e-comm

Covid-scams have cost consumers $500+ million, with online shopping seeing the most complaints

The Federal Trade Commission has received 545,000 complaints since January 1, 2020.
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E-commerce has its benefits—shopping in your pajamas, for one. But many consumers saw its dark side last year.

Scammers have swindled consumers out of $545 million in Covid–related scams since the start of the pandemic, per the Federal Trade Commission. The agency received 500,000+ complaints from Jan. 1, 2020 through Aug. 30, 2021; the most (55,000) came from online shopping, and totaled $45 million in losses.

  • People were duped by sites peddling pandemic staples like hand sanitizer.

A perfect storm: Covid and its uncertainty created ideal conditions for scammers, Jay Kennedy, assistant professor at Michigan State University’s School of Criminal Justice, told Retail Brew: “It’s really just been a repackaging to fit the pandemic, but it is ongoing. It started all the way from fake testing kits from the very, very early stages in early March.”

  • “As consumers, we are not accustomed to...being able to vet online vendors,” he added.

Friend or faux: Kennedy told us tools like TikTok Shopping—where “you have individuals as opposed to corporations who are controlling the marketing narratives”—can help legitimize the shopping experience for some.

“Any time retailers are willing to make those connections and create stores on those sites that give customers easy access to their products, that is a very good thing,” he said. “The challenge is, how much does this—like many other forms of e-commerce—open up opportunities for third-party sellers? And then importantly, can consumers distinguish between the legitimate and the illegitimate?”—KM

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