Consumer Alert: Surge in Fake Website Scams Costing UK Shoppers Millions

Consumer Alert: Surge in Fake Website Scams Costing UK Shoppers Millions

(IN BRIEF) A recent report reveals a significant increase in online fraud involving fake websites, leading to an estimated £6.6 million in losses for UK shoppers. Scammers create counterfeit sites that mimic popular brands, luring consumers with fake discounts. Many victims are left with no merchandise or items vastly different from what they ordered. The financial sector is responding by enhancing measures to identify and block these fraudulent sites. Consumers are advised to verify website legitimacy before purchasing, report suspicious transactions to their banks, and use chargeback or Section 75 claims to recover lost funds.

(PRESS RELEASE) LONDON, 7-Sep-2024 — /EuropaWire/ — A concerning new trend in online fraud has emerged, with scammers exploiting fake websites to deceive UK consumers, resulting in an estimated £6.6 million in losses. This alarming figure highlights a dramatic 211% increase in card payment disputes over the past year, as reported by financial institutions.

The fraudulent scheme involves rogue operators creating counterfeit websites that closely mimic well-known retail brands. These deceptive sites, often promoted through social media, lure shoppers with promises of substantial discounts on popular products. However, once payments are made, victims either receive no merchandise or receive items vastly different from their purchases.

Recent reports reveal that many consumers have fallen prey to these scams, with each victim losing an average of £55. For instance, one case involved a shopper who ordered a luxury item, only to receive a child’s toy instead.

A number of fake retailers have been identified, including SM Wallet, Fines Jewellery, and Honest Concept Trading Hong Kong. Unfortunately, many victims are not recovering their funds due to a lack of awareness about dispute processes. It’s crucial for consumers to know their rights and the steps they can take to recover lost money.

To combat this growing threat, industry leaders are calling for enhanced measures from payment platforms and financial institutions. An industry working group, involving Chargebacks911 and other key stakeholders, is working to identify and block these fraudulent sites. The group also advocates for stricter controls to prevent scammers from processing payments through legitimate channels.

Gavin Evans, Senior Manager for Consumer Cards, emphasizes the importance of vigilance: “The rise in these scams is troubling, and it underscores the need for heightened consumer awareness. If a deal looks too good to be true, it probably is. Always verify the website’s legitimacy before making a purchase, and be cautious of deals advertised through social media.”

For those who suspect they have been scammed, Evans offers the following advice:

1. Contact the Retailer: Attempt to resolve the issue directly with the retailer first.
2. Report to Your Bank: If the retailer is unresponsive or uncooperative, report the transaction to your bank through their online or mobile services.
3. Request a Chargeback: Use your bank’s chargeback service for credit and debit card transactions to potentially recover your money.
4. Explore Section 75 Claims: For credit card transactions over £100, a Section 75 claim may offer additional recovery options.

Consumers are urged to stay informed and exercise caution when shopping online to protect themselves from fraudulent schemes.

For more information on recognizing and avoiding online scams, visit [consumer protection website] or contact your bank’s fraud department.

Notes to editors

1 Volume of disputes identified by Lloyds Banking Group across its debit and credit card customers.

2 Figure based on the amounts lost to the scam by Lloyds Banking Group customers, which has been extrapolated to estimate the total cost to consumers across the market.

Methodology:

Figures based on analysis of the amounts lost to this type of scam by Lloyds Banking Group customers between December 2023 and July 2024.

Media Contacts:

Sam Boden
Samuel.boden@lloydsbanking.com
07868 675 107

Lynsey Cheshire Willis
lynsey.cheshire-willis@lloydsbanking.com
07595 124 294

SOURCE: Lloyds Bank