With the holiday season swiftly approaching, it’s important for consumers to be vigilant about online scams.
A 2015 AARP Fraud Watch Network survey found that 70 percent of consumers did not know how to stay safe from common holiday scams, and many engaged in risky behaviors that could see them fall prey to fraudsters.
Here are a few common scams to watch for while you’re watching for the first sign of snow:
Scam 1: Calls from your own number
Yep, you read correctly. One common scam is the call from your very own number. Experts say crooks use computers to generate numbers that may be the same as a victim’s in order to trick people into picking up the phone. Often, when they do answer, what they hear is an automated recording informing them that they’ve won something (a free cruise?), or that the IRS has them in its cross hairs.
The police department in Port Lavaca, Texas, posted a warning about this phone scam on its Facebook page recently, mentioning several reports regarding the scam.
(Oh, and, by the way, here’s a note especially for millennials: Don’t think that only grandmas will victim to phone scams. Call data company First Orion found out in a survey conducted earlier this year that millennials were more likely to give away personal information over the phone than the members of any other generations, even though they were less likely to get scam calls.)
What to do: Curiosity killed the cat, right? Screen calls that seem to be coming from your own number. If you do answer, hang up if you suspect it’s a scammer.
Scam 2: Charity scams
Almost a third of charitable giving occurs during the holiday season, according to the AARP. But there’s a dark side to this trend: Consumers tend to be more susceptible to fundraising scams during this time.
With so many damaging hurricanes impacting large swaths of the U.S. this year, be especially cautious before answering calls from folks urging you to donate to hurricane relief charities or fundraising pages. Give if you like, but be on guard against fakes.
You should be sure that the money you’re donating is really going to the cause you want to support. Watch out for anyone soliciting donations by phone if you haven’t researched the caller’s cause carefully. While many calls from fundraisers are legit, some fundraisers are allowed to keep a large portion of the funds they raise on a charity’s behalf. This isn’t necessarily a scam, but it might make you think differently about contributing to a cause if you knew that a big part of what you gave wasn’t going to the cause itself.
AARP’s survey found that 70 percent of the people who made donations in 2015 did not ask how the funds would be spent, and 60 percent didn’t verify if the charities were legally authorized to raise money in their state.
What to do: Check out charities before you donate. Charity Navigator, CharityWatch and GuideStar maintain up-to-date listings of registered nonprofits, which you can use to check whether or not an organization is legitimate. Don’t give donations by phone if you’re not sure where the money is going. Ask questions when approached by fundraisers.
You should also set a budget for charity giving and decide which groups you want to support ahead of time, so you wouldn’t be caught off guard by unexpected solicitation calls.
Scam 3: Gift cards
One of the hottest holiday gift choices in the U.S., the simple gift card is hardly safe from scammers.
Scams involving gift cards come in different forms. A common scam is that thieves secretly scan or simply write down the serial numbers off the cards from in-store racks. Later, they check on whether the cards have been bought and what the balances are. As soon as a card is activated, the crooks drain money off it.
Another increasingly common form of fraud involves scammers asking for money via iTunes gift cards. They might pose as debt collectors, or as representatives with the IRS or area hospitals. In any of these guises, they’re demanding money, and fast. And, they say, they’re willing to take a gift card.
What to do: This one’s fairly cut and dried: Never trust someone who demands payment via gift cards. Purchase cards online directly from the retailers or via reputable exchange sites like Gift Card Granny or Cardpool. If you get targeted by a scam like this, report it to the Federal Trade Commission at ftc.gov/complaint.
Scam 4: Online scams
“If a deal looks too good to be true, it probably is,” the FBI warns.
Don’t be duped by fake websites set up by fraudsters to steal your personal and financial information. Criminals often use misleading shopping sites or market unrealistic deals to lure customers in. When the customer goes to check out, they may not realize that fraudsters are capturing their personal information — name, address, credit card data.
What to do: The FBI advises consumers to stay away from unfamiliar retail sites, be mindful of social media posts that offer vouchers or gift cards, and avoid opening suspicious emails or hypertext links. Scamawareness.org, a nonprofit organization, suggests making sure that a site URL begins with "https" when you are entering payment information for a purchase; this is an indication that the website is secure.
Scam 5: Fake apps
As consumers increasingly browse holiday deals on their phones, criminals are catching up with the new shopping trend. Phony apps, disguised as free games or shopping apps, are designed to steal personal information from your phone, tablet or computer..
What to do: Only purchase apps from app stores like the iTunes App Store or the the Google Play Store. Most retailers and big brands will list all their approved apps on their official website. Be sure to check their sites before downloading an app from an unknown source. If the app you’re considering seems questionable, search third-party reviews online, because there is a good chance someone who downloaded it before you might have commented about it.
Another telltale sign of a fake app: asking for a lot of permissions to gain access to your photos, contacts, location or social media profiles. Be cautious if this happens, because generally apps don’t need to access your contacts or images in order for you to buy something from them.
Scam 6: Work-from-home scams
Who wouldn’t want some extra cash to help fund their holiday shopping this year?
You might see ads for work-from-home jobs online and think, “Wow, here’s an easy way to make some extra cash.”
The truth is, opportunities for you to make extra money while working at home exist, but some ads for lucrative work-from-home jobs could be scams.
What usually happens is that fraudsters market a bogus job and ask candidates to pay upfront costs for instructions or products. Often, these jobs have a very low bar, saying no experience is required. You might also be asked to fill out a form that requests personal information, such as your Social Security number, according to scam-detector.com, a fraud prevention website.
Rather than send you work materials or further instructions, the fraudsters take your cash or personal info. You’re left hanging.
What to do: Before you sign up for any work-from-home opportunities, run a quick web search of the company or the person who has contacted you and see if any fraud has been reported before.
Think twice before providing personal information or making a payment. Don’t give away your personal information to any company if it has no real web footprint, or if its site seems haphazard and poorly constructed.
You also might try checking out a company with your local consumer protection agency, your state attorney general or the Better Business Bureau, the FTC advises.
MagnifyMoney is a price comparison and financial education website, founded by former bankers who use their knowledge of how the system works to help you save money.
