Biz Roundup: BBB warns that ‘Secret Sister’ gift exchange is Illegal
The Better Business Bureau is reminding consumers that the online “Secret Sister” gift exchange and similar invitations are illegal and should be ignored. The campaign, which was first big in 2015, has again been circulating on social media sites, particularly Facebook.
The post says that participants will receive as many as 36 gifts in exchange for sending one gift valued at $10. Users are encouraged to invite others to participate in the holiday gift exchange and receive information on where to mail gifts.
But gift chains like “Secret Sister” are pyramid schemes. The U.S. Postal Inspection Services says that gift exchanges are illegal gambling and that participants could be subject to penalties for mail fraud.
Pyramid schemes are illegal, either by mail or on social media, if money or other items of value are requested with assurance of a sizable return for those who participate.
Here is how the scheme works: If a consumer purchases one gift for a stranger, she will receive as many as 36 gifts in return. This type of gift exchange may seem reasonable enough in theory: six friends invite six more friends, who all send gifts to the participant in Spot 1 before that person’s named is removed. The process repeats itself with the participant in No. 2 spot, and so on.
Starting this gift exchange comes with a catch – you need to disclose personal information, such as your home address.
If you receive a chain letter by mail, email or social media, especially one that involves money or gifts, ignore it, the BBB advises. Report the post to Facebook by clicking on the three dots in the upper right corner of the post.
For more information on scams, check out BBB Scam Tips (BBB.org/scamtips). Report scams to BBB.org/scamtracker.