The burgeoning world of online commerce means the world of fraud has shifted into digital. As a result there are a host of new frauds and scams that are either wholly online or use the weaknesses in online security to steal your money.
As a small eBusiness, you are at risk from the fraud being perpetrated on your customers and their stolen details being unleashed on you, buy you also run the risk of being a victim of all these scams too.
Read On:
Fraud and the law
Fraud: what exactly is it?
Seasonal returns: a best practice guide
So what are we looking at?
Online shopping fraud
Shopping and auction fraud involves fraudulent shopping scams that rely on the anonymity of the internet. As the popularity of internet shopping and online auctions grows, so the number of complaints about transactions is increasing.
Some of the most common complaints involve:
• buyers receiving goods late, or not at all
• sellers not receiving payment
• buyers receiving goods that are either less valuable than those advertised or
• significantly different from the original description
• failure to disclose relevant information about a product or the terms of sale.
As a seller you should be wary of accepting payment by cheque. Even though it may clear, you are still liable if the cheque is forged or stolen. Also, don’t accept a cheque for a higher amount and refund the difference.
This is a common fraud that only comes to light when the buyers’ cheque turns out to be stolen or forged.
Phishing, Vishing and Smishing
One of the most commons scams in the digital world, these three let would be fraudsters gather details through sending a fake email (phishing), over the phone (vishing) or via SMS (smishing).
These usually take the form of a fake contact from a bank to verify an payment or other details.
Increasingly, the fraudsters are using fake messages from PayPal, loyalty schemes and even now apps such as What’sapp and other social networks.
In most cases these messages – when emailed or SMS-ed – involve opening an attachment or a link which then delivers a form that requires the user to put in their details.
Spam emails
A more specialized form of Phishing, spam emailing involves a fairly untargeted bulk emailing to millions of people on the hope that a few will engage.
These tend to again feature phishing style messages looking for bank details or verification of details, but many use attachments to deliver malware (see below) or to infect the computer in someway.
Increasingly, these spam emails are also able to deliver their Trojan horse cargo by simply appearing in the preview window on a phone or computer. They then copy details or follow key strokes.
Click fraud
Click fraud is when a pay-per-click online advert is deliberately clicked on in order to inflate a company’s advertising bill.
Pay-per-click adverts are online adverts that company’s can pay for. Every time a company’s link is clicked from a pay-per-click advert, the company is charged.
When their pay-per-click advertising limit is reached, their adverts and links are no longer displayed. Victims of click fraud are therefore paying for advertising that is not being properly used.
Click fraud can be done manually, by an automated script or a computer programme that can imitate the actions of a real person.
Botnets
These are the networks of compromised computers used by fraudsters to run the fake websites and deliver the spam emails used in phishing and spam attacks. They increasingly look and feel exactly like the companies they are trying to emulate.
Any small business should be aware that they too are in the firing line for scammers to emulate their websites on botnets.
Malware
Malware is just naughty, unwanted software that does something bad to your computer.
Often delivered through Phishing attacks, spam emails and links to botnets, this software can silently install itself on your computer and then can either follow what you are doing to glean your log in details and personal information or it can simply start transferring your money out of your account.
It can essentially do whatever the fraudster designs it to do.
Proxy servers
Proxy servers are ‘fake’ webservers that, while they sit on the legitimate internet, they are controlled by criminals and are used to redirect you and your traffic – often including your login and customer transactions – to the botnets of criminals.
Again, you have no idea this is happening to you.
Computer Hacking
This is the unathourised access to your computer – which can include your till if you are a shop and its connected to a network – that allows criminals to steal information from that device, redirect it so that they can steal from it or simply control it.
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