Gift exchange campaign became popular several years ago through Facebook
A “Secret Santa” around the office, or with friends and family
can be fun. A gift exchange among online friends you haven’t met, well,
that’s a little different and carries a heftier consequence. These gift
exchanges, while they look like innocent fun, are really pyramid schemes
– and are considered 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. A newer version of this scam revolves
around exchanging bottles of wine; 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 2021 holiday
season, be aware of variations of this theme that may crop up on social
How the Scam Works
The scheme starts with a convincing invitation, either by email or
social media to sign up for what seems like a great, fun program. All
you must do is provide your name and address and personal information of
a few additional friends, and tack this information on to 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 wine to a stranger along with their friends, family
A newer twist on the idea asks you to give your etransfer email and
asks users to pick a name off of a list and send money to strangers, to
“pay it forward.”
There was even another new twist called “Secret Santa Dog” where you are 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 with buying and shipping gifts or money to unknown
individuals, in hopes that the favor is reciprocated by receiving the
promised number of gifts in return. Unfortunately, it doesn’t 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.
It should be noted that 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
subject to penalties such as jail time, fines or a lawsuit for mail
There is another layer of danger to participating in these schemes.
When signing up, the alleged campaign organizer is asking 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.
The next time someone promises a bounty of gifts or cash by mail, email, or social media, BBB recommends the following:
- Ignore it! Keep in mind that pyramid schemes are
international. Chain letters involving money or valuable items and
promise big returns are illegal. Stop and ask, is it worth breaking the
law? Report it instead to Canadian agencies or to the U.S. Postal Inspection Services.
- Report social media posts. If you receive an
invitation to join a pyramid scheme on social media, report it to
Facebook by clicking in the upper righthand corner and selecting “Report
post” or “report photo.”
- Never give your personal information to strangers. This will open you up 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 imposter 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.
More information on scams is available by visiting the BBB scam news feed. Report scams to BBB Scam Tracker.
Visit the BBB Holiday Tips page for more tips on shopping safely this season.