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Protect Yourself from Fraud this Holiday Season

Lily O'Halloran


The winter holiday season is a favorite time of year many small business owners. The holidays bring out shoppers of all kinds that often generate record-setting sales. Unfortunately, the holidays also bring out online scammers. Learn how to protect yourself from online scams, so that you can reap the benefits of a prosperous holiday season.


Protect Your Business

One of the most important things that you can do is to know how fraud protection policies work. For example, PayPal recently changed their policy to provide better protection for sellers. PayPal states that their updated seller protection program makes it easier than ever to be covered against unauthorized payments and items-not-received claims, chargebacks, and reversals. PayPal has also removed the annual coverage limit, added international sales coverage to 190 countries, and added protection for shipping to unconfirmed addresses. Take the time to read through any policies that protect you from fraud. Learn what types of payments and transactions are covered; use this knowledge to make sound business decisions.

Trust your instincts. When you get that feeling in the pit of your stomach that tells you something is not right, take heed. Those feelings are there for a reason. What should you do when this happens? Alleviate your fears of fraudulent activity by contacting the buyer via telephone or email. Confirm the details of the transaction, such as billing and payment information, shipping information, and the order summary. You may be dealing with a scam artist, if you are not able to get in touch with the buyer. Scam artists generally provide false phone numbers and out-of-country free email addresses.

Be wary of customers that ask you to use a specific escrow service or agent. If you choose to use escrow for big-ticket items, then you need to take the time to select a legitimate escrow service. You should already have this research completed before selling high-priced products. Better yet, you should already have an account in place, so that you are ready for these types of sales. Buyers that tell you to use a specific agent or service are usually scammers. List the escrow service that you use in your auction listing to deter scam artists.

A popular type of scam during the holiday season includes the buyer requesting that the order be shipped to a foreign country – an address that does not match the payment address. Under previous fraud prevention policies sellers were not covered, thus they ended up losing the costs associated with selling the product when the order turned out to be fraudulent. Fortunately, some new changes favor protection for sellers. If you are using PayPal as a medium through which payment is collected, then you may be covered against this particular type of fraud. Read applicable guidelines and follow each procedure carefully to ensure that you will be covered. State your policies in your auction – including acceptable forms of payment, shipping locations, and other information that a buyer needs to know, so there are no surprises at the end of auction. This will keep your customers in the know, while protecting you from fraud – a win-win situation.

Before you assume that a customer is a scammer, take a close look at their buyer information. How does their feedback look? A scam artist generally won’t have a substantial amount of positive feedback. Does the buyer’s contact information match the payment information? Scam artists generally use different contact information, because the payment information is not their own. Does the shipping information match the payment information? A different shipping address does not necessarily mean that the order is fraudulent; the order may be a gift. However, you should take a close look at orders that specify a different shipping address. You may want to call to verify the details of the order. If something about an order seems off; contact the buyer.

Your first layer of protection from fraud is yourself. Be knowledgeable about fraud protection and current scams that are circulating the Internet.



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