Valentine’s Day is Christmas for fraudsters, but they don’t take days off

Valentine's Day is Christmas for fraudsters

Making our loved ones feel special is an important gesture, particularly on Valentine’s Day. A fancy dinner or a day at the spa are wonderful ideas, and of course, more roses are purchased on February 14th than any other day. But be careful — Valentine’s day can be considered Christmas for fraudsters. According to the Better Business Bureau, victims in the US and Canada have reported losing nearly $1 billion on romance scams over the last three years. Business is not spared either, with 63% of businesses facing the same or more fraud losses in 2018 than in 2017. This week may be peak season for consumer fraud, but small business owners are vulnerable in their personal and professional lives.


Personal Fraud

Thinking about sending flowers to your loved one? With many online flower shops promising to sell the freshest flowers with the best price and the fastest delivery, it can be confusing to settle on the right company to please your special someone. Many e-commerce sites will send you an email with a personalized offer claiming to be for a limited time only. Maybe they’ll throw in a bottle of wine too.

Okay, so you’ve made the purchase, written a customized note and paid for priority delivery hoping that they’ll receive it on February 14th. You get an email confirmation that your flowers were delivered. Perfect! But you don’t hear from your partner. Did they like it? Did the bouquet have their favourite flowers?

A few hours go by and you hear nothing, so you decide to call the flower company. You are told that there was an error with your package and they had to use a different, more expensive carrier. To fulfill the delivery, an additional fee is required using a payment method of your choice. You provide payment right away since the clock is ticking.

In the end, no flowers are delivered. You’re out the money and, most importantly, your Valentine’s Day is ruined. This was all due to a phishing scam that started with a spoofed email and a fake website. Fraudsters create emails and websites that appear legitimate but are intended to deceive and steal personal information to use for illicit purposes.


Small Business Fraud

Now, while the news often focuses on the latest romance scam or online dating scheme, we don’t often hear about how small businesses suffer from fraud every day.

Small businesses typically have fewer anti-fraud controls in place than large organizations, making them particularly vulnerable to attack. With few internal protocols and little protection externally (like consumers have with their credit card providers), 60% of small business fraud victims don’t recover any of their losses.

Believe it or not, the median fraud loss of small businesses is the same as companies with 10,000 or more employees. Unlike personal fraud, fraudsters don’t wait for special occasions or holidays to attack small businesses. They have become technologically savvy and continually look for vulnerabilities.

Check tampering, billing schemes and seemingly legitimate e-commerce sites make it extremely important for businesses to review their finances, whether it be through an internal audit or by reconciling accounts with a fine-tooth comb. Of course, there are now many affordable ways to help small business owners manage their payments and accounting so that no detail is left unnoticed. Regardless of whether you’re concerned about being scammed personally or professionally, here are a few general, but important tips to remember:


  1. Do Your Research: A simple Google search can reveal a lot about a company. Where is the company located? Do they have reviews on just one site or multiple sites? Often times, companies can purchase fake “reviews” in order for their business to appear legitimate. The Better Business Bureau is a great, reliable source of information on a company.
  2. Read the Terms and Conditions: This may seem time-intensive, but “the devil is in the details”. Do the terms raise any red flags? What recourse do you have if the product or service is not delivered?
  3. Carefully Review your Bank Statements: Whether you are reviewing your business account or your personal account, double-check every payment on the statement and flag anything that seems suspicious.
  4. Use Common Sense: Do things seem “too good to be true?” If you’re second-guessing yourself, your instincts are probably right.
  5. Report the Fraud: If you’ve been a victim of fraud, chances are others are being targeted as well. Always report suspected fraud to your local police department and the national anti-fraud governing body.

Co-authored by Nadir Samji, Director, Fraud Strategy and Operations

nanopay Corporation

Leave a Reply

Your email address will not be published. Required fields are marked *