BY Iowa Attorney General Tom Miller
The holidays are quickly approaching and that means you’ll likely be adding gifts to your physical and online shopping carts.
This year, however, shopping may look a bit different amid supply chain shortages and shipping delays. Then there are the ever-present scammers lurking in the shadows, waiting to take advantage of your generosity.
Before you start your shopping, consider these tips and watch out for scams to ensure your holiday season doesn’t fall victim to a grinch.
1. Shop Smartly Online
This holiday season, some sought-after items could be hard to find as a result of supply-chain issues.
The FTC recently reminded consumers who may be scouring the internet for their hard-to-find gifts to be vigilant when making purchases through online marketplaces or with retailers you’ve never heard of before.
If this sounds like your plan, here are some things you can do to avoid a scam or negative experience:
- Check the rules about refunds and returns, and what happens if there’s a problem. Does the site have processes to help you get a refund if you don’t get exactly what was advertised or never get the item?
- Make sure they let you pay with a safe payment method. For example, credit cards have legal protections, or a secure online payment system can protect you in case there’s a problem. If someone tells you to pay with a wire transfer, gift cards, or cryptocurrency, stop and find another seller. That’s how scammers tell you to pay.
- Don’t buy from anyone who wants you to pay outside the marketplace’s payment system. If you do, you’ll lose any protection the site offers, and you probably won’t get the item or a refund.
- Find out other people’s experiences. Search online for the site’s name with words like “complaint” or “scam,” and check to see if any well-known websites have credible and impartial reviews of the marketplace or the seller.
- Look for pictures of the actual item and read the description of its condition and location.
If you still run into issues, the FTC suggests trying to work with the seller. If that doesn’t work, make a report with the marketplace. Additionally, if you paid by credit or debit card, file a dispute with your credit or debit card company.
2. Avoid ID Theft
Shopping online can save you time and maybe even money, but it also gives scammers an opportunity to steal your money or personal information.
The FTC warns that it can be easy for scammers to put up a fake website that looks a lot like a real one. These scam websites may show up in your search results or may appear in an email that looks like it came from a company you trust but takes you to a fake site.
Keep these suggestions in mind when doing your online shopping:
- Instead of clicking on a link in an email, type in the store’s URL yourself, so you know where you’re headed.
- Only pay on sites with URLs that start with https. The “s” means your transaction is encrypted — but scammers know how to encrypt, too. So don’t believe that a site is the real deal just because the site uses encryption.
- Only share personal information that you must. Most sites don’t need your home address, your age, or access to your contacts. And none of these companies needs your bank account or Social Security number.
- Pay by credit card. It gives you more protections if something goes wrong.
- Review the Return Policy. Before you order online, understand the site’s exchange and return policy, including whether the retailer charges a restocking fee and who pays for return shipping.
3. Be wary of unexpected emails and calls
Sure, we all like to receive a surprise in the mail, but not all surprises are welcome, or legit. As we warned earlier this year, scammers have become more sophisticated in their attempts to impersonate retailers,
Phishing scammers lure their targets into a false sense of security by spoofing the familiar, trusted names and logos of established, legitimate companies, such as Amazon.
According to the FTC, from July 2020 to June 2021, reports about Amazon impersonators increased from 16,000 the previous year to about 96,000. Nearly 6,000 consumers said they lost money. Reported losses topped more than $27 million with the reported median individual loss totaling about $1,000.
In the form of an email, these scams claim that expensive items, such as a television or laptop, have been made on your account and are on the way to your home.
The emails often encourage the recipient to call a number with queries about the purchase. When the consumers make the call, the help center operator informs the caller they would need to send money before a refund could be established. In some cases, the scammers make it appear that a refund has been deposited in the victim’s account, but it’s all fake.
In another type of phishing scam, the FTC warns that scammers will send emails or text messages supposedly from FedEx or UPS that an item is ready to ship but you need to update your shipping preferences. Like other phishing scams, these fraudsters are looking to gain access to your information. If you click on a link or download the attachment, you’re likely to end up with a virus or malware on your device that steals your identity and your passwords.
Avoid any holiday confusion and follow these tips:
- Don’t click. If you get an unexpected email or text message, don’t click on any links — or open any attachments. If you think it could be legit, contact the company using a website or phone number you know is real. Don’t use the information in the email or text message.
- Guard against malware. Make sure you keep your software up to date. Set your security software, internet browser, and operating system (like Windows or Mac OS X) to update automatically.
4. Know the rules to using gift cards
Gift cards are a popular option for the hard to buy for person in your life. While they provide recipients the flexibility to purchase what they want, when they want it, there are a few things to keep in mind before your make such a purchase:
- Retail gift cards can be used only with the issuing merchant.
- Bank gift cards are issued by a bank or financial institution (through the Visa, MasterCard, American Express, or Discover networks), and can be used wherever the network’s credit cards or debit cards are accepted.
- Retail gift certificates are issued by a merchant for goods or services with that merchant. They’re generally issued on paper, as opposed to a card, and they entitle the recipient to goods or services.
As we’ve warned before, it’s important to use your gift cards in a timely manner. If a retailer closes before the gift card is used, you may be out those funds, and if you don’t use the card within a year, it could be subject to inactivity or service fees.
5. Make your donations count
Whether supporting your favorite charity or making contributions in the name of your loved one, many consumers make donations during the holiday season. In fact, there’s an entire day – Giving Tuesday – dedicated to supporting non-profits.
Be aware: Your generosity could be met by someone else’s greed. Fraudsters sometimes prey on donors and their good nature. But that doesn’t mean you should stop giving; just do your research first.
The Federal Trade Commission suggests taking the following steps to ensure your charitable contributions aren’t Scrooged away:
- Do some research online. Search for the cause you care about – like “hurricane relief” or “homeless kids” – and phrases like “best charity” or “highly rated charity.”
- When you find an organization that interests you, search its name plus “complaint,” “review,” “rating,” or “scam.”
- Then, look at the reports and ratings about that charity at BBB Wise Giving Alliance, Charity Navigator, CharityWatch, and GuideStar. These sources can help you confirm that you want to donate to that organization.
- Check with your state charity regulator to make sure the organization is registered with them — something that most states require. Find their contact information at nasconet.org.
If you’re looking to give on a smaller scale, you might find appeals on social media or crowdfunding sites intriguing. While many of these requests are legitimate, there are some bad actors out there.
The safest way to give on social media or through crowdfunding is to donate to people you actually know who contact you about a specific project. Don’t assume that solicitations on social media or crowdfunding sites are legitimate — even when they are shared or liked by your friends. Call or contact your friends offline and ask them about the post they shared.
How to file a complaint:
If you believe you’ve been scammed or you suspect a charity is acting fraudulently, contact your local law enforcement agency or the Iowa Attorney General’s Consumer Protection Division. To file a complaint, go here or call 515-281-5926 (in Des Moines area) or 888-777-4590 (outside the metro area).