Don’t Let Scams Spoil Your Holiday Season

The holiday season is upon us, and while you may be prepared to spend a little extra on gifts, food, decorations, and charitable donations during this time of year, you likely don’t have room in your budget for lost or stolen funds. Unfortunately, thousands of people each year fall prey to holiday scams – especially nondelivery and nonpayment crimes – which could leave you in a financial bind that stretches far beyond the festive season. In 2021, the Internet Crime Complaint Center reported that nonpayment or nondelivery scams cost sellers and shoppers more than $337 million and that credit card fraud accounted for another $173 million in losses.

Victims of nondelivery scams are those who pay for goods and services but then never receive them – or their payment never reaches the intended recipient. Nonpayment scams involve those who ship goods or provide services but are never paid for them.

In this article, we’ll explore five common types of scams you could encounter around the holidays so you’ll know what to look out for and how to avoid them.

1. Secure Your Special Deliveries

Billions of packages are shipped each holiday season, and online scammers have come up with several ways to steal joy – and money – from both shippers and recipients. Here are some common package-related scams to look out for:

• A text or email inviting you to click a link to track your package, get a delivery update, provide updated drop-off instructions, change your payment method or delivery date, or pay a shipping fee
• A text, email, or voicemail prompting you to call a phone number about an urgent issue related to your delivery
• A “missed delivery” note on your door with a message to call a phone number
• Any communication supposedly originating from a merchant or shipper that includes overly urgent language, misspellings, errors, and imperfect logos

Clicking a link could install malware on your device that allows a scammer to capture personal information, and friendly-sounding “customer service representatives” on the phone could be fraudsters trying to capture your cash.

Instead, call the shipping agency or retailer directly (not at the number provided in the communication), or go to your merchant’s website or app or a verified shipping website – like UPS.com, USPS.com, or FedEx.com – to check on your delivery.

2. Be On Guard for Unusual Gift Card Requests and Offers

According to the Federal Trade Commission (FTC), gift cards are the most reported payment method for scams. Fraud may come in the following forms:

• Text messages, emails, voicemails, or social media messages claiming the recipient owes money to a government agency like the IRS or a utility company demanding immediate payment by gift card
• Texts, emails, voicemails, or social media messages with the composer claiming to be a loved one who needs help in the form of gift card funds
• Texts, emails, voicemails, or social media messages claiming you have won free gift cards and requesting personal information so you can claim your prize or soliciting gift card contributions for false fundraisers for charities or causes

Tip: No legitimate government agency, utility company, charitable organization, or merchant will require payment in gift cards – so receiving a message that you must is a huge red flag. If you receive requests for gift cards from a friend or family member, contact them directly to verify. And call charities or companies directly to see if gift card offers or fundraising requests are legitimate.

If a message seems unusual or too good to be true, it probably is.

3. Sidestep Social Media Gift Exchange Schemes

 While that annual Secret Santa with your friends or coworkers can be a lot of fun, “gift exchanges” popping up on social media feeds are often illegal pyramid schemes instead. They frequently solicit personal information about you and your friends and prompt you to buy and ship gifts to others with the promise that you’ll receive great gifts in return. Beyond the initial disappointment of not ever receiving those gifts, you could also be setting yourself (and your friends) up for future scam targeting or even identity theft.

Tip: Avoid these large and “secret” gift exchanges on social media. And report these types of social media posts to both the social media provider and the Better Business Bureau.®

 4. Take a Second Look at Temporary Job Offers

Lots of legitimate companies need extra help around the holidays to keep up with increased demand. But scammers are out there taking advantage of opportunities to prey on seasonal job seekers.

Be suspicious if you see any of these elements in a job listing:

• Requests for payment for your application, training, or supplies
• Promises of high wages for routine or low-effort tasks
• Requirements that applicants work for free initially to show their skill level

Tip: As much as possible, stick to local businesses you know when applying for seasonal jobs. Avoid following up on listings that offer high pay for minimal work, request payments for your own supplies or training, or insist you work for free for a while to prove your value.

 5. Do Your Research Before You Donate

It’s the season of giving, and many people are being extra generous to the causes and charities they support. Criminals can take advantage of these good intentions by making urgent requests via email, text, voicemail, or social media, sometimes requesting contributions in unusual formats – like gift cards, wire transfers, or cryptocurrency.

Tip: To avoid falling into a fake charity trap, always investigate the organization before you donate. Sites like Charity Navigator are a good place to start. Contact nonprofits and other groups directly if you’ve received an unsolicited fundraising request. And avoid contributing with nontraditional forms of payment.  A credit card is usually a wise choice since most cards come with fraud protection.

Verify Businesses and Charities and Check for Similar Scams

 Protect yourself by checking in with these agencies to quickly identify legitimate organizations and possible scams. 

• The FTC – Its scam alert page is regularly updated, and you can enroll in email updates to stay in the know about future fraud.
• Charity Navigator – This nonprofit evaluates charities based on their financial health, accountability, and transparency and provides information about how donations are used.
• The Better Business Bureau (BBB) – Its database keeps track of scams, and you can verify if a business is legitimate by searching the business name on the BBB homepage.

What to Do You If You Think You’ve Been Scammed

By keeping a watchful eye out for potential scams, we hope you’ll be safe this holiday season. But if you ever do fall into a scammer’s trap – or think you might have – there are things you can do to reduce the impact.

• First, report the scam to local law enforcement and file a complaint with the FBI, especially if it has resulted in a large loss or if you think your personal information might be compromised, which could cause you problems in the future.
• Temporarily freeze your credit reports to prevent scammers from opening accounts in your name.
• Alert your banks and credit institutions to be on the lookout for future suspicious transactions. They may even be able to help you get your money back.
• And finally, file a complaint with the FTC to help protect others from similar scams.