Being safe online: how not to fall foul of fraudsters
Published 29 September 2011 by Daniel Culpan
What are the most effective ways of protecting yourself when using your credit/debit card online?
These days, as increasing numbers of us choose to shop online, we're potentially just a click away from sharing personal and sensitive information with others who may want to take advantage of them!
Whether we're buying concert tickets or DVDs, bidding for items in online auctions, or using internet banking, many of us choose to give away confidential information about our finances and personal identity to online businesses without much thought.
But are we really as safe when shopping online as we think? Some recent news stories suggest otherwise. Earlier this year, two London university students were jailed for 10 months after buying stolen credit card details online - which they then used to carry out fraudulent transactions. One of the offenders even used some of the money for the loan of a BMW 3-series!
Furthermore, the UK Cards Association revealed that, in 2010, 36.6 million adults - 72% of the UK's adult population - bought goods and services online, while total fraud losses on UK-issued credit and debit cards in the same year totalled a huge £365 million.
In light of the possible risks of sharing your personal details online, here's our guide to avoiding potential pitfalls - and making sure your finances are protected on the internet.
Credit/debit card fraud
According to the UK Payments Administration, the success of chip and pin technology saw losses on transactions on the high street fall from £218.8 million in 2004 to £72.1 million in 2009.
However, though shopping online is generally safe if you stick with trusted online stores, some websites don't always offer the same level of security you may find on the high street.
Just as some professional criminals choose to operate on the high street, the internet can also be used by people who may not have your best interests in mind. The potential for illegal activity online was revealed recently in the 'LulzSec' case: an online hacker group who managed to steal, and release, confidential documents held by major companies such as Sony and Nintendo - and even the CIA!
Of course, stories like this shouldn't scare us off, but simply highlight the importance of being ultra-aware of what details we provide - and how we provide them - when using the internet.
Yet there are some practical steps you can follow to protect yourself when sharing your financial details over the internet.
- Make sure you have up-to-date anti-virus and spyware-removal software on your computer. Even if you're using legitimate websites such as Amazon or eBay, you could still be at risk if you have a virus or 'malware' lurking on your computer and waiting to copy your card details.
- Avoid giving out your card details on shared computers, such as those in libraries or internet cafes - you never know how secure (or not) they might be.
- The only information required to make an online transaction is your card number, issue number, start and expiry dates and the 3-digit security code on the back of the card - and you should only ever give these out to online retailers you think are safe and trustworthy. You may also have to give the address the card is registered to for security reasons. Some websites, such as PayPal, require your sort code and account number, but if you're suspicious for any reason, go with your instinct and avoid it!
- Only enter your card information on a secure server. Don't worry if this sounds too technical - you don't have to be a Bill Gates-in-the-making to find out if the webpage you're on is secure. Most website addresses begin with 'http://' at the start - but secure addresses will begin with https://. As well as this, sometimes a padlock is shown next to the URL, just for extra reassurance. If you're asked to fill in your personal details on a page whose URL doesn't begin with https://, avoid it!
- Don't send confidential financial information or personal details by e-mail - and never open files attached to an e-mail from an unknown source.
- If you use a wireless network, make sure it is encrypted, and always be wary of what you get up to on Wi-Fi hot-spots, unless you know for sure that it's secure.
- Online banking is generally a safe and secure way of managing your money on the internet, but it's important to be aware of the possible risks on the web. Banking industry initiatives - such as Bank Safe Online - can help to keep you informed and updated on how to keep yourself and your money safe.
As the 'internet generation', much of the shopping we do these days is done in the virtual shopping aisles of the worldwide web.
Whether you're doing your weekly food shopping online, buying a new mobile phone, or getting concert tickets to see your favourite band, shopping online means you could be a click away from getting what you want, whenever you want it. Or not…
Online ticket buyers were warned earlier this year about an internet 'scam' in which criminals used fake websites to lure music fans into paying for concert tickets - which they then never received.
Here are a few security tips you could follow to help stop you falling foul of online 'fraudsters':
- Stick to known brands. One of the best ways of shopping safely online is to only buy from reputable websites. Whether they're manufacturer websites such as Sony or Apple, shop websites such as Sainbury's or Debenhams, or other well-known internet retail outlets such as Amazon, buying from known websites should guarantee that you're getting quality products and a good level of buyer protection too.
- If you're thinking of buying from a poorly designed or badly written website, think about whether you can buy the same product from a known, reputable retailer instead. Think of looking at websites as you would a shop: you probably wouldn't be happy handing your credit card over to someone who looked untrustworthy and worked in a shabby shop with a kind of 'unsavoury' feeling to it - so exercise the same caution online. Many fraudulent websites originate from non-English-speaking countries, so bad spelling and grammar should sound 'warning bells' to steer well clear!
- Use a secure online payment option such as PayPal, which should help to protect your financial details. If you use PayPal to pay for an item online and you have a problem with the purchase, PayPal will 'look to cover you for the full amount (including postage)'.
- You could register for programmes designed to make your online shopping much safer. There's Verified by Visa, for example, or the MasterCard® SecureCode™ programme, which lets you create a password - when you're at the online check-out stage, you just enter that password and it works like an 'electronic signature', providing further proof that you are who you say you are.
- Companies such as Western Union and MoneyGram are mainly designed for wiring money to friends and relatives. Legitimate businesses rarely use such methods of payment - the only way you should ever pay for items online is with a debit/credit card or another recognised, secure method of payment (e.g. PayPal).
- If you're buying anything from an online auction site, check the seller's profile and feedback information. This will allow you to see how recent customers have rated their transactions with the seller. Be wary about buying things from people with little or no selling history, and if you're not 100% sure they can be trusted, don't buy!
- Use an online directory such as Brand-i to help you find legitimate stockists of whatever genuine brands you're looking for - from designer clothes to the latest chart CDs.
It's not just your finances that could be damaged by internet fraud. Spare a thought for the 56-year-old Finnish nurse who had her heart broken - and her bank balance drained to the tune of £17,500 - by a conman from an internet dating website.
The moral of the story? Never trust anyone online whose identity you're unsure about, and never hand your money over to people you don't know and trust.
Shopping online isn't 100% foolproof - any more than the high street is - but if you follow these tips and always stay on your guard, the worst thing you should end up with is a bigger shopping bill than you'd perhaps planned for! (Be warned: online shopping can be really addictive!)