Fake shops: how to protect yourself against online fraud

Have you found a branded pullover in an online shop for CHF 19 rather than the standard CHF 99? This kind of "bargain" should set alarm bells ringing with you, as it's likely that you've landed on a fake shop: cyber expert Katrin Sprenger answers the most important questions about fake shops.

What is a fake shop?

Fake shops are fake online sales platforms. They normally pose as online retailers selling goods at particularly cheap prices, ask for payment in advance, and either do not send the goods or send ones of poor quality, such as fake rather than original brands.

It's hard to spot fake shops, as the operators are also getting better at designing websites that are very similar to the originals. But there are a few points you can check to determine whether it's a reputable trader or a fake shop.

How do I recognize fake online shops?

• Take a closer look at the address: is the domain name correct? Fraudsters like to work with small transposed letters in the domain which the customer automatically assumes are correct, such as https://galaxius.ch/ or https://amozon.de/.
• Are the prices unbelievably cheap? If a bargain offer sounds too good to be true, you should steer clear. It's highly likely to be a fake shop which means that you’re buying counterfeit goods.
  
• Is a legal notice listed? In Switzerland, online shops must display contact details as well as a legal notice. If there's no legal notice, then the website could be a fake shop and you shouldn't buy anything from it.
  
• Read the terms and conditions: check the small print. At the very least, you can find out about the returns policy, delivery times, etc. If you can't find any clear information here, then it's best not to buy anything from this shop.
  
• Does the online text appear in the correct language? Or are there lots of grammatical and spelling mistakes? That would be typical of a fake shop.
  

What are the risks when online shopping?

One of the most  common risks when shopping online  is the direct loss of money. This typically happens when you order something from a fake shop – normally a product of some kind – and pay for it up front before you receive it. Indirect losses arise if ordered goods do not meet expectations, e.g. incorrect or partial deliveries or defective goods.

When do I have to be particularly careful as a consumer?

A rule of thumb is that you should be wary if you see offers that look too good to be true. If a product is being offered on a website that is well below the average price, you should check certain details on the website before ordering.

You should also take a closer look at the product images. A reputable online shop operator takes care to show sharp and clear product images. You should be particularly careful if the product images in the shop look like they've been thrown together and are of varying quality - this is often a sign of a fake shop.

Last but not least, you should be wary if the online shop only accepts advance payments by transfer or credit card payment. Finally, it's also worth doing some research to find out the experience of other buyers to help you decide whether to buy anything from a fake shop.

I’ve found a great beauty shop on Instagram that turned out to be a fake shop. Don’t Instagram or Facebook check out the providers?

No, Instagram or Facebook don’t check out the providers. Both platforms simply provide an opportunity to have a social media presence. Posted content is only checked to determine whether it breaches the relevant platform’s rules on the portrayal of violence or explicit content, for example. There are no checks to identify fake shops - even if the purchase isn’t carried out on the platform itself, but externally with the online shop.

Can a Google search help to uncover fake shops?

It’s worth doing a quick Google search before ordering from a shop you’re not familiar with. If you enter "shop name" and "rating", you are normally taken directly to the reviews of other buyers. If these are essentially positive, you can normally order with confidence. If they're poor, you've probably landed on a fake shop and should steer clear of it, particularly if the offer seems tempting.

What’s the difference between http:// and https://?

The difference is whether information you've entered on an online form, for instance, is transmitted securely or not.

If there’s no "s", it means that if you pay by credit card, information you enter as a buyer will be transmitted on a one-to-one basis and therefore unencrypted. In this case, information can be accessed and stolen by hackers or fake shop operators.

If the shop has an https address, you can assume as a consumer that the information will be encrypted and therefore transmitted securely.

Can I shop 100% securely with known online shops?

There will never be 100% security, there is always a residual risk. For example, there’s a risk that you’ll receive the wrong products or only part of what you ordered. But in most cases these problems can be solved and are nothing compared to the hassle of being tricked by a fake shop and not being able to contact the operator if you have a complaint.

What is drop shipping?

Drop shipping is an online sales model where the item being sold is not physically in stock, but when ordered by the end customer, it can be ordered and sent out by the trader more or less on time.

The online shop is therefore a kind of distributor. One example of the drop shipping model is online furniture shops: it goes without saying that they cannot possibly have in stock all the beds, cupboards or tables that they offer.

Should I generally avoid buying from a new online shop?

A sweeping generalization like that isn’t helpful, and it wouldn’t be fair on all the new small online shops. For niche products especially, you’ll probably need to resort to online shops you’re not familiar with quite often. But this doesn't necessarily mean that it's a fake shop. As well as these points, you should never pay in advance! Choose payment on delivery or, if you don’t have a choice, use a payment service such as PayPal. You can then claim your money back from the payment service instead of the seller if there’s a problem with your order.

Are services like PayPal & more secure than entering your credit card number on a site protected by SSL encryption?

SSL encryption and services like PayPal are two very different things. The presence of SSL simply tells you that your data are being transferred via a secure connection. PayPal and similar services use it, but they also handle the actual payment. As a rule of thumb, we can say that a service like PayPal is more secure than paying directly with your credit card because it offers buyers a certain degree of buyer protection as part of the service.

An online shop has delivered something that doesn’t match my order. I’ve tried to contact the shop at the address provided, but I haven’t had a reply. What can I do?

Cases like this usually take up a lot of time and energy. If you’ve chosen the Online Shopping module as part of Cyber Plus insurance, we’ll take care of the hard work for you. Simply send us the necessary documentation via our platform, such as the order confirmation, invoice, etc., and we’ll contact the shop on your behalf to sort out the problem. If that doesn’t work, we can hand the matter over to AXA-ARAG at your request. If legal action doesn’t get the result you want either, perhaps because the online or fake shop no longer exists, AXA covers the financial loss you incurred.

Have you ever fallen victim to a fake shop?

Yes, that’s genuinely happened to me. A few years ago, I ordered some top-brand shoes for an amazingly cheap price, paid up front, and then never received the shoes. Nowadays, I’d spot straight away that something wasn’t right with that apparent bargain.