The holiday season is a time of celebration, gatherings with friends and family, and shopping for gifts. Unfortunately, while the season brings plenty of cheer, there’s also the risk of holiday scams as bad actors ramp up their efforts to take advantage of gift givers, bargain hunters, and stressed-out shoppers.
With countless shoppers frantically looking for the perfect gift—preferably at a hefty discount—cybercriminals know that goodwill and distraction are at a seasonal high. This combination makes it easier to trick consumers into falling for scams.
While this can be concerning, the good news is that there’s plenty of advice to help you pay a little extra attention when doing your holiday shopping.
Where Is Holiday Shopping Fraud Most Prevalent?
Every year, fraud affects millions of people. In fact, in 2021 alone, nearly 3 million people reported an event of fraud, totaling an estimated $5.8 billion in losses. During the holidays, these scammers rob people of their hard-earned money, personal information, and festive mood.
What holiday scams are common, and how can you avoid them?
The most common types of fraud during the holidays are:
In delivery or shipping scams, a buyer may pay for a product or service they find online but never receive. Another example is finding a missed delivery notice on your door with a number to call to arrange delivery. The person at the other end of the line will ask a series of personal questions that can be used to commit identity fraud.
Peak delivery season often means a big pile of presents on your front porch that may prove irresistible to thieves. If you aren’t going to be home when your packages arrive, consider asking a relative or neighbor to accept delivery, or take advantage of Amazon Locker if it’s available in your area.
Social Media Scams
Criminals can easily open accounts and offer huge discounts on tempting incentives for taking a survey or sharing a post. Just clicking these offers could infect your device with malware or lead to a phishing attempt.
Many choose to spread cheer by donating money to a favorite cause. Scammers take advantage of this goodwill by soliciting donations to fraudulent or fake charities. Be wary of holiday charities that ask for donations through wire, mobile, or online money transfer.
Credit Card Fraud
This happens when an unauthorized person gains access to your personal and credit card information and uses it to make purchases. This usually occurs through skimming strategies, which some criminals employ to capture card information to steal from victims’ accounts. This can be done using a sophisticated skimmer device or by using cameras and overlay touchpads to eavesdrop and gather card info.
Gift Card Fraud
Be extra cautious about where you buy gift cards and who you buy them for. Buying gift cards through unsolicited emails or unfamiliar websites leaves you susceptible to fraud and theft. Likewise, an unexpected email from a friend or coworker asking you to purchase gift cards on their behalf should raise a red flag.
Additional Tips to Protect Against Fraud Throughout the Year
In addition to looking out for common holiday scams, you can take steps to protect yourself against fraud year-round.
Avoid making online purchases while connected to public or unsecured Wi-Fi.
Public Wi-Fi networks are notoriously vulnerable to cyberthreats. It’s fairly easy for a scammer to intercept your personal data, including credit card numbers and login credentials, on an unencrypted public Wi-Fi connection.
When making purchases online or accessing your bank account through a mobile app, only do so when connected to a secure network. A secure network is a private network that has security measures, such as antivirus and malware protection, in place that help protect it from outside attackers. If you must make a purchase outside of your secure home network, it’s safer to use your cellular network instead of public Wi-Fi.
Use a debit or credit card with anti-fraud features.
Many credit and debit cards offer anti-fraud features to help catch and stop unauthorized transactions before they’re approved. Take advantage of these safeguards by signing up for account alerts and paying attention to communications from your bank.
Keep your devices up to date with software, browser, and app updates.
The widespread increase in digital adoption as a result of the pandemic means new cyberattack methods. In response, fraud prevention technology is constantly improving, which means most software updates include security fixes that take care of new vulnerabilities. By regularly updating the software on your phone, laptop, and computer, you can protect against scammers who may be trying to steal your banking information.
Be wary of potential skimming activity when shopping in stores.
Be diligent and always cover the keypad when entering sensitive information in a public setting, including at ATMs. If you feel you’re being watched by someone, don’t enter the information until you’re certain they have gone away. Additionally, stay cautious of any suspicious devices used in an electronic payment. In some situations, a skimmer can be detected if a fraudster used more than one device to complete a transaction.
Only shop on reputable websites you can trust.
E-commerce security can vary widely from one platform to the next. In general, it’s best to shop on websites that have an “https” at the beginning of their URL or a padlock symbol next to it, which indicates a secure connection for transactions. If you’re uncertain of the reputation of an e-commerce site, be cautious and consider purchasing that item or gift from a different trusted brand.
Moreover, emails are one of the most common ways cybercriminals find their victims. Always confirm the legitimacy of an email sender before clicking a link or opening an attachment—especially if you don’t recognize the sender’s address or the email content seems suspicious.
Beware of these four red flags.
With so many retailers pushing hard for sales during the holidays, our inboxes and social media feeds are overflowing with deals and discounts. Although it can be hard to distinguish a real promotion from a scam, here are a few red flags you can watch for that may indicate an offer isn’t legitimate:
- Sounds too good to be true: If you see a highly sought-after gift advertised at an extreme discount on a social media site or unfamiliar webpage, don’t click. Instead, visit the retailer’s website to confirm the price.
- Lack of quality control: Spelling errors or poor grammar on a website or in an email—especially if it’s coming from a well-known brand—are major red flags that something is amiss.
- No contact information listed: When a website doesn’t list a business phone number, street address, or other verifiable contact information, you have good reason to be suspicious.
- Random or unnecessary requests for personal information: Unsolicited emails that ask you to click on a link and provide personal information, such as credit card numbers, login credentials, or your Social Security number, are the classic hallmark of a phishing attempt. When in doubt, don’t click.
What to Do if You Fall for a Scam
Amid the bustle of the holiday season, it’s easy to make small oversights that lead to a fraudulent scheme. Always keep a close eye on your account activity by regularly monitoring your funds for fraud charges and signing up to receive alerts about any suspicious behavior. Despite your best efforts and due diligence, it’s still possible to become the victim of a holiday scam—but don’t panic!
If you notice unusual activity on your accounts or find out your device has been compromised, you can minimize the damage by taking the following steps:
- Alert your banks and credit institutions.
- Report the crime to local law enforcement.
- File a complaint with the FBI.
- Report the scam to the Federal Trade Commission.
Don’t Let Scammers Steal Your Joy This Holiday Season
Don’t let fraud dampen your holiday spirits. The important thing is to take extra care when making holiday purchases to be mindful of your surroundings and the platforms where you store your banking information.
Stay protected from holiday fraud by following these expert tips and sharing them with loved ones to lessen the risk of compromising important financial information. Then, check out The Ultimate Holiday Budgeting Checklist & Planner from FSCB for further guidance on smarter spending and saving.