posts that claim they’re legal and endorsed by the government. This is false.

If you come across the post, the BBB recommends just ignoring it. You can report it to the U.S. Postal Inspection Service by calling 1-877-876-2455 or visiting www.uspis.gov/report/.

You can also report the scam on social media. For Facebook, click the three dots in the top right corner of the post, then select Find support or report post. On Instagram, you’ll also click the three dots in the top right corner, and select Report.

The BBB also reminds people to never share personal information online or give the information out to strangers.

You can see the biggest scams in your area and report these schemes to the BBB by visiting bbb.org/ScamTracker.

Remember, you can also report scams, fraud and price gouging to the Colorado Attorney General’s Office. The consumer hotline number is 800-222-4444.

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Voice of the consumer: 'Secret Sister' gift exchange is a pyramid scheme - Colorado Springs Gazette
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