Scams are on the rise, according to research by the competition watchdog, which found over $93 million was reported lost by Australians last year.
The Australian Competition and Consumer Commission’s Targeting Scams report launched today showed the ACCC received nearly 84,000 reports of scams from consumers and small businesses in 2012.
This was a 65% increase in reports of online shopping scams and a significant jump on the financial loss resulting from scams last year, which was $85 million.
ACCC deputy chair Delia Rickard said reports of financial losses to the ACCC are just the tip of the iceberg as victims of scams are often too embarrassed to report their experience.
Businesses can also lose significant revenue to scams activity, either directly as victims, indirectly through scammers impersonating them, or in costs associated with ongoing monitoring and security upgrades.
“Scammers continue to find sophisticated methods to deliver scams, taking advantage of new technologies and communication methods to try and slip under your radar,” Rickard said in a statement.
“Nowadays it can take just the click of a button to fall victim to a scam, so it is more important than ever that we practise safe techniques when communicating with others—whether online, on the phone, at one’s business or even at home.”
Here are five things to watch out for to make sure your business is not a scam victim:
1. Suspicious looking bills
False billing scams are the most commonly reported scam targeting small businesses.
The ACCC received 2546 reports of false billing last year where small businesses are targeted by tricking them into paying for unwanted or unauthorised listings or advertisements in magazines, journals, business registries or directories.
Services often used as a ploy to target businesses include domain name registration and the provision of office supplies. Common scam tactics are to send a business a subscription form disguised as an outstanding invoice to get the business to sign up for unwanted ongoing advertising services.
Scammers also falsely claim that the directory or publication is well known or has a high readership.
2. Beware of unsolicited phone calls
The phone is the scammer’s preferred method and made up 56% of all reports to the ACCC.
The most prominent scams delivered via telephone calls were advanced fee/upfront payment, computer hacking, unexpected prizes, sweepstakes and lottery, and phishing and identity theft scams.
3. Read your emails carefully
Last year there was also an increase in scams delivered of 6.5%, with online scams representing just over 35% of all scam approaches.
Online scams are designed to take advantage of the anonymous and instantaneous nature of the internet, with many victims only realising that they have been scammed when their credit card statement or other invoices arrive.
Scammers often pose online as legitimate sellers or buyers on auction and shopping sites, or try to ‘befriend’ victims on social networking forums, and they also masquerade online as well-known organisations.
Watch out for phishing email scams, where a scammer is ‘fishing’ for the recipient’s personal details by sending an email which appears to come from a trusted entity such as a bank or financial institution.
Scammers also use emails, fake or corrupted sites and false pop-up alerts to deliver malicious software that can infect computers and allow access to information stored on the hard drive.
4. Watch out for requests of upfront payment
Up-front payment scams were the most commonly reported scam type last year, making up 32% of all scam contacts.
The scam involves a scammer offering their victim a share in a sum of money or goods.
They are generally asked to provide up-front payments and/or personal information to receive their share, but the promise is never delivered.
5. Be alert to computer hackers
Scams where victims receive a phone call about a computer virus and are convinced to provide access to their computer cost Australians $1,312,794 last year, according to the ACCC.
Computer hacking was the second most reported scam type to the ACCC in 2012, contributing to just over 13% of all scam reports.
One scam involved the scammer pretending to be from Microsoft and phoning up claiming the victim’s computer has been infected with a virus, which needs to be fixed immediately for a fee.
The scammer then gets remote access to the victim’s computer and personal information stored by using a high pressure sales tactics to incite fear and anxiety that computer has been compromised and must be fixed immediately.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
