It’s the most wonderful time of the year! The holiday season is fast approaching and that means that the holiday shopping season is in full swing.
Whether you’re looking for the perfect gifts for your loved ones or donating to a cause, the holidays bring increased spending across the country. Unfortunately, scammers see this time of year as an opportunity to prey upon unsuspecting shoppers.
The Federal Trade Commission (FTC), which showed a 25% increase in fraud compared to the prior year, driven by holiday and year-end scams.
With a significant increase in fraud attempts during the holidays, it is important to stay vigilant when shopping both offline and online and understand what to look for to protect your personal information.
In this article, we’ll break down the most common types of fraud spotted around the holiday season and how you can protect your debit or credit card safety this season.
Common Credit Card Scams
The holidays are a busy time for retail stores and shoppers, but also for scammers. Credit card scams are a significant risk to consider around the holidays. There are various tactics scammers use, including, but not limited to:
-
Stealing credit card information through data breaches to make unauthorized charges
-
Phishing scams posing as banks or government officials to login codes or credit card numbers
-
Fake online stores with unrealistic deals to steal credit card information
-
False refund notifications that install malware for stealing personal information when the links are clicked
These scams often start with small unauthorized charges, then escalate to larger fraudulent transactions. Holiday travelers can also be targeted through fake travel booking sites that aim to steal credit card details.
It’s essential to keep your personal information, such as passwords, financial documents, and social security numbers, confidential. Stay vigilant online by verifying links, reading shopping sites thoroughly before purchasing, and when in doubt – trust your instincts. If it looks and feels suspicious, it probably is.
Other Forms of Holiday Fraud
We talked about the most common forms of credit card fraud during the holidays, but here are a few other forms of holiday fraud to be aware of this season:
-
Gift Card Scams: Gift cards are an easy and convenient item to give during the holidays. Gift scams occur when fraudsters tamper with physical cards in stores or request fake payments via gift cards. When you’re in-store, be sure to look for any tampering on the gift card before purchasing it. Check the PIN number and make sure that it is still covered by its original coating. Scammers can steal the PIN and the card number and when you add money to the card, they can draw it to their own account.
-
Charity Scams: The holidays are not only a great time to surprise others with gifts, but it’s a time to give back with time and money to charities that assist those in need. While this amount of generosity is great to see, some scammers have taken notice of this and will disguise themselves as charities to take your money for their personal gain.
Use caution if an organization asks for donations in the form of gift cards, wire transfers, or even straight cash. Reputable organizations will not be this upfront about how they want you to donate and will not ask for gift cards or wire transfers.
It may also be wise to do your research on the organization(s) you want to support. Most organizations will have a website where you can view their mission statement and what your donations will go toward. The Better Business Bureau (BBB) and the Internal Revenue Service (IRS) allow you to search organizations to determine their validity. You can also check Charity Navigator, a nonprofit that evaluates charities based on their financial health, accountability, and transparency.
-
Package Delivery Scams: Online shopping is becoming the main form of holiday shopping and packages are constantly being delivered by companies such as Amazon, the USPS, FedEx, and UPS. Scammers try to take advantage of this by pretending to be a delivery company and attempting to get you to click on a malicious link to steal your personal information. Watch out for texts or emails from any delivery company telling you that your package has been delivered, has an issue, or is missing a payment. Check the message for any spelling errors or strange wording. If you are unsure and concerned, reach out to the delivery company directly.
-
Money App Scams: For some, instead of buying specific gifts, they will just send money to their friends or family so they can buy what they want. This has become easier than ever before with the introduction of third-party money-transferring apps such as Cash App, Venmo, or our partner here at Elements, Zelle®. Since these apps are connected to your debit cards or bank accounts, they are typically targeted by scammers year-round.
It's best to avoid using your money app for merchandise during the holidays and be wary of sites that only accept payment through these apps.
Since these are third-party systems and not actual financial institutions, if you make a transaction that turns out to be a scam, it is unlikely that you will be able to get that money back.
Additionally, never share your passcode or account information with anyone. If you receive a text or call from what appears to be your financial institution asking for this information, do not send any money and contact your credit union as soon as possible.
What do I do if I think I’ve been scammed?
If you feel that you have been scammed, it is important to take the necessary actions to limit the damages caused and to protect yourself from any more issues that could be faced.
-
Contact your credit union or bank immediately: If you sent the scammer any money or account information, call your financial institution and let them know that you have experienced fraud. Ask that the transaction be canceled and if it has already gone through, you may be able to dispute the payment in an effort to get your money back.
-
File a complaint with the Federal Trade Commission: Let the FTC know about the scam that you have experienced via a complaint to inform them of what is going on. This will allow them to protect others from experiencing the same scam. The FTC will provide you with the proper steps to take to potentially get your money back.
-
Freeze your credit reports: Scams that steal your personal information and not just your money can be dangerous when it comes to your credit reports. If you feel that your personal information was stolen, freeze your credit reports immediately. Doing so will block the scammer from opening any accounts using your information, which could tarnish your credit scores.
Have questions or need to report suspicious activity? Our credit union experts are always here for you. Contact Elements Financial for fraud support year-round. From everyone at Elements, may you enjoy a safe, healthy, and happy holiday season!
