Hooked on Online Shopping? Beware These Common Scams | Refresh Financial

Hooked on Online Shopping? Beware These Common Scams

online shoppingShopping online is easy. With the click of a button, you can have anything you need, delivered right to your door in just a few days. It saves you time, gas, and money. For many Canadians, making purchases on the internet is a regular part of life. We get so used to it, that we tend to forget, the internet is full of people who want to take your money, some of whom are willing to go to any route to do so.

There are so many scams that make the rounds on the internet, designed to deceive you out of your money while you're online shopping, that it’s hard to be aware of all of them. But, if you limit your online shopping to the big name sites, there are only a few common scams you should keep your eyes peeled for:

The Hidden Subscription

So, you’re scrolling Instagram and you see an ad for a free trial amount of a product. It could be self-tanning lotion or anti-aging cream. Usually, the product is in the health and beauty category. But you see that all you have to do is pay the shipping and you get to try this new, amazing product. So, you figure, what’s the harm? You click through and place your order and nothing seems out of the ordinary, so you feel fine about your decision. The product arrives in the mail and it’s nothing all that special and in a few weeks, you’ve forgotten about the whole thing. That is until you check your credit card statement and notice a $300 charge to it from some place you’d never heard of. Of course, the first thing you do is initiate a chargeback. You didn’t authorize that payment, did you? The thing is, you did. Somewhere in the terms of service when you purchased your sample, there was an agreement to sign up for a monthly subscription to the product - each month the product gets delivered to your mailbox, and you get charged the full price. Unfortunately, there is no way out of this one. You can fight your credit card issuer over it for months on end, but in the end, the retailer still has your agreement to sign up for the subscription.

The lesson: don’t get suckered into free samples. There’s always a catch. Also, read all the terms and conditions on every online purchase you make.

The Amazing Price

This one happens often on Amazon. You see a great price on something that is usually ten times the amount it’s selling for. You think, “Hey, why not? It’s just a few bucks”. Then you get a tracking number in your email and an assurance the product is on the way. A few weeks go by and you start to wonder where it is though, so you check your tracking number and the shipping service is telling you there’s no such number. It hits you that maybe you ought to read the reviews for this particular seller on Amazon, and the picture suddenly becomes clear. Everyone is posting negative comments about fake tracking numbers and never receiving their purchases. Luckily on Amazon, your purchases are protected, and you will get your money back, providing you take notice and action, but it doesn’t make the whole process any less of a pain in the neck.

The lesson: if the price seems too good to be true, it probably is. Read the seller reviews on Amazon if you’re online shopping for something that is not fulfilled by Amazon itself.

The Weird Payment Methods

This one is most common on auction websites like eBay or places like Craigslist. When you’re asked to pay by money order, bank transfer, etc, it’s usually a good sign you’re being scammed. In this day and age, everyone who is capable of selling something over the internet is also capable of accepting money via the services that protect the consumer, like PayPal or Amazon. There is absolutely no reason to ask for a money order or bank transfer, so if someone asks, run away as fast as you can.

The lesson: only pay by methods that offer consumer purchase protection, such as PayPal, Credit Card, and Amazon. That way, if the seller fails to send the product, you get your money back.

The New Seller

Often scammers on websites such as Amazon and eBay get found out pretty quick and have their accounts and shops shut down. The problem is, there is nothing stopping them from just simply starting up a new one. On Amazon, in particular, there is a known scam where sellers constantly put up new shops with new items for sale, with no intention of shipping a single thing. The goal here is to collect your personal information either for resale to marketers or to use for their own marketing purposes. Once you’ve purchased something from their shop, they have your name, phone number, and address and soon you might notice an influx of telemarketers calling your number.

The lesson: always check out sellers on Amazon before you buy and refrain from buying anything from new shops.

The Password Heist

You’re going to be targeted for this one via email. It’ll look like it comes from a reputable source. Perhaps it’s PayPal, maybe Apple, or Amazon. It’s going to tell you that there’s something wrong with your account or your recent purchases and ask you to go to the site to correct it. The problem, is that while the site you end up on will likely look legitimate - it’s usually a near-exact replica of a page from Apple or Amazon or PayPal, except it’s not actually on any of those sites. It’s on the scammer's site, and when you go to enter your login and password, it will be recorded and now the scammer can get into your accounts and use your payment methods.

The lesson: Don’t click links in emails asking you to login to your account to fix something wrong with it. If you really want to know if there is a problem, type the website into your address bar in your browser manually. For instance, if the email claims to be from Apple, just go to Apple.com manually from your browser and login from there. Always check the URL (website address) of links you’re entering your login credentials into.

Sadly, more and more scams pop up every day on the internet, so the absolute best four actions to take to make sure you’ve not been scammed are:

  1. Only use reputable sources when you're online shopping and double check that you are actually on their official website before entering personal or payment information.
  2. Change your password often and use a generator to come up with strong passwords, like this one: https://passwordsgenerator.net/
  3. Look at your credit card activity as often as you can, as well as other payment methods. If you do become the victim of a scam, you want to find out ASAP.
  4. Obtain your credit report as often as you can. Staying on top of what’s in your credit report is going to allow you to catch anything strange associated with identity theft.

If you regularly practice these four habits, you’re going to be a much more difficult mark for a scam when you're online shopping. You can also stay on top of the most common scams on the internet via the scam alert page on the American Federal Trade Commission website.

Have you ever been a victim of a scam online? Let us know how that turned out in the comments!

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