So far this year, Australians have lost almost $12.9 million to online shopping and classifieds scams, and the ACCC is warning customers to be wary of shady bargains as a pre-holiday sales approach.
There were over 26,000 reports of online shopping frauds, which is higher than the entire number of reports in 2020. It is consistent with worldwide trends beginning in 2020 when more individuals were making purchases online due to the epidemic.
“This is a highly busy time of year, and fraudsters frequently try to take advantage of naive customers rushing to buy gifts,” said ACCC Deputy Chair.
“People are frequently looking for the best discounts online, particularly around Black Friday and Cyber Monday sales, so it’s easy to get caught off guard and fall for a scam.”
Scammers establish realistic-looking fraudulent web storefronts selling things at significantly discounted rates, but the items are bogus or never delivered to consumers. Scammers have also set up bogus storefronts on social media platforms or posted bogus classified advertising on reputable classifieds websites. In addition, they may demand payment or provide discounts for payments made via direct bank transfers or cryptocurrencies.
Before you buy, you should be informed of the likelihood of a fraud. While some fraudsters attempt to appear authentic by demanding payment by PayPal or credit card, always double-check that the genuine PayPal platform is being used. Also, be wary of “too good to be true” deals and merchants that request payment by bank transfer, gift cards, or cryptocurrencies.
Experts suggest that, “You do your homework and know who you’re buying from. Look for the product or company name plus “complaint” or “scam” to see what others say. Check the seller’s history and read reviews from other individuals who have interacted with them if you buy through a social networking site.”
They continue by stating that, “When paying, avoid agreements that require upfront payment by bank transfer or digital money, such as Bitcoin. Always use a secure payment provider like PayPal or a credit card transaction,”
If you’re waiting for a package, keep in mind that fraudsters prey on individuals who await delivery. “Australia Post and other parcel delivery businesses will never contact, phone, or text you requesting personal/ financial information or payment.” “Rather than clicking on links in texts or emails, many delivery businesses provide applications where you can monitor your items,” specialists in the delivery industry mention.
Losses from online shopping scams affect people of all ages, but persons aged 25-34 were hit the most, losing a total of $2.4 million. The number of reports involving financial loss has fallen this year, showing that more individuals recognize and avoid online shopping scams. Still, those who do lose money are losing more, with an average loss of more than $1,450, compared to $1,190 last year.
Some of the most severe losses surfacing this year involve high-priced purchases:
When it comes to online purchasing scams, pet frauds were the most commonly reported and the most financially destructive. So far, there were over 2,800 reports and about $3.5 million in losses, a 78% increase over the same period last year. Vehicle sales scams cost more than $1.9 million in losses, while other typical goods included caravans, shipping containers, and gadgets, including laptops, phones, and gaming consoles.
This year, shipping container scams became a new trend, defrauding consumers of almost $676,000. They were popular on classified sites and marketplaces, but fraudsters also constructed bogus websites and appeared to have legitimate ABNs. As a result, there were plenty of measures taken by authorities to remove certain fraudulent websites.
People who believe they have been defrauded should alert their bank or financial institution as soon as possible. Likewise, if the fraud happened on a social media site, contact the platform and warn them of the situation.
Understand your consumer rights.
We encourage individuals to know their consumer rights if something goes wrong, even if the item was purchased during the sales season.
Our legal team advises, “Remember that you have consumer guarantees under the Law, so if you’ve gotten a present or purchased anything in the sales and the goods stop operating or aren’t as advertised, you are entitled to a remedy depending on the nature of the problem,”
They further added, “If you have a problem with your goods, contact the store first. They cannot refuse to assist you by referring you to the manufacturer. Your local state and territory consumer protection agency can give further information about your rights and may be able to help you and the vendor settle.”