For many years, I was an “early adopter.” I was the guy who got the new gadget when it first came out. I reckon it’s because I’m intrigued by newness, and curious to see how things work. Or don’t work … my first cellphone, a Nokia the size of a brick, was about as robust as one of those arts-and-crafts structures made out of glue and Popsicle sticks. It spent more time being repaired than in my hands.
My enthusiasm for new technological opportunities extended to online commerce as well. As hard as it may be to imagine, more than a decade ago I was ordering things from Amazon.com and having them delivered to my home in Africa. At least, I did; eventually, Amazon stopped doing business with the country because of all the packages stolen by workers at the South African Post Office.
A cautionary tale … one which brings me to the looming subject of Cyber Monday … and how you can protect yourself from the dangers lurking online.
Shop Smart on Cyber Monday
Last Cyber Monday — December 2, 2014 — was the biggest online shopping day in U.S. history. The average purchase was $128; overall, $2.4 billion changed hands that day, up 23% from the previous year. Total online sales for the 2014 holiday season were almost $90 billion, accounting for just less than half of all holiday-merchandise spending — and almost 10% of the U.S. retail industry’s annual sales.
That’s a lot of digital moolah to be throwing around the Internet. Predictably, some of it was lost to fraud. But people are getting wiser. As you may recall, in 2013, Target suffered one of the largest consumer data breaches in history … including my own debit-card details. That reportedly had a significant impact on Target’s 2014 sales — as it should.
So what can you do to shop safely online this holiday season? I’ve compiled my favorite tricks just for you.
Basic Online Hygiene
- Don’t use a debit card for online shopping. Credit cards are contractually protected from fraud, whereas debit cards aren’t. Compromised debit-card information could give phishers or hackers access to your entire checking account and unlike credit cards, the bank won’t cover any losses.
- Avoid giving card information over the telephone. It sounds paradoxical, but the rules governing protection from fraud are stricter for online activity than for remote purchases made verbally.
- Make sure all of your computer security software is up-to-date. That includes anti-virus software, anti-spyware software, firewalls and browser extensions like Privacy Badger, Disconnect and Privacy Fix. These not only weed out bogus websites — they also prevent your online activity from being tracked by data harvesters.
- Create a special email account for your online shopping, preferably with a secure email provider that offers end-to-end encryption, like ProtonMail. That way you can keep your personal address out of the hands of scammers and advertisers.
- Never enter personal information into a pop-up screen on the web. Unauthorized pop-up screens can be created by identity thieves. Legitimate companies don’t ask you to enter personal or financial information on pop-up screens.
- Don’t shop with your mobile device or laptop computer when you’re connected to a free public Wi-Fi network unless you’re using a secure virtual private network (VPN).
Email and Other Scams
Online scammers take advantage of the holiday season to send out “phishing” emails. So…
- Ignore emails from unknown merchants pitching “too good to be true” deals on brand-name products. Scammers often use email to advertise hot-ticket items that may become hard to find during the holidays to lure unsuspecting consumers to click on links.
- Watch out for offers for “gift cards.” Something like a free $500 gift card for a small purchase is almost certainly a scam designed to harvest your financial data.
- Beware shipping notices. Most legitimate online retailers will update shipping and delivery information by email. An email with a link to a UPS or FedEx website is fine. But if you get an email that asks for credentials to check on a package — especially if it is for something you didn’t order, purporting to be a “gift” — don’t click. You’re always better off going to the shipping site yourself and typing in the tracking number.
- Similarly, never respond to emails asking you to “confirm” recent transactions after you shop.
- Many charitable organizations make a pitch for end-of-year giving, especially since it’s often tax-deductible. Scammers know this and send out emails from fictitious groups, so do your homework. Check the group’s website as well as sites such as Charity Navigator, Charity Watch and the BBB Wide Giving Alliance to confirm the charity is genuine.
- I’m a big fan of electronic holiday cards — it shows “I care enough to hit send.” Sarcasm aside, make sure you choose a well-known site. Scammers sometimes set up malware-ridden sites that can infect not only your computer, but the computers of the friends and family to whom you send them.
Mind Your Money
- Try to use one credit card for all your online purchases, so you can easily see if there are potentially fraudulent charges. January and February are the months to comb through monthly statements to check for suspicious activity. Be especially alert for unusual small transactions, which thieves sometimes use to test the waters before a shopping spree.
- Set up email or text alerts for online transactions for your credit-card account. Virtually all credit-card issuers offer this service. You get an instant notification whenever something is bought without the card present, or when a purchase is made over a certain amount. These notifications have saved my cash on more than one occasion.
Tried and True
Chances are that you’re going to do most of your shopping at one of the big online retailers, with whom you already have an account. Although as a rule I prefer to give business to smaller outfits, when it comes to online shopping during the hectic holiday season, it’s probably best to stick with the devil you know.
Finally, my personal online shopping golden rule … don’t do it after that third scotch (or whatever your poison may be). Otherwise you may end up like this guy.
Offshore and Asset Protection Editor