An increase in online shopping activity during the COVID-19 pandemic has resulted in a huge 500 per cent increase in losses to scams for that category in 2020 statistics compiled by WA ScamNet at Consumer Protection.
In 2020, 257 online shoppers in WA reported total losses of $653,745, compared to 129 victims losing $127,304 in 2019.
There was also a doubling of losses and the number of scam victims in the ‘classifieds’ category with 241 consumers who were looking for second-hand goods losing a total of $544,172, compared to 126 victims losing $191,792 in 2019.
Overall, there were more scam victims but less money lost in 2020 with 952 victims losing $11.8 million. In 2019, there were 705 victims reporting $13.6 million in losses. As in most years, investment ($5.38 million) and romance ($2.17 million) scams topped the list of categories.
Commissioner for Consumer Protection Lanie Chopping said the huge amount of money lost to scams is a blow to the local economy and devastating to victims.
“Money that could have flowed to legitimate local businesses is being syphoned by criminals who are very efficient and professional in their deception to dupe consumers,” Ms Chopping said.
“Posting fake ads, creating fake websites and sometimes threatening their victims by phone are just some of the many tactics used to steal money from people. It’s vital that the community is aware of these tactics to prevent these criminals from being rewarded by their criminal activities.
“WA ScamNet has a high level of success in getting fake websites, classified listings and social media pages closed down. For example, recently about 30 puppy scam sites were deleted by a domain host company after being approached by our Consumer Fraud Liaison Officers.
“With online shopping and internet activity generally increasing year by year, particularly during COVID-19 restrictions, it is even more important that consumers are vigilant and do some checks to ensure the people or organisations they are dealing with online are legitimate. This is especially important if money is changing hands”
Looking at demographics across all categories, it is interesting to note that the largest losses have occurred in the 25-34 age group while the highest number of reports have come from the 65 and over group.
Another alarming statistic from the 2020 report is more than a million dollars, a four-fold increase on 2019, has been lost to calls from scammers pretending to be government agencies, such as the ATO or Services Australia, threatening arrest or a telco threatening disconnection unless a bogus debt is paid immediately.
Payment redirection or ‘man in the middle’ scams continue to be of major concern with 39 people reporting total losses of about $750,000 in 2020.
“This scam involves the hacking of email accounts and the cloning of addresses, so when there are financial transactions such as payment of an invoice or purchase of a property, the scammer impersonates one of the parties by sending a fake email that requests funds be sent to the scammer’s bank account instead,” the Commissioner said.
“A simple solution to this scam is to verify by phone any email request for money, especially if a change of bank account is involved.”
General advice to avoid becoming a scam victim:
• Don’t let anyone pressure you into making urgent decisions;
• Always get a second opinion from a trusted and reliable source if someone is requesting money;
• Do not respond to emails, text messages and phone calls from strangers offering predictions on shares, investment tips or investment advice – always do your own research and use licensed advisors;
• Know who you’re dealing with on dating sites – watch out for profiles on social media and dating websites of scammers claiming to live in your area, but can’t meet due to travel or moving away, and never send money to someone you haven’t met in person;
• Never allow anyone to remotely log into your computer;
• Take a moment to think about how an organisation is asking you to make payment – government agencies and businesses will never ask you to make a payment using iTunes, Google Play or gift cards or in Bitcoin.
Information and advice on scams is available on the WA ScamNet website