Consumer Handbook: Reported online retail fraud losses to approach $380M in 2022
Better Business Bureau warns online shoppers searching for gifts and other merchandise to arm themselves with research and use credit cards to dodge scammers. Online shopping scam reports to BBB Scam Tracker remain just under all-time highs reached in 2021 when BBB issued an in-depth study, Theft on a Massive Scale: Online Shopping Fraud and the Role of Social Media, last December.
Since the pandemic, shoppers remain susceptible to online retail fraud that entices shoppers with hard-to-find items, promises of low prices and easy delivery, according to reports by consumers to BBB. Emotional purchases, like wedding dresses or pets, can cause consumers to ignore red flags.
Federal Trade Commission data mirror BBB's findings, and if trends continue, financial losses across North America may reach more than $380 million. Though monetary losses to scams appear down overall, they remain high compared to pre-pandemic years. Nearly 36% of all online retail fraud reports to BBB Scam Tracker originated through a fake website.
Scammers used social media and email to initiate about 40% of reported scams. Fraudsters found the shift to online shopping to be lucrative and convenient, molding their efforts into various forms meant to trick shoppers. Items consumers receive may be completely different or worthless when compared to those advertised. Some scammers impersonate a legitimate company to convince shoppers to send money before they realize they are dealing with a fraud. Or they may target companies themselves, infecting businesses' website payment portals with e-skimmers that collect credit card information.
Here are tips for researching online retail sellers. Search for online reviews. Look at Scamadviser.com to learn how long a website has been in operation. A recently created website may be a red flag. Review the website's URL for misspellings or other errors.