As the holiday season approaches, consumers are expected to spend billions on gifts, with a significant portion being spent online. Unfortunately, this increase in shopping activity also presents an opportunity for scammers looking to exploit unsuspecting shoppers.
Fraudsters know that many consumers are busy and distracted during the holidays, which makes them more vulnerable to scams. Margarita Alvarez, Senior Vice President of Consumer Risk Programs at Wells Fargo, explains that the higher volume of transactions creates an opportunity for scammers to take advantage of unsuspecting shoppers.
Billions Lost to Scams Every Year
According to a recent report from the Global Anti-Scam Alliance, scammers worldwide have swindled over $1 trillion from victims. The actual number is likely even higher, as many victims are too embarrassed to report their experiences. The Federal Trade Commission reports that U.S. consumers alone lost over $10 billion to fraud in 2023.
Additionally, the Better Business Bureau (BBB) has seen a 125% increase in scam reports, particularly those targeting holiday shoppers with fake advertisements for discounts or popular items. Online shopping scams are one of the most common types of fraud, with over 80% of scam reports resulting in financial losses.
Another issue gaining attention is porch piracy. A report from CNET estimates that nearly $97 billion worth of packages could be vulnerable to theft this holiday season. Almost 1 in 6 U.S. adults reported being victims of porch piracy in the past year. Many consumers are using tracking tools and home security cameras to protect their deliveries.
Common Holiday Scams and How to Avoid Them
To help protect yourself while shopping this season, here are some of the most common holiday scams and tips on how to avoid them:
- The “Hot Toy” Scam: Scammers often target parents looking for the most popular holiday toys by sending fake links to irresistible deals. Always shop from trusted retailers and avoid clicking on unsolicited emails or links.
- Fake Package Notifications: Be wary of unsolicited texts or emails claiming to help track or resolve an issue with a package. These may be attempts to steal your personal information.
- Fake Charities: Many scammers take advantage of the spirit of giving during the holidays. Before donating, research the charity to ensure it’s legitimate and not a scam.
- Holiday Job Scams: Scammers often post fake job opportunities, especially during the holiday season when part-time work is common. Be cautious of any job offers that seem too good to be true.
- Gift Card Scams: Avoid buying gift cards from third-party sites, as scammers may sell expired or fraudulent cards. Never respond to unsolicited emails or text messages offering you gift cards.
- “Friendly” Social Media Messages: Scammers may reach out on social media, establishing a friendly rapport before asking for money. Be cautious of unsolicited messages from unknown contacts and never send money to someone you don’t know.
- Deals That Are Too Good to Be True: Scammers often offer unrealistic deals with steep discounts on popular products. If a deal seems too good to be true, it probably is. Always compare prices from different retailers before making a purchase.
- Fake Websites: Scammers often create websites that look like legitimate online stores. Always double-check the website’s URL for slight spelling variations, and ensure the website is secure (look for “https” and a padlock icon in the browser address bar).
- Use Secure Payment Methods: When shopping online, use a credit card instead of a debit card or payment app. Credit cards offer better fraud protection than other payment methods.
- Fake Reviews and Testimonials: Many scammers use AI to generate fake reviews and testimonials to trick consumers. Always do your own research and read reviews from trusted sources before making a purchase.
- Payment App Scams: Scammers may pose as representatives from your bank or credit card company, claiming to detect fraud on your account. They may ask you to transfer money to “protect” it, but the account they provide will be controlled by the scammer. Always verify any suspicious communication from financial institutions.
- Account Takeovers: Monitor your accounts for unusual activity, such as unrecognized orders or changes to your shipping information. Account takeovers often involve scammers gaining unauthorized access to make purchases or transfer funds.
- Avoid Public Wi-Fi When Shopping: Fraudsters can exploit unsecured public Wi-Fi networks to steal sensitive information. Use a secure, private connection when making purchases online to protect your data.
By staying vigilant and following these tips, you can minimize your risk of falling victim to scams this holiday season. Stay aware, and enjoy your holiday shopping with peace of mind.
