It is a perennial debate this time of year: those who favor hitting the best stores at the best times against those who rely on their skill at finding just the right deal online. In the midst of the current pandemic, though, the familiar store vs. site showdown, like so many other family traditions, is going to look different.
Beware: While there’s no health risks to worry about, online sites can expose users to other harm, particularly unsuspecting newcomers. "We are seeing the same scams we always do, but criminals have more opportunities now because so many people are shopping online who aren't used to doing that," says Victoria Orrino, vice president at Alliant Private Client.
So as our holiday gift to you, we offer this quick guide to avoiding some classic holiday scams and their newer variations.
LINKS THAT DECEIVE
A lot of scams start with a link on a website or in an email that takes you to a different site than you intend to visit. n email purporting to be from your bank or credit card company links to a site that mimics their login page, luring you to enter your password. A discount offer from a famous brand leads to a well-disguised purveyor of counterfeits.
The Federal Trade Commission just reported a raft of fraudulent text messages claiming to notify the recipient of a package awaiting delivery. The link, however, jumps to a page that asks for passwords, social security numbers, and other private information. The AARP warned of similar links embedded in bogus online greeting cards.
Other online scammers are not looking for your personal information. Theirs is a short game; they just want your money—and right away. One of our clients’ children was just duped out of $1,500 in a gift- card buying scam.
Look skeptically at any link before you click, then examine the web address of the site it takes you to. Frauds use subtle variations on familiar names—homedep0t.com or bloomingdales.237.ru. In fact, the safest road is not to click on links at all. Better to type the address of a known site directly into your browser using a private WiFi network. (You can keep up with all the latest digital deceits and what to do about them at the Federal Trade Commission and Better Business Bureau's Scam Tracker websites.)
WELL-KNOWN SITES CAN HAVE SHADY VENDORS
You are likely already wary of fly-by-night merchants on sites like eBay and Craigslist, but did you know you are just as likely to run into questionable sellers on Amazon and Walmart.com? These online giants both run marketplaces where goods they sell themselves appear next to offerings from other vendors, who pay for access to the vast audiences.
Many of these secondary merchants are legit, but some inevitably sell inferior or counterfeit goods. Others engage in a legal but questionable practice called drop shipping. They advertise an item from one store, say Costco, at an inflated price. Only after someone buys from their shady listing do they order the item from Costco, directing it to be shipped to the customer. The buyer, who ends up paying too much, is left with little recourse. Recently, drop shipping has been prevalent in social networks such as Instagram and Facebook.
When you are buying online this holiday season, notice who the seller is. On Amazon, there is a small notice marked "sold by" a few lines under the "Buy Now" button. If the seller is different from the site you are on, that is a reason to delve a little deeper before you purchase.
FAKE CHARITIES AND OTHER APPEALS
Holidays inspire more than shopping. They bring out our charitable instincts and, unfortunately, scam artists who want to exploit that goodwill. One stunt is to create sites for charities with names that are easily mistaken for those of prominent organizations. Often these are promoted by ads that appear at the top of online searches for legitimate entities.
Another gambit: fake sob stories posted on sites like GoFundMe that ask for donations for people in need. Federal prosecutors recently charged a California woman with attracting 447 gifts totaling $60,272.43 through a site after falsely claiming she needed help paying for cancer treatments.
Always make sure a skeptical eye accompanies your big heart. Double-check the recipient of any donation. It might be best to limit gifts through sites like GoFundMe to only people with whom you have a personal connection.
IF YOU FALL PREY TO A SCAM
Victims of scams like these can sometimes be compensated for their loss. Marketplaces such as Amazon offer some limited guarantees that vendors will deliver what they promise. Credit card companies often won't make you pay for purchases that turn out to be fraudulent. Many insurance carriers offer some form of identity theft or credit card fraud protection. In fact, many have recently started offering even more inclusive cyber liability coverage. It is always best to give your broker a quick call to determine what coverage is available and consider adding the proper protection to your program if you haven’t already.
The holidays are a time of joy. A little extra vigilance this giving season will help to keep you in the spirit.