The holiday season is filled with joy, celebration, and the thrill of gift-giving. However, amidst this excitement, it’s important to be aware of potential scams that can dampen the holiday spirit. From fake websites to phishing schemes, scammers employ various tactics to steal your money or personal information. By staying informed and vigilant, you can ensure a joyful holiday shopping experience. Here’s a guide to recognizing holiday shopping red flags and protecting yourself while gift buying.
The Surge of Holiday Scams
Christmas shopping is a prime opportunity for fraudsters for several reasons:
- Increased Online Shopping: The National Retail Federation (NRF) forecasts that winter holiday spending will grow to $979+ billion in November/December 2024. According to the NRF, online shopping is expected to be the primary contributor to overall retail growth. With more people shopping online, cybercriminals have a larger pool of potential victims.
- Tight Deadlines: The rush to find last-minute gifts makes people more likely to fall for “too-good-to-be-true” deals or expedited shipping offers.
- Distracted Consumers: The holiday season is busy, leaving shoppers less attentive to red flags.
Top Holiday Shopping Scams and How to Spot Them
1 Unbelievable Discounts on High-Demand Items
If a deal seems too good to be true, it likely is. For instance, if you see a brand-new iPhone being sold for half the price, or a designer handbag at a fraction of its retail cost, be cautious. Fraudsters lure shoppers with massive discounts on popular products like electronics, luxury goods, or toys. The products might not exist, or worse, they could be counterfeit.
Holiday Shopping Red Flags:
- Prices significantly lower than other retailers.
- Limited stock warnings paired with urgent calls to “Act Now!”
- No verifiable reviews of the website or seller.
Tip: Research the average market price of items and compare deals from reputable retailers. For big-ticket purchases, stick to trusted websites or official stores.
2 Fake Online Stores
Fake e-commerce sites mimic legitimate retailers, often with professional designs and enticing offers. Once you make a purchase, your money is gone, and you’ll likely never receive your order.
Check For:
- URLs with subtle misspellings (e.g., “walm0rt.com” instead of “walmart.com”).
- Lack of contact information or customer service channels.
- Missing or poorly written return and refund policies.
Tip: Look for security indicators like “https://” in the URL and a padlock icon. Read reviews about the site before making any purchases.
3 Social Media Shopping Scams
Platforms like Instagram and Facebook are flooded with ads throughout the season promising exclusive holiday deals. Some lead to fake stores or phishing sites, while others deliver subpar goods.
Warning Signs:
- Sellers with little to no history or reviews.
- Overly positive reviews that seem generic or fake.
- Pressure to complete the purchase through direct messages or unsecured payment methods.
Tip: Only click on social media ads if you can verify the seller’s credibility. Use secure payment methods and look for established accounts.
4 Phishing Emails and Texts
During the holiday season, your inbox may be flooded with promotions, shipping updates, or order confirmations. Scammers exploit this by sending emails or texts designed to steal personal information. These messages often contain malicious links or attachments.
Signs of a Fraud:
- Poor grammar and misspellings in the message.
- Requests for personal or payment information.
- Links directing you to unfamiliar or unsecured websites.
Tip: Instead of clicking on links, go directly to the retailer’s website or use their official app to verify order details.
5 Holiday Gift Card Scams
Gift cards are a popular holiday gift and a favorite tool for scammers. Fraudsters may tamper with cards in stores or trick victims into purchasing cards and sharing the codes. Scammers may also ask for payment through gift cards, claiming it’s a fast and secure method. Once they get the gift card code, the money is untraceable and non-refundable.
Signs of a Swindle:
- Requests for payment in gift cards by strangers or fake companies.
- Offers requiring you to buy gift cards for discounts or sweepstakes entries.
Tip: Only purchase gift cards directly from the cashier from reputable retailers to avoid tampering, and never share the code with anyone you don’t trust.
6 Holiday Charity Fraud
While the season inspires giving, scammers exploit this generosity by creating fake charities. They often use emotional appeals to pressure you into donating quickly.
Don’t be Deceived by:
- High-pressure tactics like immediate payment requests.
- Vague explanations of how funds will be used.
- Charities that aren’t listed on official sites like Charity Navigator or Guidestar.
Tip: Verify the legitimacy of charities before donating. Choose organizations you’re familiar with or research them thoroughly online.
Ten Steps to Protect Yourself While Holiday Shopping
- Stick to Trusted Retailers
- Research a Seller on BBB.org/Look for Reviews
- Use Secure Payment Methods
- Enable Two-Factor Authentication (2FA)
- Monitor Your Credit Union and Other Financial Accounts
- Avoid Public Wi-Fi for Transactions
- Update Your Software/Operating Systems/Antivirus
- Be Wary of Time-Sensitive Offers
- Use a VPN Rather than Public Wi-Fi
- Expand Your Knowledge of Common Scams & Report Fraud to the FTC.
By staying informed and following the recommended precautions, you can spot holiday shopping red flags and ensure a scam-free holiday season.
Read more scam safety tips like this in our blog, “Unveiling the Surge in Crypto Investment Fraud.”