A federal judge ruled Monday that Google has no obligation to refund victims of scammers who trick them into buying Google Play gift cards. It is entitled to keep the fees and profit from the scams, too. Win-Win!
The lawsuit was filed by Judy May, who lost $1,000 in 2021 when scammers tricked her into buying Google Play gift cards by claiming she was eligible for a government grant. May was told she could send codes from the gift cards to cover "certain costs upfront to receive same-day delivery of the grant money." After she fell for it, she realized she'd been scammed, but Google refused to provide a refund, citing terms May considered "unconscionable."
May claimed that Google knows that its gift cards are a preferred way for scammers to steal funds and should put warnings on gift cards alerting customers to common scams. Her complaint noted that gift card scams are underreported, while citing Federal Trade Commission data finding that Google Play gift card scams accounted for 20 percent of reported gift card scams between 2018–2021 and triggered more than $17 million in losses.
This is an example of moral hazard: Google has an incentive to be complacent and complicit because it profits from the scam while the scammer absorbs all the legal risk.
Another reason it works is because so many people are easily induced to resent the victim for their apparent stupidity, as if "caveat emptor" covers all the bases occupied by con artists.
All you can really do is warn people—especially the old, the vulnerable, and anyone else who might easily be convinced by a con artist—that gift cards are inherently given to fraudulent and criminal activity, and that they should never buy one for anyone they don't know under any circumstances. That Google Play gift cards are the scammer's card of choice tells you something about Google, but it doesn't mean other gift cards are safer.
