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Secret Sister: the pyramid gift giving scam

One of the most popular scams on social media around Christmas time is the ‘Secret Sister’ gift exchange. We’ve taken a look at this scam so that you can stay safe during the holiday season.

What is the ‘Secret Sister’ gift exchange scam?

The ‘Secret Sister’ gift exchange is a Christmas gift exchange where you purchase one gift for a stranger, with the promise of receiving 6-36 gifts in return. It’s often posted on social media sites like Facebook, where a person encourages their friends to get involved and send a present to someone they have never met.

Once you respond to the post, the poster will let you know the details of the person you’re going to send your gift to (sometimes known as your ‘Secret Sister’). You’ll send your gift across, and once you do, your name is added to the bottom of a list, and your gift recipient’s name is struck from the top. Eventually, your name will move up the list, and you’ll become the ‘Secret Sister’ of at least six (or up to thirty-six) other people, and will receive a ton of gifts as a result.

That sounds great, where do I sign up?

Although the idea sounds lovely in principle, in practice this follows the same structure as multi-level marketing schemes (MLMs) and pyramid schemes, the latter of which is illegal in the UK. Here’s how it works.

Beck posts the gift exchange on their Facebook, and aims to recruit at least six people. Carla is one of the six people that Beck manages to recruit, and Beck sends them the details of the person that recruited them, Abe. Carla sends a gift to Abe, and then Carla needs to recruit six more people in order to be in with a chance of getting their gifts. Carla manages to recruit six people, including Deb. Carla sends Beck’s details along to Deb, and Deb sends Beck a gift. Deb then needs to recruit six more people, all of whom then send a gift to Carla. 

As you can see, the gift exchange works really well for Abe who is at the top of the pyramid, and has got a bunch of different gifts from everyone that Beck recruits. However, by the time Carla joins, her and the other five of Beck’s recruits need to collectively get thirty six more recruits, and then those recruits need to get another thirty six people involved for Carla to receive her gifts. 

The very nature of the Secret Sister gift exchange is not sustainable; those who are further down the list have very little chance of recruiting enough people who will recruit enough people to receive their gifts. As the pyramid grows, it quickly requires more people than the Earth has, even if every single person on the planet got involved.

And don’t forget your data…

To sign up for this, you’ll also have to provide your contact information, which because of the nature of the scam, has to be given to at least six, and potentially up to thirty six, other strangers. In signing up you’re taking a huge risk with your data; in essence, you’re shouting your full address at the internet. Not only does this open you up to additional scams, your data is worth money to hackers who will be only too pleased to take it off your hands.

It’s only £5, why does it matter if I don’t receive any presents back?

Assuming that your recipient is in the UK (because remember, anyone from anywhere can join, and it’s your job to get that present to them whether they live next door or in Australia), £5 given altruistically doesn’t seem like too much of a gamble, right? Even if you don’t get your presents back, you’ve done something good for someone you’ve never met.

However, this principle only works if you haven’t recruited, or made any effort to recruit six more people to take part in the gift exchange. If you do recruit your friends, they’ll be out of pocket too - when you’ve promised them a pile of presents.

We’d recommend sticking to gift exchanges with family and friends; that way everyone gives a gift, and everyone receives a gift. If you’re really keen to get a present for a stranger, check out Perfect Strangers: a parcel swapping project where you don’t have to recruit anyone. 

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