The 71-year-old man received a social media message on Monday, March 18 , suggesting he was eligible for a government grant to assist his local church.
He was told to receive that money he must buy a quantity of Amazon gift cards online.
The man was directed to a website where he bought £500 worth of gift cards.
After no grant money was received the man called the police.
Police are warning community groups and individuals to be wary of any similar approaches on social media and report any such incidents to police.
Inspector Jacqi McGuigan, deputy local area commander for the Scottish Borders said: “The victim became suspicious when the funds he thought he’d applied for didn’t arrive and is now deeply upset, having been defrauded of £500.
“I want to take this opportunity to remind the public that no bona fide company or government agency will ask you to purchase gift cards so as to receive financial payment.
“If you are contacted by anyone making such an offer, do not accept. End the conversation without providing any of your personal details and contact police immediately.”
Those with information relating to this matter can contact Galashiels Police Station via 101 or Crimestoppers anonymously on 0800 5511, quoting incident number 2775 of March 18.