Watch Out for Holiday Season Scams
The holidays are a season of joy and wonder. Unfortunately they’re also a season of scams.
The holidays are a little chaotic, after all, so it's easy to see why scammers would be so busy in the lead up to Christmas. As with all scams, prevention starts by slowing down and staying alert. It also helps to know what to look for.
With that in mind, here are some holiday season scams and how to avoid them.
Fake seasonal work scam
Some scammers may try to take advantage of your desire to earn extra money during the holiday season by sending out emails advertising phony temporary employment opportunities. Alternatively, they may post listings for fake jobs on social media or job sites.
This employment opportunity may be very attractive (usually with surprisingly good pay), so you click a link to begin the application process.
Two things may then happen:
- The link infects your computer with a virus or malware, which opens you up to potential identity theft.
- You're asked to pay a fee to submit an application. Similarly, you may be told that a credit report pull is necessary, which you're told to pay out of pocket.
Unfortunately, an employer is very unlikely to send you a job offer completely unsolicited, so be very wary of any employment offers that just show up out of the blue, especially one that seems too good to be true. As a rule of thumb, don’t click on any links in an unsolicited email unless you know and trust the sender.
Gift exchange scam
Secret Santa can be a fun, largely harmless way to disappoint a coworker during the holiday season. A similar, very much harmful version of Secret Santa uses social media to scam people out of money.
The scam begins with a social media post for a gift exchange. Spend $10 on a gift for a stranger and you could receive as many as 36 gifts back. You’re presented with a list of names – your gift goes to the name at the top. Then your name goes to the bottom of the list. When your name gets to the top, that’s when you start receiving gifts.
Except there’s a good chance your name will never make it to the top of the list, and besides, it’s actually illegal, as it’s considered a form of gambling.
So while this might sound fun and pretty harmless, there’s very little chance that participating in one of these pyramid scheme “gift exchanges” will pay off for you.
Gift card scams
The holiday season is when gift cards really shine. No idea what your 13 year old nephew is into these days? Get him a $25 PlayStation gift card and call it a day.
Unfortunately, gift cards are used to scam people all the time. According to the FTC, 40,000 consumers lost $148 million to gift card scams in the first nine months of 2021 alone. The issue isn't the gift cards themselves (don't get mad at Roblox and Applebee's...I mean, not for this anyway). It's that scammers are asking consumers to make payments with gift cards. They may be pretending to sell something. They may be impersonating a government employee. The common thread is always telling you to buy gift cards and then asking you to read them the numbers on the back of the card.
Why do they ask for gift cards? Because gift cards are like cash – you can’t reverse the transaction. The money is just gone.
Generally speaking, the safest method to make payments online is via credit card. Anyone asking for (or demanding) payment by gift card is a massive red flag.
Fake shipping scams
Your Amazon order has shipped. Your Etsy order is on the way. Your eBay order is on your neighbor's porch.
Your phone is probably blowing up with shipping notifications throughout the holiday season. So it wouldn't seem odd to receive an email or text message saying that you missed a delivery or asking you to provide additional information to complete a delivery.
Scammers are banking on you being less vigilant during the holiday season. Because that delivery isn't real and the link you clicked is trying to install malware, trick you into sharing personally identifying information, or both.
Read texts and emails carefully. Look at the sender. If for any reason they don't look legitimate, don't click that link. Contact the seller or the delivery company directly to verify that the request is real.
Charity scams
In a season of giving, you're likely to be asked to contribute to charitable causes. And there are so many legitimate charities out there that want and need your support, so giving is a great thing to do.
But as we've already established, scammers are running amok during the holidays, and they won't hesitate to use your good nature against you. Whether they're imitating a real charity or promoting a fake one, charity scams are rampant.
To make sure that your money is going to an actual good cause, always research the charity before making a payment. Make sure that it's real and that you understand the work it does. Don't make donations by gift card, cryptocurrency, or wire transfer. Don't let yourself be pressured into making a donation quickly.
Giving is great, but getting scammed can put a real damper on the holiday cheer, so be cautious and don't let the spirit of the season lower your guard.
Worried that your holiday spending is out of control? MMI offers free financial counseling 24/7, online and over the phone. We can help you address bad spending habits, improve your budget, and start getting out of credit card debt.
