10 Big Scams That Put Your Holidays In Jeopardy
The holidays are the peak time for shopping and gift-giving and scammers are already on the prowl for their next victim. Consumers face nightmare scenarios like expecting a package that never comes or seeing fraudulent charges on their credit card, putting their celebrations and savings accounts in jeopardy. But consumers can fight back to prevent con artists from ruining the festivities and save the holidays.
1. Counterfeit products
If you’ve seen a coveted gift like an iPad, makeup palette or purse for a rock-bottom discount online, beware as you’re probably not getting the real thing. Scammers often use inferior materials or shoddy electronics that could make these gifts unsafe for your intended recipients. For example, fake makeup or fragrances can contain toxic ingredients like arsenic or cadmium, according to the FBI.
How to avoid scammers: Buy directly from the manufacturer’s store or from authorized sellers of brand name products. If buying from a third-party, check ratings and reviews before your purchase to see if other people have been scammed.
2. Charity scams
The holidays put shoppers in a giving spirit, but some scammers take advantage of this goodwill with fake charities. They may cold call unsuspecting people or approach them in front of stores or on busy streets. Instead of going to great causes, donations go straight into the tricksters’ wallets and you don’t receive any tax deductions as a result.
How to avoid scammers: Check out Charity Navigator’s list of fake charities before donating. Look up the name of the charity on Guide Star’s website detailing information on nonprofit organizations to determine if it’s legitimate and the funds are going to where they should.
3. Gift card fraud
The National Retail Federation estimates 56 percent of consumers will purchase gift cards this holiday season, but this popularity makes them very vulnerable to scammers. Thieves can steal physical gift cards from the store, write the card numbers down or use a magnetic strip reader and then place the cards back on the display. They can also scratch off the PIN code associated with the card. Once a customer purchases and activates the card, thieves can check the gift card balance online and transfer it to a different card or drain the account.
How to avoid scammers: Inspect the card for signs that the card has been tampered with, such as a scratched off PIN, before leaving the store area. Purchase gift cards that are secure behind a glass case instead of an open display where thieves can grab cards. Keep the receipt in case you or your gift recipient notice strange activity to increase your chance of a refund.
4. Data breaches
Retailers are a big mark for cybercriminals, especially during the holidays, leading to data breaches. It’s hard to forget the data breach that hit Target in late-2013 that impacted millions of customers during the peak holiday shopping season. Breaches can expose financial data like debit and credit card numbers and personal information, such as names and home or email addresses.
How to avoid scammers: Use cash or a credit card instead of a debit card when shopping. Credit card companies typically provide fraud protection for consumers. In the event of an unauthorized purchase with a credit card, you are only liable for up $50, Federal Trade Commission states. If you used a debit card, you may be liable for all the money stolen from your account.
5. Email phishing
Phishing is not new, but con artists are always changing their approach to swindle victims and steal their identities. Emails can claim you’re the winner of a giveaway or you owe money to a debt collector or the government. These emails may appear like they’re from authentic people or organizations, but the websites they link to are designed to take your information or install malware.
How to avoid scammers: Whatever the phishing scam, do not respond to requests for money or your personal information and stop yourself from clicking on links or opening attachments. You can forward suspected scam emails to email@example.com or file a complaint with the FTC if you believe you’re a victim. In addition, you can report these fake messages to the real organizations they’re impersonating.
6. Card skimming
Card skimming is a simple yet financially devastating scam affecting ATM and debit cards. The New York Times reported 2015 had the highest number of ATM fraud incidents recorded by FICO Card Alert Service. Thieves will install a card skimmer inside ATMs to steal card numbers and a camera to take images of PIN codes. Increasing this threat, there is now new skimming technology that involves a probe that connects to the ATM’s internal circuit board to more easily steal card information.
How to avoid scammers: Use ATMs that are located inside banks, which make it harder for thieves to manipulate the machines. When entering your PIN, block the pad with your hand. Make it a habit to monitor your debit card and transaction activity to report losses immediately. You are liable for just $50 if you report ATM or debit card fraud within two business days of learning about the loss, the FTC notes. But if you report it after 60 calendar days, you can lose all money stolen from your ATM or debit account.
7. Fake social media giveaways
Giveaways hosted on social media sound too good to be true – and many times they are. Travel + Leisure recently warned readers about a fictitious giveaway on Facebook targeting Southwest Airlines. Scammers made a Facebook post designed to look like it came from Southwest Airlines and promised a free trip and gift card to the lucky recipient who shared, liked and commented on the post.
How to avoid scammers: Determine if a giveaway is posted by the actual brand and not a fake page. Facebook and Twitter both feature a blue checkmark next to brand names to verify their pages.
8. Ransomware/malware infections
A malware infection on your computer or phone can make it easy for hackers to take sensitive information or even take control of your device. Ransomware is a scary type of malware where cybercriminals can lock you out of your computer or threaten to release stolen information unless you pay a certain amount of money.
How to avoid scammers: Install security and firewall software on your device and only use secure browsers and websites.
9. Phony IRS phone calls
The IRS regularly warns consumers of a scam where con artists pretend to be from the organization and call victims claiming they have a refund or that they owe money. The scammers may demand payment in the form of prepaid cards or wire transfer.
How to avoid scammers: Remember the IRS will not call, email or text you about personal tax problems. Legitimate communication from the IRS will usually take place via mail. If you received a fake phone call, report the incident to the Treasury Inspector General for Tax Administration.
10. Package thieves
The increase in online shopping during the holidays keeps mail carriers – and thieves – busy. The USPS alone anticipates delivering 750 million packages during the 2016 holiday season, up 12 percent from last year. Thieves follow carriers’ trucks to snatch up packages as soon as they are delivered or drive around neighborhoods looking for unattended packages.
How to avoid scammers: Schedule a delivery when you know you’re home or pick it up from a carrier location. You can also have the package sent at your office if that’s more convenient. If you have a security system, set it to record so you can catch the thieves.
Not all Grinches come in the color green. As this list shows, fraud and scammers come in many forms. Look out for these scams to have a safer and more enjoyable holiday.
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