The final few days of the Christmas season are the busiest and most profitable for online merchants. But they are also a time when cyber crooks are most active. Experts on combating online fraud offer some timely advice on how you can avoid becoming a victim - whether you're a merchant or a consumer.
These last few days of the Christmas season are deemed by many merchants as the most profitable online shopping days of the year.
Unfortunately, cyber criminals are also most active during this period, and the incidence of hacking, ID theft, and credit/debit card fraud is also unusually high.
The good news for online shoppers is should they become victims of cyber crooks, they generally aren't deemed liable - the merchants are.
“Unless intent or complicity can be proven, consumers are not held liable for credit or debit card fraud,” said Jas Anand, Toronto-based product and risk strategy manager at Actimize Inc., a fraud and financial crime prevention services firm headquartered in New York.
Anand said, online shoppers whose card information has been compromised and used for unauthorized purchases, can still recoup the money (if they used a debit card) or have the illicit purchases reversed, if they used a credit card. “The onus is on the online merchant to prove they followed all the rules in carrying out the transaction.”
Despite the dangers of online shopping, buying items over the Internet is steadily growing.
Some 2.2 million Canadians placed about 13 million orders online in 2001, according to Statistics Canada. The number of orders shot up to 70 million by 2007 as some 8.4 million individuals logged on to make purchases. The total value of online orders for that year was estimated at $12.8 billion compared to $412 billion in total retail sales.
But these numbers are still way below those in the U.S., according to Mark Beazley, director of communication for the Retail Council of Canada. “Canadian online sales represent about two per cent of overall retail sales on a annual basis. That pales in comparison to the U.S., where it's around six per cent.”
This does not however, diminish Canadians' value as fraud targets.
For example, the Canadian Anti-Fraud Centre, known as PhoneBusters recorded more than 200,000 complaints so far this year. Internet scams shot up from the fourth most complained about scam in 2007 to number one in 2008 and 2009, according to the Better Business Bureau.