Shopping online can be a fantastic option at Christmas and during the January sales. Leave the crowds and the traffic behind while you shop in your own time, sitting on the couch. From the comfort of your living room, you can have an almost unlimited range of choices available at the click of a button. However, particularly around this time of year, it pays to be skeptical, vigilant and aware of the possibility of a scam.
Online shopping scams are currently the fifth most expensive type of scam after online investment, online dating, false billing and hacking. Australians lost over $4 million dollars to online shopping scams this year alone. This is well up on last year, when losses totalled around $3.28 million. In 2019, there were 7850 reports of online scams and over 60 per cent of these also reported financial losses.1
The table below shows the most common delivery method of online shopping scams.2
How does it work?
The most common scenario is when a scammer pretends to be a legitimate online seller with a fake website and potentially an online ad. The website purports to be a well-known retailer, ‘selling’
popular branded merchandise – often luxury items such as clothing, jewellery or electronics. Sometimes you may receive an item you buy, but it is a ‘fake’; often, you will receive nothing.
Alternatively, an online shopping scam may simply involve an authentic-looking but unknown website that appears to be selling ‘gifts’. They will usually be popular items such as a smartphone or tablet, offered at very cheap prices.
The web technology used for these sites is often advanced, so the site may look completely genuine – with high level design, logos and even a ‘.com.au’ domain name and an ABN.
Online shopping scammers also use social media pages such as Facebook as a platform for a fake online store. They advertise through the social media platform, with a click through to their ‘store’ page. The fake store may be online for a while and will then disappear after enough ‘sales’ have been made.
Particularly around Christmas, scammers may also post goods for sale on online classified sites (such as eBay and Gumtree) or Facebook buy/sell groups, to trick people into buying items that don’t exist. This time of year also brings an increase in parcel delivery scams, where scammers ask you to print off a label, do a survey or view the status of a delivery by clicking on a link or downloading an attachment. These scams aim to get people to download malware or give up personal information.
How can you tell if it’s a scam?
- The method of payment is often the biggest red flag. A scammer may ask you to pay via money order, pre-loaded money card, international funds transfer, electronic bank transfer or electronic currency (such as bitcoin). Alternatively, they may insist you pay upfront for a ‘voucher’ before you can access a ‘deal’. They will not usually allow payment through a secure service such as PayPal or credit card transaction.
- If a product is being ‘sold’ at an incredibly low price, or is advertised to have benefits that sound too good to be true, it probably is too good to be true.
- There may be limited information about delivery and returns policies, privacy, terms and conditions of use, dispute resolution or contact details.
- For products advertised on social media platforms, check comments and online reviews. A long list of complaints usually reveals a scam.
- Unsolicited contact via email, social media, text message and so on should be treated with caution. Scam emails may look official on the surface, using the same logos and design as known companies, and may include a link to a fake website. However, some red flags include an odd ‘from’ email address; imperfect spelling and grammar; forced or overly official language; a sense of urgency, e.g. ‘you must purchase within 24 hours to get the deal’; and a request to click through to enter details or download a file.
How can you protect yourself?
- Remember that scams exist and be alert to the ‘tricks’ when shopping online.
- If you aren’t 100 percent sure, do some research – many scams will already be uncovered and ‘known’ online.
- Check the URL starts with ‘https’ and has a closed padlock symbol.
- Australian companies are typically safer and easier to deal with.
- Most legitimate websites will offer a PayPal method of payment.
- Check the website or social media page you are using has a fair refund, returns and disputes policy. If they don’t, this is not a good sign.
- Look carefully at the website and work out who you are dealing with. Most legitimate sites will have an accessible phone number so you can always call to get a better feel for who they are.
- Never send money or give your credit card details to someone you don’t know or trust.
- Never open or download anything from an email or text unless you are 100 percent sure it’s from a safe source, particularly an .exe file.
- Never give out any personal or financial details to an unsolicited contact, even one that looks like it is from a well-known company or organisation.
- If you are buying from an online classified site, always do your messaging and make payments through the official site – better yet, pay in person once you have inspected the goods.
If you are worried about a purchase you have made, start by contacting the seller if you can. There may be a legitimate reason for the problem. If you suspect you have been scammed, contact your bank to see if you can arrange to get your money back. You should also contact your local consumer protection agency for help.
So, remain alert, but do not be alarmed. The majority of websites are genuine and will most likely offer you an easy and hassle-free online shopping experience this Christmas.
SOURCES: 1https://www.scamwatch.gov.au/types-of-scams/buying-or-selling/online-shopping-scams, 2https://www.scamwatch.gov.au/about-scamwatch/scam-statistics