Coupon fraud: How to spot and prevent coupon scams

What is coupon fraud?

Coupon fraud is a scam committed by individuals or groups who abuse coupons to cheat brands, retailers, or customers out of money. It happens both online and in stores, sometimes without the victim realizing it. Fraudsters may use fake, altered, or misused coupons to get unearned discounts — from printing counterfeit coupons and reusing digital codes to pressuring cashiers into accepting expired or ineligible offers.

Coupon fraud doesn’t just harm one group — it targets both consumers and businesses, but in different ways.

• Fraud targeting companies: Large-scale operations often focus on defrauding manufacturers and retailers by creating counterfeit coupons, cloning legitimate ones, or exploiting system glitches. These scams can cost companies millions in lost revenue and damage trust with both retailers and shoppers.
• Fraud targeting individuals: Many scams prey on everyday shoppers by offering fake or too-good-to-be-true coupons online. These fraudulent offers often steal personal data through phishing, trick people into downloading malware, or simply scam them out of money.

Understanding this distinction helps you stay alert — whether you’re a shopper guarding your personal information or a business protecting your brand.

How coupon fraud works 

Fraudsters use a range of tactics depending on their goal. Some are looking to trick businesses financially. Others want your personal data, and they use fake offers to get it.

Here's how coupon fraud usually plays out:

1. 1.A scammer creates or promotes a fake coupon online (usually through social media, shady coupon sites, or email).
2. 2.You click the link, fill out a form, or download a file to get the coupon.
3. 3.Either the fraudulent coupon doesn't work, or you've unknowingly handed over your data to someone who's not who they say they are.

However, not all coupon fraud is intentional. Sometimes, a shopper just wants a good deal and doesn't realize they're using a counterfeit or expired coupon. But other shoppers know exactly what they're doing – they clone codes, steal inserts from newspapers, or find technical "glitches" in barcode systems to game the rules. In some cases, they'll resell discounted items for a profit.

Types of coupon fraud

Coupon fraud comes in many forms. Some are basic scams targeting individuals. Others are large-scale operations that quietly bleed retailers dry. Let's look at some of the most common types.

Fake coupon codes 

These are made-up promo codes that don't actually work. You'll often find fake coupon codes on sketchy sites, in phishing emails, or shared through spammy social media posts. Some may redirect you to a fake checkout page designed to steal credit card info or personal data.

Coupon cloning

Some fraudsters get their hands on real physical or digital coupons and then copy them. These clones can then be reused multiple times or resold to others. Retailers often detect cloning only after seeing the same code used over and over again, costing them revenue and damaging trust.

Coupon glittering

Coupon glittering is the art of tweaking a legitimate coupon to make it do something it wasn't meant to. That may mean altering the barcode or reprogramming a digital coupon so it works on higher-priced items, stacks when it shouldn't, or bypasses quantity limits. It's deliberate manipulation, and it often flies under the radar unless a store audits the redemptions closely.

Stolen coupons

Stolen coupons are legit codes that have been obtained illegally. It may be someone hacking a company's coupon generator or stealing codes from paid partners. In some cases, these stolen coupons are resold at a discount, which seems like a deal until the coupon gets flagged or the shopper’s account gets suspended.

Too-good-to-be-true offers

A too-good-to-be-true offer is designed to bait clicks and harvest personal information. Think "90% off Nike, today only!" These offers often lead to fake websites or phishing pages that ask for your name, email, and sometimes your payment details but never deliver a real discount.

Buying and selling coupons 

Almost all US coupons are marked "non-transferable," which means you're not supposed to sell or trade them. Sharing a promo code with a friend is fine, but buying coupons online, especially in bulk, puts you at risk. Most of what's sold on sketchy marketplaces are stolen, cloned, or simply counterfeit coupons. And if you use them, you could be the one facing the consequences.

How to spot coupon fraud 

Pay attention to these warning signs that a coupon code may not be legit:

• It's not on the brand's official site. Always start from the retailer's homepage or official app.
• The site uses a strange URL or contains misspellings. Scam sites often use domains that mimic real ones (e.g., amaz0n.com).
• Too much personal info is requested. If a coupon site wants your address, phone number, or credit card info up front, it could be setting you up for identity theft.
• The coupon has no expiration date. Real promotions usually have limited windows of validity.
• Pop-ups appear and you notice forced redirects. These are classic scam site behaviors.
• The coupon isn’t applied at checkout. If it looks real but fails at checkout, it may be a counterfeit coupon.

Recent examples of coupon fraud 

Coupon fraud is not a minor nuisance. It has led to big lawsuits, criminal charges for offenders, and massive financial losses for brands and retailers. Here are a few cases that made headlines.

$31.8M counterfeit coupon ring

In 2021, a Virginia Beach couple was sentenced for running one of the biggest coupon fraud schemes in US history. They created counterfeit coupons and distributed them online, costing manufacturers over $31 million. When the scheme was uncovered, the husband and wife were sentenced to 7 years and 12 years in prison, respectively. This textbook coupon fraud case proves how high the stakes can be.

“Free Chick-fil-A” Facebook scam

At one point, fake Chick-fil-A coupon offers were making the rounds on Facebook — all you had to do was fill out a quick survey. Except these weren't from the actual company. They led users to phishing sites that harvested data. While many witnesses expressed warning that these were obviously fake coupons, thousands fell for the offer.

The Queenpins case

The 2021 movie Queenpins was based on a real scam. From 2007 to 2012, three women ran a site called SavvyShopperSite.com, selling fake manufacturer coupons they bought from overseas. The operation caused over $40 million in losses. When police raided their homes in Arizona, they seized piles of counterfeit coupons. The ringleader, Robin Ramirez, got two years in prison. The others got probation. Together, they were ordered to pay nearly $5 million in restitution to companies like Procter & Gamble and PepsiCo.

Honey: Trust issues with a browser extension

A common question online is: Is Honey legit? Technically, yes — Honey is a real browser extension that finds and applies coupon codes at checkout. But it's also faced scrutiny.

Some users have exploited browser extensions like Honey to distribute fake or unauthorized coupons, tricking retailers and taking advantage of automated code injection. While Honey itself isn’t a scam, its open platform has, at times, been misused — prompting questions about how much trust shoppers and retailers should place in third-party coupon tools.

How to prevent coupon fraud

Want to protect your wallet and your data? Use these habits to stay clear of coupon scams:

• Only use trusted sources for coupons. Go straight to the brand's website, app, or trusted platforms for secure online shopping.
• Skip the shady stuff. Avoid clicking on coupons shared in Facebook comments or random forums.
• Never trade personal info for a code. No deal is worth your email address, phone number, or card details.
• Use a password manager. It helps you avoid typing credentials into fake sites.
• Make sure you're on the real site. Check if the website is legit — can you spot "https," clean spelling, and no weird characters in the URL?
• Double-check offers that seem too generous. If it looks fake, it probably is.
• Use security tools. Services like NordVPN’s Threat Protection Pro can block access to known malicious sites, stop malware, and flag phishing attempts before you click.

What to do if you have fallen for coupon fraud 

Got tricked by a fake coupon? It happens, but you've got to act fast:

• If you entered your bank account or card details, check your bank and credit card activity for any unauthorized transactions. Look for transactions you didn’t authorize.
• Contact the retailer. Let the person or company know what happened — they may have seen the scam before and can help.
• If you entered your login details into a fake or phishing site, immediately change your passwords and, if you haven’t already, turn on two-factor authentication (2FA) for extra security.
• Run a malware scan. If you downloaded files, make sure your device is clean. Some fake coupon sites host files laced with malware or viruses.

How to report coupon fraud

If you’re in the US and want to help stop scammers, you can report coupon fraud to several official agencies.

• United States Postal Inspection Service (USPIS): For fraud involving mail-in coupons or postal scams. 
• Federal Trade Commission (FTC): For digital or consumer fraud. File a report at reportfraud.ftc.gov.
• Federal Bureau of Investigation (FBI): Report larger-scale fraud or organized schemes through ic3.gov. 
• Internal Revenue Service (IRS): For when the fraud involves tax issues or stolen refund coupons.
• Better Business Bureau (BBB): You can also report local scams at bbb.org.

Can I get my money back if I fall victim to a coupon scam? 

Do banks refund scammed money? It depends on how you were scammed and what payment method was used.

• If you have given away credit card details, call your bank immediately. Most credit card issuers offer fraud protection.
• If you made a purchase and got nothing in return, you may be able to file a dispute or chargeback.
• If you sent money through less secure means (like wire transfer or crypto), recovery is less likely — but still worth reporting.

Banks are generally more likely to refund your money if you act fast.