New warning on gift card scams amid holiday rush

ABC News' Becky Worley shares tips to protect your money as the FBI has warned that consumers are expected to lose $1 billion to gift card scams.
3:01 | 12/07/18

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Transcript for New warning on gift card scams amid holiday rush
We are back with an important warning for your holiday shopping about gift card scams. The national retail federation says spending on gift cards is expected to reach nearly $30 billion this year alone, but the FBI warns consumers are expected to lose a billion dollars to scams. Our consumer correspondent Becky Worley is here with more. This is one we all need to hear. That's right, they are convenient, Cecilia. They're useful and you don't even have to wrap them but if you are plunking a bunch of money into this, watch this first. Eye time to shop for great gifts for your family but that good cheer was lost for Josh Layton after he bought a $50 gift card from Walmart for his mom. He though it never left his wallet. I realized the gift card had been depleted to 47 cents. I was absolutely shocked. Reporter: The FBI receiving more than 36,000 complaints this year alone. Total lost to consumers nearly a billion dollars. Just last month Walmart, target and Best Buy in a joint action with law enforcement agencies announced changes to their gift card policies to prevent fraud. The most straightforward way that people are getting access to people's gift cards is in the stores. Reporter: Authorities say that rack of cards in pharmacies is an easy mark for criminals. Here's why. A criminal could just pocket one of these cards inside a store and then go out to the parking lot, take that metallic strip right off and write down the numbers. Once they have that, they can use one of these replacement metallic stickers you can buy online and just make it look brand-new. And then after you purchase the gift card and load it up, criminals periodically check and see if the card is active. Then they drain the balance. As for Josh, because he used the credit card with fraud protection for the purchase -- They actually refunded me the entire amount of which was stolen off the gift card. Reporter: This Christmas he's buying actual gifts instead of gift cards for his family. Walmart told us it's investigating Josh's case but it's a good warning for everyone. It certainly is. How do you know? What can you be on the lookout for? Specific tips. Like Josh use a credit card that has fraud protection. Next you want to make sure it hasn't been tampered with. If you're pulling a card from one of those racks you want to buy from the middle of the rack and examine that magnetic strip. Let me show you here. We've got a picture of the back of one. There is a P.I.N. Number under this strip. You need both pieces of information so a criminal will tamper with that P.I.N. And use a sticker. Buy one that looks like all the rest. You really want to be careful when you're doing this and you can also, remember this stuff, give cash. Oh, thanks. Merry Christmas. It still works. Good tips. Middle of the rack. And it goes back to the property department. She can't give it to you.

This transcript has been automatically generated and may not be 100% accurate.

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