The year-end shopping season brings time with the family, large amounts of food, gifts galore – and scams.
With the convenience of online shopping, consumers need to consider the possibility of identity theft. Other holiday rip-offs might not seem as obvious – disguising themselves through advertisements, fake charities or gift cards – but they are a threat nonetheless.
According to an October National Retail Federation survey, one-quarter of consumers plan on completing 26 percent to 50 percent of their year-end shopping online this year. Mierzwinski recommends the use of credit cards – not debit cards – when shopping online; money comes directly out of a customer’s account when purchasing with a debit card.
If someone is a victim of identity theft while using a credit card, he still will have to undergo an investigation to validate the fraud, but he won’t lose the money in his account.
“You have more rights by law with a credit card than a debit card,” Mierzwinski said.
Other important tips:
-Make sure your shopping sites are legit: National Consumers League executive director Sally Greenberg said consumers should check the legitimacy of online shopping websites, especially when buying from unknown stores, and read the return policies. The goal before making a purchase, according to Greenberg, is to “get a sense that they’re the real thing.”
Make sure the shipping costs seem reasonable; hooking customers with excessive shipping costs is another form of a scam, she added.
Consumers should make sure the websites they use for sales transactions begin with “https,” according to John Breyault, a National Consumers League vice president who specializes in telecommunications and fraud policy. “Be wary of merchants who link you to sites in emails,” he said.
-Be wary of cut-rate pricing: Online advertisements for merchandise priced well below the product’s typical cost are a trick used by scammers looking to get personal identification from consumers, or to install malware – software that performs unwanted tasks and gathers private information – on their computers.
As a precaution, Breyault said, people should have their antivirus software up to date when shopping online; he also recommended using stores’ smartphone applications when checking prices, because they are more secure than searching the Web.
-Watch out for charity scams: Phone calls and websites can solicit information from donors by posing as charities, and then steal from those who fall for the trap.
Mierzwinski said potential donors can use websites to check the legitimacy of charities, including GuideStar USA Inc. (www.guidestar.org) and CharityWatch (www.charitywatch.org). Fraudulent charities can disguise themselves by using names and Web addresses similar to real ones.
In terms of phone calls and emails from charities, Breyault recommended hanging up and deleting the emails. “If you’re thinking about donating to a charity,” Breyault said, “[it’s better to] go to that website on your own.”
Mierzwinski said that other charities might be legitimate but still have unusually high costs, often because they do not directly send their funds to the cause and instead distribute them among employees.
-Be careful with gift cards: Gift cards’ popularity stands at an all-time high, according to a National Retail Federation survey, which found 81 percent of consumers plan on purchasing them this season. The amount expended on such cards has increased by more than four percent since last year; buyers spent an average of $157 last year and are expected to spend an average of $163 this year.
Consumers need to act cautiously because scammers can copy or use portable scanners to get the code of a gift card and place it back on the rack. When consumers purchase the cards and activate them, the thieves can discover the values and take advantage online or in stores.
“My advice would be to only buy gift cards that require a PIN to use, and verify that the package hasn’t been opened or tampered so the PIN is still secure,” Mierzwinski said. “After the card is loaded, you can have the clerk scan it to confirm its value. Also, give the purchase receipt to the recipient as proof and tell her to also register the card online.”
Greenberg’s advice: “Use common sense, do your homework and look at the fine print before you spend your hard-earned money.”