With the holiday season picking up momentum, several organizations including the FBI, non-profit ScamAwareness.org and security app Authy are urging consumers to be vigilant about scams that are likely to surface this winter.
During the holiday season, the risk for fraudulent activity sharply increases, with “more transactions being completed online translating to a higher potential of being hacked,” says Marc Boroditsky, vice president of security app Authy. In fact, this year, global retailers could expect a 12% increase in fraudulent activity, compared to the same period a year ago—along with lower ticket prices on fraudster-targeted gifts and products, according to a recent study by ACI Worldwide. And due to the shift toward credit cards with EMV chips, which protects data through encryption, more fraudsters are concentrating their efforts online. As a result, ACI Worldwide predicts a 43% increase in online fraud attempts during this peak holiday season.
Ranging from gift card scams and the sale of counterfeit goods to fake charities, here are some common ways fraudsters try to deceive consumers, especially during this celebratory time of the year.
1. Unfamiliar Sites Selling Sharply Discounted Items
The FBI encourages consumers to be cautious when shopping online this holiday season, particularly when stumbling upon unfamiliar sites that are selling products at steep discounts. Consumers should remain leery of “unfamiliar sites offering unrealistic discounts on brand name merchandise or gift cards as an incentive to purchase a product, as you may end up paying for an item, giving away personal information, and receive nothing in return except a compromised identity,” the FBI said in a recent press release.
Also be wary of unsolicited e-mails with links promising deals that seem too good to be true. These types of promotions can include phishing links that aim to compromise consumers’ personal information.
When shopping online, consumers should also never wire money for an online purchase, says ScamAwareness.org. Once a money transfer is received, it can’t be recovered, the site warns. Consumers should also use two-factor authentication, complex passwords on customer accounts and be sure they’re shopping on secure sites. “Watch the URL on the bottom of your screen to make sure that the site you’re interacting with remains at the same domain,” says Boroditsky. He says that by taking this step you’ll have a better idea that you’re “not being referred out to a suspicious, fraudulent site.” In addition, stick with retailers and sites you know. The holiday season—when fraudulent activity is high—isn’t an ideal time to try out new vendors, especially an unknown manufacturer or retailer, he says.
2. Fake Charities
During the holiday season, charitable giving reaches a peak each year. However, scammers aim to take advantage of consumers’ generosity by creating fake charities or misusing the name and brand of a well-known charity to get donations sent to them. ScamAwareness.org urges consumers to verify that the charity and its web address are legitimate before making a donation. It’s also helpful to use a check or credit card when donating, rather than a wire transfer or cash. If the charity is a fraudulent one, the donation could more easily be recovered if a check or credit card was used.