Most Australian households now buy online for all or part of their shopping needs, and since coronavirus lockdowns, even more goods are purchased over the internet. Consequently, more scammers are setting up fake websites and deceiving people into transacting with them by taking advantage of this trend.
Scammers have focussed on senior Australians, as the total cost swindled from older consumers in 2021 skyrocketed to over $11 million1. Online shopping scams alone cost seniors $1.8 million last year. A typical example of this fraud is purchasing a motor home online via fake websites.
How an online scam works.
While most online sellers are legitimate, unfortunately, scammers can use the anonymous nature of the internet to con unsuspecting shoppers.
Online shopping scams are very sneaky because they involve scammers pretending to be legitimate online sellers, like Amazon, either using a fake website or a fake advertisement on a genuine retailer’s site. To make the con seem legitimate, the scammers may use sophisticated designs and layouts, possibly stolen logos, even a ‘.com.au’ domain name and stolen Australian Business Number (ABN).
According to the ACCC ‘s Scamwatch website, many online shopping scams offer luxury items such as popular clothing brands, jewellery, and electronics at low prices.
Once the order is placed and payment made, consumers might receive a fake, inferior product compared to what was promised. Worse, they might receive nothing at all.
Classified scams are a subset of online shopping scams, where crooks pose as genuine sellers, posting fake ads on a classified’s website, newspaper, or via email or social media.
The scammers also take advantage of social media platforms to create online shopping scams. They open the store for a short time, often selling counterfeit branded clothing or jewellery. After making several sales, the stores vanish. Scammers also use social media to advertise a phoney shopping website. So, don’t place your trust in an online shopping site just because you saw it advertised on Facebook.
Search for reviews before purchasing to ensure you’re not buying from an online shopping scammer. Also, avoid an online shopping sting by navigating directly to the retailer using your web browser rather than by clicking any emails or a social media link you may have received out of the blue.
Look out for the warning signs.
The payment method can be a major tip-off that a retail website is a scam. Scammers often ask unsuspecting consumers to use a money order, a pre-loaded money card, or a wire transfer to make a payment. However, if you use these transaction methods, you will unlikely see the money again or receive your purchased item.
Other warning signs include:
- If the price for a product or service is too good to be true or unique benefits are offered.
- The “online retailer” insists on immediate payment or payment by electronic funds transfer or a wire service.
- The “seller” operates offshore or does not allow payment through a secure payment service such as PayPal or a credit card transaction.
- The social media-based store is very new and sells products at extremely low prices.
- The online store has limited information about delivery and other policies.
- The website fails to provide adequate information about privacy, terms and conditions of use, dispute resolution or contact details.
If you suspect a scam or fraudulent activity, members can contact us by phone between 8 am and 6pm AEST/AEDT Monday to Friday on 1800 033 139 or by email to firstname.lastname@example.org 24 hours a day, 7 days a week.
Important note: This information is of a general nature and is not intended to be relied on by you as advice in any particular matter. You should contact us at Defence Bank to discuss how this information may apply to your circumstances.