Top Digital Payment-Related Scams and How You Can Avoid Them

In these trying times of lockdowns and community quarantines, almost everybody in the world is stuck at home.

Billions of people are online, either for work, entertainment, or shopping for essential goods because most stores are closed, and grocery supplies are dwindling. Digital payments for bills, insurance, and other services will surely be taking place. For scammers and cybercriminals, the influx of all these people online means more potential targets to steal from. There have been reports that more than 4,000 COVID-19-related domains have already been registered, and more than 50% of these are bound to be malicious.

With all these new online threats, you need to know what the top digital payment fraud schemes are out there and how to avoid becoming a victim.

What is Digital Payment Fraud?

Digital payment fraud is any illegal transaction perpetrated by a cybercriminal via the internet. Threat actors use all methods of deception and impersonation to deprive their victims of sensitive information (Social Security numbers, credit cards), funds, or personal property. The crimes happen online and are sometimes augmented with phone calls. There are never any meetups or anything face-to-face.

Digital payment fraud is classified as:

• Any fraudulent transactions which the account owner never authorized.
• Claims of lost or stolen merchandise that were never purchased.
• Fraudulent refund demands, fake returns, or bogus bounced check claims.

Electronic transactions are the lifeblood of eCommerce businesses. Without e-payments, online stores and service providers won’t be able to charge their customers for products or services rendered. The increased number of people using online payments has resulted in a sharp uptick in scams and cybercrime.

List of Top Digital Payment Scams

There are many ways a cybercriminal can get you online. Here are the top types of payment fraud and how to avoid getting scammed.

Phishing

Anything online (websites, forms, emails, surveys) that require sensitive information such as bank account or credit card details and login credentials are prime targets for phishing. Scammers create fake websites that look exactly like the real one and buy domains that are almost identical to the URL of the site they want to impersonate. The domain links are spoofed to read like the original, and the files and websites get infected with malware that can harvest your details.

How to Avoid Phishing

• Never open unsolicited emails.
• If you do out of curiosity, don’t click on any links or download files.
• Use an email address lookup tool if you have a suspicious-looking email in your inbox.

Identity Theft

Identity theft can happen both in the live and digital realm, but id fraud statistics prove it’s becoming a more common form of online fraud. Anyone who steals the personal details of another person and uses it for financial gain or any illegal activity is committing identity theft. This type of fraud is mostly perpetrated by phishing attempts or hacking your network or computer.

How to Avoid Identity Theft

• Never provide sensitive information such as your Social Security number, banking details, or login credentials via email or any other method.
• Install security software with a capable antivirus and firewall solution, and keep it updated at all times.
• Keep your operating system (OS) updated, use strong passwords for all your accounts, including your WiFi router.
• Use a VPN when on public WiFi or unsecured access points.

Wire Transfer and Advance Fee Scams

Scammers request a fake processing fee on things that don’t exist, like free items, lottery taxes, or gift vouchers. Other popular scams include credit card processing, counterfeit charities, government fees, or advanced payment for goods that were never ordered.

How to Avoid Wire Transfer and Advance Fee Scams

• Credit card companies, tech services, utility companies, banks, and the government will never contact you by email or phone and request money for processing fees.
• If someone contacts you, claiming to be for the government or bank, report the email as SPAM and delete it. If you get a call, hang up and report the incident to the FTC.

Pagejacking

Hackers hijack part of a real eCommerce website to reroute traffic and direct visitors to a website they control. The fake site contains malware and other potentially unwanted applications that threat actors can use to bypass your network security.

How to Avoid Pagejacking

• Always check the webpage URL if you are suddenly redirected. If it doesn’t match the eCommerce website’s URL, doesn’t use encryption (HTTPS), or has an invalid security certificate, leave immediately.
• Some browser security extensions can detect phishing and pagejacking websites and warn you before connecting.
• Security software can also prevent rogue websites from opening.

Conclusion

Scammers are getting better at using technology in the digital world to steal money or personal information by creating fake websites and impersonating government or banking representatives. They use email, SMS, spoof domains, instant messaging, phone calls, malware, traffic rerouting, and other ways to interact with their targets. Working hard to avoid these scams should be your top priority every time you’re online.

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