Fraud Help Desk reports surge in fake webshops during the pandemic

Careful domain name management can help

Close-up of delivery person carrying cardboard box while delivering it to a customer

Nike sneakers for sale on a website with an education-sector domain name? Facemasks available from an Asian snacks wholesaler? Sounds all wrong, doesn't it? Because it is. Both are recent examples of fake webshops with illogical domain names used by cybercriminals to defraud consumers. It's not unusual for scammers to choose domain names unrelated to the products they're offering, including names linked to companies in completely different sectors. And, since the pandemic hit, the trend has really gathered momentum.

Explosive growth in webshop fraud

In terms of victim numbers, webshop fraud is easily the biggest form of fraud, along with phishing and dating fraud, for example. Of the three thousand people who reported online scams to the Fraud Help Desk in 2021, half were victims of online shopping fraud. The number was nearly double the corresponding figure for 2020 and matched the entire number of frauds reported in 2019.

Bar chart showing the ratio between the number of reports and the number of victims of shopping fraud over the period 2018 - 2021.

Figure 1: Shopping fraud reports and victims recorded by the Fraud Help Desk (source: Fraud Help Desk).

Cashing in on demand for scarce goods

In recent times, online scammers have focused on products that the coronavirus pandemic has made hard to come by: facemasks, fitness equipment and the like. "Trending forms of internet shopping fraud mainly involve products that, due to the restrictions, can only be bought online," says the Fraud Help Desk's Tanya Wijngaarde. "The emphasis is on very desirable goods that are currently difficult to get hold of: the latest PlayStation, for instance. In the early days of the crisis, we also saw a lot of scams involving face masks and disinfection products. A bit later, it was home testing kits. With gyms and beauty salons closed for extended periods in recent months, we've also seen a lot of frauds involving sports equipment and cosmetics."

Cybercriminals seek the trust of online shoppers

It might seem strange that such goods are offered on sites with unrelated domain names, but there is a logic to it. By using established or recently cancelled domain names, the crooks benefit from prior search engine indexation, backlinks and traffic – in some cases even positive online reviews.

And those advantages outweigh the drawbacks of dissociation with the products on offer. Cybercriminals are therefore constantly on the lookout for established or recently cancelled domain names to use as cover, since endless switching is needed to keep ahead of people intent on taking down scam sites. Another reason for recycling old domain names is that unrelated domains are less likely to attract the attention of legitimate sellers in the same segment, who use monitoring tools such as SIDN BrandGuard to scan the internet for possible abuse.

Payment method is an important pointer

On its website, the Fraud Help Desk lists various ways of recognising a fake webshop. One of the best ways to protect yourself is to look at the payment methods supported by the shop. iDEAL, credit cards and payment on receipt aren't usually attractive to cybercriminals. And credit card companies are obliged to provide consumer protection. A site that will only accept advance payment in a cryptocurrency should immediately be viewed with suspicion.

What can legitimate businesses do?

How can an honest webshop avoid being mistaken for a scam site? And how do you make sure that your domain name isn't abused for a malicious purpose? We've got two vital tips:

  1. Protect your company information against abuse. Make sure that your business details, as recorded in the domain name register, are correct and can actually be used for contact. Many businesses let website designers and others register their domains. If a service provider's details appear in the register on sidn.nl instead of yours, consumers may be confused. For more information, see the Fraud Help Desk's guide.

  2. Look after your domain names. Make sure that your domain names and websites are properly protected. Is your CMS up-to-date, for example? And, when you no longer want a domain name, don't cancel it immediately. Retain the registration for a while, with a redirect to your primary site. Or park it until it stops attracting traffic. Want to know more? Read our article about cancelling a domain name.

Given that scammers prefer certain payment methods, you'll obviously want to opt for methods that consumers can trust. And look out for the secure online trading advice we regularly publish on sidn.nl. For all the latest news direct to your mailbox, subscribe to our newsletter.