2021 Holiday Shopping Scams: What To Watch Out For

Marketers aren't the only ones who know how to play on that rush of excitement you get from scoring on holiday shopping deals. (Supplies are limited! These prices won't last!) Scammers know shoppers are more likely to respond to urgency and scarcity, too, and this year, a backed-up supply chain is adding to the sense of urgency.

Knowing the latest scams can help you avoid scammers who are trying to steal your money and gain access to your accounts. Here's what to watch out for while doing your holiday shopping online.

7 Holiday Shopping Scams To Avoid

Every year, the holiday shopping surge is a big opportunity for retailers. This year is no exception. According to Adobe Analytics, the weekend after Thanksgiving alone was expected to bring in $20.8 billion (PDF). With all those shoppers ready to spend their money, scammers see a big opportunity, too.

These are just seven of the current scams you might encounter when you log in for that great deal:

1. Xbox Series X / PS5 Scams

For the past year, Xbox Series X and PlayStation 5 have been in short supply because of the ongoing computer chip shortage and supply chain problems. It's so tough to get your hands on these gaming consoles that tracking inventory restocking has become a bit of a game itself.

Twitter has become a popular source of information about restocking, but beware. Never buy an Xbox or PS5 console from an account selling them on Twitter because it's probably a scam.

A few legitimate Twitter accounts track when reputable retailers have these systems in stock, and you can set up notifications so you know as soon as these accounts tweet. Newsweek and The New York Times' Wirecutter both recommend following @MattSwider or @Wario64.

2. Lookalike Websites

Unfortunately, scammers seem to have gotten better at web design. If your fingers are moving too fast on your keyboard while you're typing a web address, simple misspellings can take shoppers to fake websites that look just like the real thing. You might also find yourself on a lookalike website if you click the link for a special offer in a text message or email.

If you log in from the link, you could end up inadvertently giving the scammers your username and password to the legitimate site. If you make a purchase on the imposter site, the scammers will have your credit card or debit card information.

To avoid these problems, consider bookmarking the real shopping sites you use often so you don't have to type in the URL. Also, as a rule, never go to the retailer's website by clicking a link for a deal in an email, text message or on social media. Instead, go directly to the site you've bookmarked.

Sure, the deals are going fast, but taking the time to make sure you're on the right website before you give away sensitive information will ultimately save you time, money and lots of headaches.

3. Free Gifts

If you're already on the hunt for online holiday deals, what better time for scammers to tempt you with fake offers for free gifts and prizes? These scams are likely to come to you through your social media feed, by text and by email. These scams aren't new, but they tend to appear more often during the push for holiday deals.

According to the Better Business Bureau, scammers might promote a giveaway on social media. To enter, all you have to do is like or comment on the post. The more likes and comments a post gets, the more legitimate it looks to other users and the platform's algorithm. Once the fake giveaway has gotten enough attention, the scammers will change the content to include a malicious link or promote "spammy products."

The U.S. Federal Trade Commission outlines helpful tips to keep you from getting scammed. Two big takeaways about claiming free gifts and prizes: You should never have to pay, and you should never have to give your bank account or credit card information.

4. Fake Shipping Notification

Scammers are betting on an increase in online holiday shopping to take advantage of people with fake shipping notifications.

These scams often work by alerting you with an email or text message about a problem with a package. They might include a tracking link that takes you to a login page that looks like a major shipper's website. You'll be asked to provide your username and password or credit card information. Don't fall for it. UPS and FedEx both say they will never ask you for personal information or payment information through unsolicited texts and emails.

Before you click, look closely at the link in the message to see if it's really the shipper's website. If it's in an email, mouse over the URL and make sure the link is really from the site it says it's from.

UPS, FedEx and the U.S. Postal Inspection Service provide tips on their websites for how to avoid these types of scams. UPS also shows examples of fraudulent emails and text messages (PDF).

5. Phishing and Smishing

Phishing and text phishing (also called smishing or SMS phishing) scams are a year-round risk, but scammers use the urgency of holiday shopping deals to put a holiday spin on their efforts. The main goal of a password phishing message is to get your login credentials or account information.

One common holiday version of a phishing or smishing message will offer free gift cards if you provide personal or financial information. For emails, look carefully at the sender's address before you open the message. If you don't recognize it, the best thing to do is not open it and send the message to junk or spam mail. If you do open a phishing email accidentally, don't click on any links. For text messages, it's best to avoid clicking links.

Another type of phishing message you might encounter is a fake notification of a problem with an online order. If you didn't order anything from the seller, that's a red flag. If you're not sure, go directly to the seller's website and log in to view your orders from there. Still unsure? Contact the seller directly by phone, email or chat that you find on the seller's website, not from the email or text message you received.

Amazon, a popular company for scammers to impersonate, provides information about how to differentiate legitimate messages from fraudulent ones.

6. Auction Sites

If you're having trouble getting your hands on a must-have item, auction sites might start to look appealing. These websites claim to have items that are in high demand that they will sell to the highest bidder. Although not all of these sites are scams, they are a popular way for scammers to take advantage of the urgency and scarcity of holiday shopping.

Auction site scams work by tricking you into thinking you have the winning bid and taking your money for products that never ship.

If you decide to go ahead with an online auction site, do your homework to avoid internet auction fraud. Find out as much as you can about how the auction works and what your recourse is if something goes wrong. The FBI advises checking with the Better Business Bureau to see if the auction company is legitimate, and never give out your social security number or driver's license number to the seller.

7. Gift Card Scams

Gift card scams work two ways: When scammers sell you a fake gift card and when scammers require you to use a gift card to buy a fake item.

To avoid these scams, only buy gift cards from stores you know and trust. The FTC recommends against using online auction sites to buy gift cards because you might end up with a fake or stolen card.

Scammers will try to convince you to pay with gift cards because they're like cash and they are difficult to trace: Once the money is gone, it's usually gone. Scammers will play on the urgency of a deal expiring soon, but paying with a credit card won't take any extra time, and if something goes wrong, you can usually work with your credit card company to reverse the charges.

To protect yourself, only spend gift cards at the retailer the card is for. Never give the gift card number or pin to the seller.

Tips To Protect Yourself From Holiday Shopping Scams

Scammers use many of the same tactics during the winter holidays as they do during other times of the year. Here are a few basic steps you can take to protect yourself this holiday season:

• Never give your login information, including user IDs, passwords or authentication codes in response to emails, text messages or passwords.
• Look carefully at email addresses of senders and web addresses in links. Make sure they are spelled correctly. Sometimes scammers will change an address by one letter. Even better, don't click links in the message. Go directly to the retailer's website and check your order information there.
• Pause for a moment. No deal is worth giving away sensitive personal information or account information to a scammer.
• Assume that if a deal is too good to be true, it probably is.

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