With the holiday season in full swing, online gift shopping is the convenient and popular choice for many consumers in today’s digital age.
Those shoppers should beware: A 2023 study by the Federal Bureau of Investigation Internet Crime Complaint Center (IC3) showed scams were on the rise, and Minnesota ranked 18th among states last year with $193.9 million in losses.
This year about 70% of consumers in the U.S. said they were likely to shop for holiday gifts through online-only retailers, according to an October Statista study. Over half said they were likely to shop at mass merchants, and a third said they were thinking of shopping at off-price retailers or department stores.
“In 2023, IC3 received a record number of complaints from the American public: 880,428 complaints were registered, with potential losses exceeding $12.5 billion,” FBI Executive Assistant Director Timothy Langan said in the IC3 report.
A variety of scams
The FBI warned consumers that scammers can steal not only hard-earned money but also personal information.
Different types of scams include:
- Non-delivery scams where a shopper pays for online goods or services but never receives them.
- Non-payment scams where goods or services are shipped but payment is never received.
- Auction fraud where a purchased item was misrepresented on an auction site.
- And gift card fraud in which a seller might ask to be paid with a pre-paid card. This is where a seller may ask you to send them a gift card number and PIN. Instead of using that gift card for your payment, the scammer will steal the funds, and you’ll never receive your item.
According to the IC3 report, non-payment and non-delivery scams cost people $309 million in 2023.
The FBI said the IC3 receives a large volume of complaints of lost money or fraud in the early months of each year, which suggests a correlation with the previous holiday season’s shopping scams.
Common ways holiday scams are carried out include phishing emails or ads, social media scams including online surveys and offers of vouchers or gift cards, and charity scams.
According to the Better Business Bureau (BBB), the largest group of BBB Scam Tracker reports, 40% of the total, involve victims of online ads found on Facebook and Instagram.
Consumers told BBB that Facebook and Instagram are often not helpful in addressing violations of their own policies when consumers receive counterfeit goods, nothing at all, or items that were inferior to what was advertised and purchased.
Pop Crush reports that a Facebook scam is also back for the holiday season, aimed at tricking users to reveal login information. The phishing scam involves an email appearing to be from Facebook saying the user has violated its standards.
The message reads, “Recently, we discovered a breach of our Facebook Community Standards on your page. Your page has been disabled for violating Facebook Terms. If you believe the decision is incorrect, you can request a review and file an appeal at the link below.”
The link attached, once clicked, will give the scammer access to private information but will look real due to the fact it looks just like Facebook.com, according to Pop Crush.
The BBB recommends that consumers always log in directly to an account and proceed from there and never click on a sent link.
How to protect yourself
To avoid fraud, the BBB suggests a couple of things:
- Check out websites before making a purchase.
- Search for contact information and use caution if the site doesn’t have a U.S. or Canadian phone number or doesn’t use a Gmail or Yahoo business email address.
- Keep a record of what you ordered.
- Scrutinize online reviews.
- Pay by credit card as they often provide more protection against fraud than other payment methods.
The FBI suggests not opening unsolicited emails or clicking on any links in those emails. The agency also suggests securing banking and credit accounts with strong and different passwords, securing all other accounts that contain anything of value, staying away from untrustworthy sites and using general caution and vigilance.
Complaints about being the target of a scam can be filed with the Minnesota Department of Commerce. Online shopping fraud can also be reported by visiting websites such as the BBB, the Federal Trade Commission (FTC) and the Internet Crime Complaint Center (IC3).