Bamboozled: December 21, 2015

moneyWith only four shopping days left until Christmas, lots of shoppers are behind on their to-do lists.

People who are in a rush will look for short cuts, and they won’t always do their research before making a decision. It’s human nature.

But it also makes consumers more susceptible to scams.

So before you head to the mall or to your computer with your credit card, slow down for a moment and be armed with knowledge.

Here’s a look at three problems to avoid as you hurry to finish your holiday shopping.

Shopping scams

Let’s start with all those emails you receive.

Offers for coupons and free gift cards have been filling the Bamboozled mailbox in recent weeks. They appear to come from large retailers, including Macy’s, Kohl’s and Bed Bath and Beyond.

And they’re all fakes.

The emails are not really from the merchants, but from fraudsters who are trying to steal your private information.

How?

If you click on the supplied link, you’re exposing your computer to viruses. Hackers may plant a bug that could later freeze your computer, setting you up for a future “tech help” fraud. Or the hackers may outright be able to search your computer for account numbers, passwords and other data that will make it easy for them to steal your identity.

“These malicious links can lead to you downloading what is known in cybersecurity parlance as payloads,” said Mitch Feather of Creative Associates, a Madison-based cybersecurity and infrastructure consulting firm. “These payloads might be information-stealing Trojans, downloaders, or rootkits – to name a few. They can be designed to get you to surrender your banking and/or credit card information.”

Others tempting emails don’t offer coupons, but instead dangle a free gift card. You’d have to complete a survey to get your freebie.

If you do, you’re handing over your information to potential bad guys. Some of these “survey” sites will ask you to create a user name and password. If you’re like most people, you probably use the same user names and passwords for lots of sites. When the scammers get yours, they can try those user names and passwords on a host of sites — including your online banking and other financial sites — and they may end up with easy access to your money.

Some shopping surveys are the real thing, though, and of course lots of retailers offer coupons. But if you didn’t sign up on the retailer’s web site to request to be on a mailing list, it’s best to delete the emails without clicking.

Fake eBay and Amazon sellers

There’s nothing wrong with eBay or Amazon, but scammers use those sites, and others like them, to make fake sales to consumers.

Shopping marketplace web sites offer their own products, but they also show the wares of third-party sellers. Most third-party sellers are legit, and you can see customer rankings and the seller’s history.

But those items didn’t help one scam victim Bamboozled wrote about last year, and we keep getting emails from consumers who fell for similar frauds.

The consumer, who wanted to buy a generator, had emailed with a seller through Amazon’s messaging system. When it came time to buy, the customer clicked a link that was in one of the messages, and rather than take him to Amazon’s payment system, it took him to Western Union.

Thinking it was legit, he made the payment, but he never got the generator.

He later learned that Amazon had no record of the transaction because it didn’t take place on its site, and the customer was duped.

The lesson here is that if you make any purchases through online marketplaces, make sure you pay through the actual marketplace’s payment system. Beware of any seller communications that come outside of the marketplace’s system, such as to your email, and make sure you’re actually on the real marketplace’s site and not a fake site before you enter your credit card information.

Amazon offers customer protections for purchases from third-party sellers, but only if you use Amazon Payments for the transaction.

Same goes for eBay, which also offers protections. If you’re using eBay, look for signs that you’re on the real eBay and not a phony site that impersonates eBay.

Feather said you should also watch out for “phantom stores,” which he said are very good at getting your credit card information and your money, but you’ll never see the products you order.

Unhappy returns

Consumers have probably noticed more and more companies will ask for a driver’s license before issuing a return.

They insist on scanning the license before taking back merchandise.

It’s part of the retail world’s attempt to eliminate return fraud.

Your retailer is probably using technology from The Retail Equation (TRE), a California-based company that helps businesses track customer behavior. Part of what it offers is a system to track returns so merchants can keep a closer eye on so called “serial returners.”

The TRE website says that 1 percent of consumers display behaviors that mimic return fraud or abuse, which it says is a $10.8 billion to $17.6 billion problem every year in the U.S.

For the 2015 holiday season, retailers expect to lose an estimated $2.2 billion to return fraud, according to the National Retail Federation. The group also said it estimated 3.5 percent of holiday returns would be fraudulent this year.

So if you shop at a retailer that uses the TRE system, the cashier will scan your government-issued ID — usually your driver’s license — and the system takes a look at your return behavior, including how often you make returns.

“[The system] enables retailers to rely on objective, verifiable data to determine whether a return is valid rather than relying on subjective observations and guesswork by sales clerks,” TRE’s website says. “This objectivity ensures that only those with highly suspect return-and-exchange behavior are affected. The vast majority―approximately 99 percent―of returns are accepted.”

TRE says exactly what the scan captures varies from state to state, depending on state and local regulations. It will usually include an identification number, name, address, date of birth and expiration date.

What happens to that information?

TRE says it stores your info in a “state-of-the art, secure data center located within the continental United States.”

Bamboozled has written about this system before.

Back then, we reached out to several major retailers to ask what they do to keep scanned information secure, and none of the companies wanted to talk about it. We didn’t try again this time.

So as you make your holiday purchases, if you know you’re not crazy about the idea of someone scanning your driver’s license and storing the information, be sure to review return policies before you buy. If you don’t want to present your license for a return, shop elsewhere.

If you already made the purchase, when you head back to return it, you have the right to refuse to present your license. Just don’t expect you’ll be permitted to make the return.

If you’ve been denied a return and you want to see what kind of return profile is kept on you, you can email The Retail Equation to request your “return activity report.” Email returnactivityreport@theretailequation.com to make the request.

Have you been Bamboozled? Reach Karin Price Mueller at Bamboozled@NJAdvanceMedia.com. Follow her on Twitter @KPMueller. Find Bamboozled on Facebook. Mueller is also the founder of NJMoneyHelp.com. Stay informed and sign up for NJMoneyHelp.com’s weekly e-newsletter.

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