E-Commerce Scams

In brief

E-commerce is convenient and fast. The well-known platforms are growing rapidly while still leaving a small space for new platforms to develop. However, the Internet seems to be a lucrative market for a growing number of criminals.          

The most widespread scams

Classic online scams include the following:     

  1. fake shops simply extorting money from their “customers”.   
  2. real shops selling fake products.
  3. real online shops can be harmful without actually engaging in scams.

Each of these basic situations can give rise to different scenarios. The following are among the most common:

1. Fake shops: the goods never arrive

There are online shops that look very professional with a perfectly good website but offering fictional products. Likewise, some scammers publish real estate ads or ads for cars at unbeatable prices. But, in reality, the goods are not available.

Result: loss of time and money

Best practice: Never pay for goods in advance. Use secure payment means (on receipt of invoice, on delivery or using electronic payment system (e.g. PayPal)).

Beware of:

  • extremely low prices,
  • obligatory advance payments or transfers (e.g. Western Union),
  • over-complimentary or over-critical customer testimonials,
  • incomplete legal information,
  • difficult or impossible to contact,     
  • an invitation to make payment to an account abroad that does not match the country from which the item is to be shipped.

Check the reliability of the online shop (for example, use WOT) and read the testimonials of other customers.

Advance fee fraud

Advance fee fraud has countless variations involving all types of products. But the scam is always the same: you are asked to pay before you receive the purchased item. The justifications are more or less reasonable, such as insurance for unforeseen transport costs or advances for “logistic brokers”.

Advance payment fraud

In this case, the vendor insists on full payment in advance, usually by Western Union or other form of money transfer.

“Fiduciary” scam

This type of scam uses a third party as the “logistics partner”. This “partner” manages the delivery and the transfer of money. But the partner is actually an accomplice of the vendor and is merely pretending to be a “trusted third party”, in order to scam customers more convincingly.

False logos, labels and evaluations

Quality labels, professional photos of products, well-known company logos, positive comments … A host of signs of trust that encourage customers to buy, but are sometimes malicious or falsified.

2. Real shops – False products

Long distances and the display of virtual products allow fraudsters to use the Internet to sell fake products. A professional photo of the item can make the description even more credible. But what you see is not necessarily what you get.

Result: Loss of money, security risks, goods blocked at customs.

Good practice: Beware of excessively low prices. Buy only from the online shops of brands. Do not pay for goods until you have received them.

Be aware that online shops that are not genuine often omit their head office, making legal action and claims impossible.

Counterfeit branded products

The online market is flooded with counterfeit products of famous brands. These products are seriously deficient in quality and may involve serious safety issues.

Falsified or absent CE labelling

For an order from abroad, confirm that the product has a valid CE label. This is particularly important for multimedia devices, electronics, toys, telecommunications accessories, light bulbs, etc. Absent or false CE labelling is illegal and is a major safety risk. Customs will seize imports where CE marking is absent.

3. Trustworthy shops… But with a catch.

Legitimate online stores can also be very expensive for the user, even if they do not engage in scams.

Result: Loss of time, money and data, identity theft.

Good practice:

  • Check whether the displayed price includes additional costs.
  • Check the reliability of the online shop.
  • Read the terms and conditions and the small print (the contractual conditions must be transparent and understandable).
  • Use a strong password for each online shop. If you pay by credit card, use a card specifically for this purpose, with a payment ceiling. The order should be placed over a secure connection (https).
  • Regularly monitor the accounts used in order to detect unusual transactions.

Hidden costs Customs, taxes, shipping costs, insurance … Even if the price of the item is low, additional costs can be very high. Shipping costs and insurance can be particularly high. These costs can vary greatly from one vendor to another.

Long delivery times Online shops may sell goods that they do not yet have. Some shops may wait to receive a large number of orders before sending them to the wholesaler. This means they can avoid storage and scrapping costs.

Irritating consequence for the buyer: extremely long delivery time …

Compromised shops E-commerce sites are very popular with online hackers. When an e-commerce site is compromised, customer data may be stolen, including logins, passwords, and credit card numbers. Vendors and customers don’t realise until it is too late.

What if this happens?

  • If you have been the victim of fraud through an online shop in Luxembourg, contact ULC (Union of Consumers of Luxembourg).
  • If you have been the victim of fraud through an online shop in the EU, contact the CEC (European Consumer Centre).

You should also file a complaint for online fraud with the police.

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