FBI agent working on his computer in office
The holiday season is a time of joy and celebration, but it’s also prime hunting season for scammers. In 2024, the FBI has issued a warning to consumers about the growing risks of holiday-related fraud. With cybercriminals using increasingly sophisticated tactics and online shopping continuing to grow, more opportunities exist for fraudsters to exploit unsuspecting consumers than ever before.
Holiday Scams: Why 2024 Is a Particularly Risky Year
The FBI’s warning comes against a backdrop of record-setting online shopping activity. With holiday e-commerce sales projected to exceed $260 billion this year, scammers have more opportunities than ever to target victims. Fraudsters are deploying advanced techniques such as AI-generated fake websites and realistic phishing emails to trick even the most careful consumers.
Younger shoppers are particularly at risk. According to the Federal Trade Commission, or FTC, individuals aged 18 to 39 are 25% more likely to fall victim to online shopping scams than older adults. These shoppers, who rely heavily on e-commerce platforms and social media ads, often encounter scams disguised as unbelievable holiday deals.
The Real-World Impact of Holiday Scams
The financial stakes of holiday scams are staggering. In 2023, U.S. consumers lost $10 billion to various scams, marking a $1 billion increase from the previous year. Among these, non-delivery scams accounted for $73 million in losses, as consumers paid for goods that never arrived. Gift card fraud, another common tactic, drained $148 million from victims, leaving them with no recourse to recover their money.
The emotional toll is just as significant. Victims often report feelings of stress, anxiety, and betrayal, especially during the holidays when finances and trust are paramount. Falling for a scam can disrupt the festive spirit and cause long-lasting financial hardships.
Common Holiday Scams And How They Work
Here are some of the most common cyber holiday scams to watch out for:
Non-Delivery Scams
Among the most common holiday scams is the non-delivery scam, where fraudsters set up fake e-commerce websites or post counterfeit listings on legitimate platforms like eBay or Facebook Marketplace. These scams often target high-demand items such as gaming consoles, smartphones, or designer goods.
A shopper scrolling through their favorite marketplace spots a deal too good to pass up—a brand-new gaming console priced far below retail. Excited to snag a bargain, they quickly click “Buy Now,” enter their payment information, and anticipate the shipping confirmation. But days pass, then weeks, with no sign of the item. Emails to the seller go unanswered, and the listing mysteriously disappears from the site. It’s only after countless failed attempts to track down the seller that the realization sets in—the deal was a scam, and the money is gone for good.
Gift Card Fraud Scams
Scammers frequently target victims through gift card fraud, exploiting the season’s popularity for prepaid cards as gifts. In this scheme, fraudsters impersonate charities, retailers, or even trusted acquaintances, asking victims to purchase gift cards and share the card numbers and PINs.
A scammer might pose as a charitable organization soliciting donations for holiday meals or gifts for children. Alternatively, a fraudster could impersonate a retailer, claiming that a gift card is the only accepted form of payment for a time-sensitive deal.
Fake Charity Scams
The holiday season inspires generosity, but it also provides fertile ground for fake charity scams. Fraudsters create fictitious organizations, often using names, logos, or slogans that closely resemble those of reputable charities. They may reach out via phone calls, social media posts, or emails urging donors to act quickly to “make a difference” during the holidays.
Tactics often include emotional appeals, such as helping families in need or providing toys for children, and pushing for immediate donations, often via untraceable payment methods like wire transfers or gift cards. A survey by AARP found that 80% of U.S. consumers encountered at least one holiday-related scam in 2023, with fake charity requests being a frequent tactic.
Phishing Emails and Fake Websites
Phishing emails and fake websites are among the most sophisticated scams today, designed to deceive even experienced online shoppers. Fraudsters craft communications that appear to come from legitimate retailers, delivery services or payment platforms. They become especially dangerous during the holiday season because they exploit the unique pressures and behaviors of this time of year. The holidays are a whirlwind of online activity—shoppers are racing to find deals, track orders and manage last-minute purchases. Scammers know this, and they tailor their schemes to blend seamlessly into the frenzy.
Imagine receiving an email claiming there’s a problem with your recent order— package delay or a payment issue. During the holidays, with orders from multiple retailers in transit, it’s easy to lose track. The email looks legitimate, complete with a recognizable logo and professional formatting. Feeling the urgency to resolve the issue and avoid delivery delays, the recipient clicks the link without hesitation. They’re taken to a convincing website where they’re prompted to enter login credentials or payment details. By the time they realize the site was fake, their sensitive information is in the hands of scammers.
What makes these scams even more potent during the holidays is the sheer volume of legitimate emails consumers receive, from shipping updates and promotional offers to invoices and account notifications. This overload makes it harder to differentiate between real and fraudulent communications. Advanced techniques, like AI-generated fake websites and phishing emails that mimic corporate branding, only add to the challenge.
TransUnion’s data underscores the scale of the threat. During the 2023 holiday season, 3.6% of global e-commerce transactions were flagged as potentially fraudulent, and that number is expected to climb in 2024. With so much at stake, staying vigilant against these “digital wolves in sheep’s clothing” is more important than ever during the holiday rush.
What the FBI Recommends
The FBI’s advice to consumers is straightforward: vigilance is your best defense against holiday scams. Here is what the FBI recommends:
Verify Website URL Addresses
Shoppers are urged to verify website URLs, ensuring they begin with “https” and include a padlock icon in the address bar.
When the FBI advises shoppers to check for “https” in website URLs and look for a padlock icon, they’re addressing a fundamental scam tactic: fake websites. These fraudulent sites are designed to look nearly identical to legitimate retailers, often with minor differences in the URL—like a misspelled brand name or an added character. The “https” and padlock symbol indicate a secure connection, which helps ensure that any data you enter, like payment information, is encrypted and harder for scammers to intercept. By independently typing the retailer’s URL into your browser instead of clicking links in emails or ads, you avoid the risk of being redirected to a convincing but fraudulent site.
Be Wary of “Too Good To Be True” Deals
The FBI’s warning about unrealistic discounts highlights how scammers play on the holiday rush and desire for bargains. Massive markdowns on high-demand items like gaming consoles or electronics can create a sense of urgency—“Act now before the deal ends!” This pressure often leads shoppers to skip basic precautions, like verifying the legitimacy of the seller. Scammers thrive on this impulsive behavior, collecting payments for goods that don’t exist. The advice to slow down and critically evaluate deals helps counteract the emotional manipulation scammers rely on.
Use Secure Payment Methods
The FBI’s emphasis on using credit cards rather than gift cards or wire transfers reflects the protections built into credit card transactions. Credit cards allow consumers to dispute unauthorized charges and often provide fraud monitoring services. Conversely, payments made through gift cards or wire transfers are nearly impossible to recover once sent, which is why scammers frequently demand these methods. This advice ensures that, if something goes wrong, consumers have a safety net to recover their funds.
Verify Charities Before Donating
Holiday generosity makes charitable giving a prime target for scammers. The FBI’s recommendation to check charities through tools like Charity Navigator or the Better Business Bureau addresses the prevalence of fake charity scams. Fraudsters exploit the goodwill of the season by creating organizations that mimic legitimate ones, often with names or logos that look authentic. By verifying the legitimacy of the charity, donors can ensure their contributions go to the intended cause rather than into the pockets of scammers. This advice also helps combat emotional manipulation, as fraudulent charities often use urgent, heart-wrenching appeals to elicit impulsive donations.
Monitor the Shipping Process
The FBI advises holiday shoppers to carefully monitor the shipping process for their online purchases to avoid falling victim to scams or package theft.
The holidays bring a surge in e-commerce activity, which scammers exploit through non-delivery scams and fake tracking information. By requesting and using tracking numbers, buyers can:
- Confirm Shipment: A valid tracking number from the seller serves as proof that your order has been shipped. If a seller fails to provide one, it’s a potential red flag.
- Detect Fraud Early: If a tracking number seems invalid or unverifiable, it’s often a sign that something is wrong. Acting quickly can help you dispute charges and report scams before it’s too late.
The FBI warns that sellers also need to safeguard their transactions, especially during the holidays when scams targeting sellers increase. Be cautious with purchases where the shipping address differs from the billing address on the credit card. These mismatches often indicate fraudulent activity, such as the use of stolen credit cards. Good practices for sellers include:
- Require Cardholder Authorization: Always verify the buyer’s identity and get explicit authorization from the cardholder before shipping items to an alternate address.
- Use Secure Payment Systems: Payment systems should flag mismatched addresses for further review, helping sellers detect potential fraud early.
- Retain Proof of Shipment: Always keep tracking information and proof of delivery. This documentation is vital if a buyer disputes the transaction or claims the item was not received.
What to Do If You’ve Been Caught In A Holiday Scam
If you suspect you’ve fallen victim to a scam, the FBI urges immediate action. Start by filing a report with the FBI’s Internet Crime Complaint Center, or IC3. Next, contact your bank or credit card provider to dispute fraudulent charges and secure your accounts. If sensitive personal information was stolen, consider placing a fraud alert or credit freeze on your credit file to prevent further misuse.
The FTC also offers resources for reporting scams and recovering from identity theft. Reporting fraudulent activity not only helps authorities track down scammers but also prevents others from becoming victims.
The FBI’s 2024 holiday scam warning is a reminder that protecting yourself requires more than luck. It requires awareness and caution. The combination of increased online shopping, sophisticated scam tactics, and consumer distractions creates a perfect storm for fraud. By staying informed, verifying suspicious offers, and using secure payment methods, you can ensure a safer shopping experience this season.