The sneakiest new shopping scams

Consumer Reports

View photo

.

Just as important as knowing how to sniff out great buys is understanding what it takes to avoid rip-offs. And with Internet fraud on the rise, it's getting tougher to outsmart the criminals.  Complaints to the Internet Crime Complaint Center, a joint operation of the FBI and the National White Collar Crime Center, jumped 22 percent last year. The complaints include plenty of run-of-the-mill scams, like sellers who steal credit-card numbers or take the money and run. But those are child's play compared with what else is brewing.

More from ConsumerReports.org

Store brands vs. name brands

Get the best price on anything

Consumer Reports has no relationship with any advertisers or sponsors on Yahoo!

Think you're too savvy to get taken? OK, maybe you don't fall for those e-mails from Nigerian royalty asking you to wire money, but digital criminals are getting sneakier every year. One scam that can trip up even the most cautious consumers involves "skimmers" attached to ATMs. Those devices record account numbers and passwords so that thieves can clean out your bank account.

"These guys are constantly thinking of new ways to swindle you, some of which are quite sophisticated," says Brian Krebs, a computer security expert and author of "Krebs on Security" at Krebsonsecurity.com.

Think you're safer shopping at the mall? Official purse-snatching statistics show there's been a downward trend, but many of those crimes aren't reported to law enforcement officials. And pickpocket activity always jumps around holiday time, says Bob Arno, co-author of "Travel Advisory! How to Avoid Thefts, Cons and Street Scams While Traveling" (Bonus Books, 2003). But you can outsmart even the craftiest swindlers if you know what's in their bag of nasty tricks. Here's a guide to the latest, sneakiest scams, and simple tips that can help you protect yourself.

'Smishing'

How it works "Phishing" is when you get an e-mail from a supposedly trustworthy source, such as your bank or PayPal, claiming a problem with your account and asking for your user name and password. When you respond, your information is stolen and your account is siphoned. "Smishing" is the latest twist on that scam—instead of getting an e-mail, you get a text message. (The word is a combination of "SMS," for short message service, aka text messaging, and "phishing.") You're told to call a toll-free number, which is answered by a bogus interactive voice-response system that tries to fool you into providing your account number and password.

"It works because people don't give their cell-phone numbers out," Krebs says. "If someone has my cell number, I figure it's someone I know." Thieves can use random-dialing telemarketing services to hit on your number, says Rod Rasmussen, president and CTO of IID, an Internet security firm. If you belong to a credit union, be especially wary—members are targets because often the call-back number has a local area code, not an 800 number, which makes victims less likely to suspect a hoax, Rasmussen says.

Prevent it If you get a text alert about an account, don't respond before you verify that it's legitimate. You can do a Google search on the number to see whether it matches your financial institution. Even better, call the customer-service number at your bank or other service provider to give any needed information to a representative.

Teeny, tiny charges

How it works Thieves get hold of your credit- or debit-card number and make very small charges of 20 cents to $10. The charges appear on your bill with an innocuous-sounding corporate name, and a toll-free number may appear next to the charge. But when you call the number, it's either disconnected or you're instructed to leave a message and your call is never returned.

That was precisely the scam that the Federal Trade Commission broke up in June, according to spokesman Frank Dorman. "We don't know where the thieves got the card numbers, but we're looking into that," he says. The scam was successful because most consumers either didn't notice the charges or didn't bother to correct them because the amounts were so small. In all, the crime ring racked up more than $10 million in bogus charges, the FTC estimates.

Prevent it Scrutinize every item on your bill every month, and question those you don't recognize. (Some charges, but not all, will list a phone number.) If you think a charge is fraudulent, notify your card company as soon as possible but no later than 60 days after the charge appears. By law, the card company must remove the disputed amount from your account while it investigates. Worst case, by law you're liable for only the first $50 on a credit card. (In most cases, Visa and MasterCard will cover the full amount.) Debit cards offer fewer protections: You must report the problem two days after you notice it. If you don't, you could be liable for the first $500 in fraudulent charges. If you wait more than 60 days after your statement is mailed, you could lose all the money in your account.

Skimmers

How it works Skimmers, devices that thieves attach to ATMs or gas pumps to steal your debit account number and password, have been around for years—and they're not going away. They're getting even more sophisticated.

The devices are placed at the mouth of the card-acceptance slot and record the data off of the magnetic strip on the back of your ATM card when you slide it into the machine. Crooks will usually plant a second device, such as a hidden camera or a transparent plastic PIN pad overlay, that's used to record your PIN when you type it in. In the early days of skimming, the thief had to return to the ATM or gas pump to retrieve the apparatus. But now, Krebs says, wireless technology enables the devices to be rigged to send account information via text message to the thief's cell phone. "The thief can be down the street in a coffee house or halfway around the world," he says. "As long as he's got a working phone signal, he can get the information sent to him right away and start using it."

Prevent it Use credit cards and avoid using non-bank ATMs. Those machines are generally located in areas that are less secure, making it easier for thieves to tamper with them. And check the card slot: If there's a plastic strip or plastic film sticking out, or anything glued to the card reader, go elsewhere. If your card is stuck inside the card slot, do not leave the machine. Use your cell phone to call your bank branch or the 24-hour service number to report the problem.

Membership programs

How they work You're buying from a large, reputable website but just before you click the "confirm" button on your purchase, you see a pop-up window or banner ad with an offer such as "$10 Cash Back on Your Next Purchase!" Here's the catch. By accepting that so-called deal, you're agreeing to enroll in a Web discount program that's run by a completely separate company. Those programs, which have innocuous names such as "Reservation Rewards," "Travel Values Plus," or "Great Fun," often provide a 30-day trial period during which you get discounts on a variety of merchandise and services. After that, a monthly membership fee, usually $10 to $20, will appear on your credit-card bill—even though you never gave that outside company your card number.

Sounds dicey, doesn't it? A Senate committee headed by Jay Rockefeller, D-W.Va., thought so, too. Last year, the committee launched an investigation into three large companies that sell memberships to those discount clubs: Affinion Group, Vertrue, and Webloyalty. The committee's report was issued last November and alleged, among other things, that "misleading 'Yes' and 'Continue' buttons cause consumers to reasonably think they are completing the original transaction, rather than entering into a new, ongoing financial relationship with a membership club operated by Affinion, Vertrue, or Webloyalty."

The problem is so ubiquitous that in May, Rockefeller introduced a bill to ban that and other misleading sales practices. Meanwhile, the three companies mentioned in the report have pledged to change their ways. Previously, customers' credit-card numbers were provided to the discount company by the original site without the consumer's knowledge. After the investigation began, all three companies started to require consumers to type in, at a minimum, the last four digits of their card number to make it clear that they are entering into a separate transaction. We'll be on the lookout for whether those changes are enough to keep consumers from being duped.

Prevent it Be wary of pop-up windows or banner ads that promise an additional discount before you complete a transaction. If you do click on an offer, take the time to read the fine print. Scrutinize your credit-card statement every month and question any unfamiliar charges, no matter how small. Check your e-mail inbox and spam folder because Web loyalty programs often send a notification e-mail before they start charging your credit card, when you still have time to cancel.

Stripped gift cards

How it works Thieves look for gift cards that are displayed on grab-and-go racks, such as in grocery and department stores. They use a handheld scanner—which you can buy online for just a few hundred dollars—to read the code behind the magnetic or scratch-off strip on the back of the card. That, combined with the card number on the front, gives them everything they need to steal the value of the card. Then they put the card back on the rack. Later an unsuspecting buyer purchases the worthless gift card. Even if a card isn't preloaded, a thief can steal the card number and security code, then call the 800 number shown on the card every few days to check the balance. Once a shopper has purchased the card and loaded it with a dollar amount, the thief can spend it before the purchaser does.

Prevent it Buy cards that are behind a customer-service desk, says Tom Browning, vice president of corporate compliance and chief security officer for AlliedBarton Security Services. Inspect the card; if the magnetic or peel-off strip on the back isn't pristine, the card might have been tampered with. When buying a preloaded card, ask the cashier to scan it to make sure the full value is on it. If you're buying from a third-party gift-card site, look at the refund policy. And always hang on to the receipts. If something goes wrong, it can help you—or the gift recipient—get a refund.

Counterfeit electronics

How it works Counterfeiting might seem like old news, but it's still going strong—in fact, stronger than ever. Last year, U.S. Customs and Border Protection made 14,841 seizures of fake and pirated goods worth $261 billion, an all-time high. The counterfeits seized included the usual suspects—footwear, apparel, and accessories—plus a huge number of electronics. "A knockoff handbag may not present a direct risk to consumers," says Anthony Toderian, spokesman for CSA International, which tests and certifies products, "but counterfeit electronics certainly do." Fake goods could have substandard wiring, faulty fuses, flammable plastic casings, and harmful chemicals such as lead and mercury. All kinds of electronics have been illegally copied, including computers, phones, and handheld gaming devices, he says. Although online shopping and auction sites and deep-discount stores are the most likely places those fakes will pop up, some have made their way onto the shelves of major retailers. "Buyers for stores can be fooled just as easily as regular consumers can," Toderian says.

Prevent it Look for a label stating that the product has been certified by CSA International or Underwriters Laboratory. (Go to CSA -International. org and click on "Certification Marks" to see what genuine labels look like. At UL.com, go to the search box and type in "How to spot fakes.") Look at the product, too. Are there misspellings on the package? If the box is see-through, does it contain all of the listed components, including batteries, cases, and power cords? Is the manufacturer's contact information, including address and phone number, clearly displayed? When in doubt, buy from well-known retailers that offer a full refund.

3 simple ways to protect yourself

Get the right security software In recent tests, we found two great, downloadable programs that protect against viruses, spyware, and other online threats at no charge. Try Avira, at www.free-av.com, or Microsoft Security Essentials, at www.microsoft.com/security_essentials.

Fight fraud There are several useful resources for ensuring your online safety. Bookmark these!

FTC.gov The Federal Trade Commission's site has lots of fact sheets that tell you what to do you if you've been scammed. Under the Consumer Protection tab, click on "Consumer Information" and then "Shopping for Products & Services." Don't miss the helpful primers on what to do if you're billed for merchandise you never receive and "How to right a wrong."

Safeshopping.org This site is sponsored by the American Bar Association and is packed with advice on safe payment methods, protecting your privacy when you shop, and other need-to-know topics.

OnGuardOnline.gov This site has tips on Internet shopping and is sponsored by government agencies. Quizzes test your knowledge of spyware, online auctions, ID theft, and more.

Antiphishing.org The Anti-Phishing Working Group, an industry-sponsored association, has a tip sheet on how to avoid being scammed. Click on "Consumer Advice," then "How to Avoid Phishing Scams."

Check sellers Before you do business with anyone, go to the Better Business Bureau, at www.bbb.org/us. Grades A to F are based on how long the seller has been in business and how good a job it does resolving complaints. Other sites that are worth a look include SiteJabber.com, Complaints.com, and RipoffReport.com, for its user reviews. Also do a Google search of the site or retailer and the word "complaints."

Hang on to your handbag!

Bob Arno, an author and anti-theft consultant, has traveled the world secretly filming pickpockets. So he knows their tricks and how to thwart them. Here's his advice:

Get a grip Thieves are just as likely to snatch your purse as to slip a hand inside it to grab a wallet. So keep your handbag tight against your body and in front of you at all times. And when you're sitting down in the food court at the mall, don't sling your purse behind you on the chair. Even if you think you're maintaining physical contact with your bag, leaning forward for just a second is all the opportunity a thief needs to grab it. And never put it on the floor, even if it's in front of you.

Nix knapsacks They're back in style, but any bag that's not within your view is a juicy target for skilled pickpockets, no matter how securely it's fastened. And avoid purses with open compartments. Bags with zippers are best.

Keep your focus A classic ploy of purse thieves is to create a diversion—pointing at something, talking loudly, holding open a map and asking for directions, or spilling something on your coat then offering to clean it up. It can happen in a restaurant or a busy mall. Whenever anyone approaches you, be sure to firmly hold your purse and keep it in front of you.

Pare down your wallet Do you really need to bring all of your credit cards and ID cards with you? Leave everything except the necessities at home. And never routinely carry around anything with your Social Security number on it. (Photocopy all of the cards in your wallet, just in case.)

Be smart with your car Park in well-lit areas. If it's still daylight but you plan to shop for a while, park under a street lamp or in a well-lit garage. Always put up your windows and lock the car. If you go back to your car to stow packages, put them in the trunk—visible boxes and bags are magnets for thieves. Don't load up with so many packages that your purse dangles from your arm, out of your sight. Take advantage of curbside pickup or ask the store to hold bags for you. If someone tries to grab your purse, don't resist. "It's not worth losing your life over," Arno says. Also, if you have a GPS device in your car, program it so that your "home" setting isn't your home address. Instead, use the school or church down the street, or crooks will know how to get to your house while you're out. GPS thefts are also on the rise, so don't leave any visible trace of one in your car, including the mount.

Check sellers Before you do business with anyone, go to the Better Business Bureau, at www.bbb.org/us. Grades A to F are based on how long the seller has been in business and how good a job it does resolving complaints. Other sites that are worth a look include SiteJabber.com, Complaints.com, and RipoffReport.com, for its user reviews. Also do a Google search of the site or retailer and the word "complaints."

ShopSmart;) the unique shopping magazine, offers unbiased, easy-to-read advice on the best brands of household appliances, kitchenware, electronics, and more. Subscribe today!

Copyright © 2006-2010 Consumers Union of U.S., Inc. No reproduction, in whole or in part, without written permission.

Sorry you didn't like this comment. Please provide a reason below.

Are you sure?
Rating failed. Try again.
Request failed. Try again.
We will promote constructive and witty comments to the top, so everyone sees them!
Sorry, we can’t load comments right now. Try again.

    Recommended for You

    • Alex Rodriguez Shares Sweet Photos from Daughter Ella's Birthday Party

      The baseball star and his daughters spent time in the Dominican Republic with Jennifer Lopez and her kids earlier this month.

      Entertainment Tonight
    • Black-eyed mugshot of Lancaster County suspect gets national attention, disbelief

      A police mug shot taken in Lancaster County, S.C., is drawing attention across the country for what appears to be a blond woman with black eyes. The mug shot is of 24-year-old Morgan Joyce Varn, who faces charges of kidnapping, armed robbery and property damage in Lancaster County. She remained in the Lancaster County jail Friday without bond. It is the kind of case that typically doesn’t get attention beyond county lines, but the story was being picked up across the nation Friday due to Varn’s striking image: Full head of blond hair, pale forehead covered in tattoos, and the whites of her eyes appearing to be black and reflective like glass. Social media commenters quickly picked up on the photo,

      The Charlotte Observer q
    • Hasan Minhaj Makes Brutal, Biting Swipes at Trump During White House Correspondents Speech

      Hasan Minhaj delivered a brutal and biting monologue about President Trump at the White House Correspondents Association Dinner, in an appearance that was as much a statement as it was a bit of satire. Minhaj said that Trump does not respect the First Amendment. “The man who tweets everything the enters his head, refuses to... Read more »

      Variety
    • Anthony Joshua gets up off canvas to knock out Wladimir Klitschko at Wembley Stadium

      Anthony Joshua stopped Wladimir Klitschko in round 11 of one of the best heavyweight fights in ages in front of a record crowd of 90,000 at Wembley Stadium. IBF world champion Joshua looked to have the edge in the first four rounds before scoring a knockdown in the fifth which brought the entire stadium to its feet. Klitschko actually finished the round strong enough to potentially cancel out the 10-8 score a knockdown usually brings, before dropping the champ himself in the sixth – the first time Joshua had been put on the canvas.

      Yahoo Sport UK
    • North Korea Test-Fires Another Ballistic Missile, Defying World Leaders

      U.S. and South Korean officials said the test, from an area north of the North Korean capital, appeared to have failed, in what would be the North's fourth straight unsuccessful missile test since March. The test came as the USS Carl Vinson aircraft carrier group arrived in waters near the Korean peninsula, where it began exercises with the South Korean navy on Saturday, just minutes after the failed launch, a South Korean navy official said. Tillerson, in a U.N. Security Council meeting on North Korea on Friday, repeated the Trump administration's position that all options were on the table if Pyongyang persisted with its nuclear and missile development.

      Newsweek
    • MIT grad fell to his death trying to pull a prank

      He was by all accounts brilliant — except for last week, when he tried to pull off a daring stunt that ended his life. A Massachusetts Institute of Technology graduate died Wednesday when he fell to his death on campus, as he tried to climb the Great Dome — a time-honored tradition of one-upsmanship at the prestigious Cambridge university, authorities said. Computer programmer Nicholas Paggi — a 2015 MIT grad and a Bayville, New Jersey native — was with roommates who are MIT graduate students when he fell. “He came down the side of one of the roofs, came across the front and slipped going back up the other side,” his mother, Helga Paggi, told CBS in Boston from her home in Toms River, New Jersey.

      New York Post q
    • Delta Air Lines Pilot Hits Passenger During Fight at Atlanta Airport (UPDATE: NEW VIDEO OF CONFRONTATION)

      9:30 AM PT -- A rep for Delta tells us ... "We became aware of this incident and a video last week and immediately removed the pilot from duty while we completed a thorough investigation. Local law enforcement was called to respond at the time of the incident. The pilot has since been returned to work as our investigation found that his actions deescalated an altercation between passengers on the jetway floor during deplaning." We're told the women in the vid had gotten into a skirmish earlier, on the airplane, and they knew each other. They were eventually escorted away by a Delta employee, and as they were walking away, cops showed up. We're told neither of the women wanted to press charges

      TMZ q
    • 'Horrifying' death of fourth man executed in Arkansas leads to demands for inquiry

      The execution of Kenneth Williams in the US state of Arkansas on Thursday (27 April) has stirred a controversy after his lawyers called for an inquiry alleging that the lethal injection procedure was "horrifying". Media persons who witnessed the procedure said that the convicted murderer coughed, trembled, lurched and jerked about 15 times after he received the first of three lethal injections. Williams' last words were "I humbly extend my apologies to those families I have senselessly wronged".

      International Business Times
    • United Airlines Is Offering Super-Cheap Flights

      Round-trip flights are as low as $364.

      Cosmopolitan
    • Mom Says Stranger Pulled Her Daughter Out of Class, Berated Her

      A Virginia mother is demanding answers from officials at her daughter`s high school after she says a school resource officer helped a complete stranger pull her daughter out of class and confront her about an alleged stolen phone.

      Tribune
    • Britney Spears standing on her BF’s shoulders in a pool is the most impressive thing we’ve seen all week

      Well, we’re definitely impressed. Britney Spears posted a pool stunt on Instagram that showed how incredible her balance is. Of course, she…

      Hello Giggles
    • People's Climate March across the U.S. (19 photos)

      Thousands of people across the U.S. are marching on President Donald Trump’s hundredth day in office to demand action on climate change. In Washington, D.C., large crowds on Saturday made their way down Pennsylvania Avenue in sweltering heat. They planned to encircle the White House. Organizers say about 300 other protest marches are expected around the country. Participants in the Peoples Climate March say they’re objecting to Trump’s rollback of restrictions on mining, oil drilling and greenhouse gas emissions at coal-fired power plants, among other things. (AP) See more news-related photo galleries and follow us on Yahoo News Photo Tumblr.

      Yahoo News Photo Staff
    • Joshua-Klitschko classic was the kick up the backside heavyweight boxing needed

      Liam Happe was blown away by Anthony Joshua and Wladimir Klitschko's physical and emotional battle for the ages at Wembley on Saturday.

      Yahoo Sport UK
    • Reagan adviser: Trump speech deeply disturbing

      Former presidential adviser David Gergen called President Donald Trump's speech at a campaign-style rally in Pennsylvania "deeply disturbing."

      CNN q
    • Two members of alt-right accused of making white supremacist hand signs in White House after receiving press passes

      Two conservative journalists have sparked outcry on social media by making what some have interpreted as a white supremacist hand symbol at a recent visit to the White House. “Just two people doing a white power hand gesture in the White House,” Fusion senior reporter Emma Roller tweeted, alongside a screenshot of the picture.

      The Independent
    • Experts: North Korean nukes can defeat even the world's most advanced missile defense system

      "If it flies, it dies," Adm. Harry Harris told Congress on Wednesday, referring to the US's...

      Business Insider
    • Victim's family pay for Arkansas death row killer to meet his granddaughter hours before execution

      The family of a man killed by an Arkansas death row inmate paid for the convict's family to visit him hours before he was executed. Kenneth Williams, 38, was united with his daughter and granddaughter yesterday (27 April) before becoming the fourth man to be executed by the state this week. Jasmine Johnson and her daughter, three, who had never met her grandfather, were flown out after the family of Michael Greenwood, a man he killed in a traffic collision, paid for their tickets.

      International Business Times
    • Entertainment Tonight
    • Hard times for Whole Foods: 'People say it's for pretentious people. I can see why'

      Whole Foods’ share price has dropped by almost half since October 2013. Lunchtime customers at Whole Foods in Manhattan’s Union Square had little trouble expressing the shortcomings that have led the once high-flying, organic-focused retailer to become linked with a takeover. “I love the sushi, but I wouldn’t shop here except maybe for a special ingredient,” said Argentinian software designer Benjamin Vinas.

      The Guardian
    • “Logan” is coming back to theaters in a totally new way, but you better act fast to see it!

      Logan has been in theaters for two months, but it’s already getting a revamp. Yes, get excited, because Logan is coming back…

      Hello Giggles