E-commerce scams now account for a majority of consumer fraud reports handled by the Better Business Bureau. Social media influencers play a significant role in selling merchandise online, making shoppers more vulnerable to increasingly sophisticated scams.

According to

Fake Deals, Real Trouble: Cyber Risks in Online Marketplaces
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by Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research, online stores must take steps to protect themselves and their customers from such scams. “Fifteen years ago, when e-commerce was becoming more mainstream and domain squatting was prevalent, there were concerns about brand integrity,” Goldberg noted. “Now, with the more extensive use of these online marketplaces, it’s coming full circle.”

The New Dark Web

With social media outpacing email as the primary tool for cybercriminals to socially engineer consumers and initiate scams, 50% of U.S. scam victims in 2024 reported being targeted through connections or unknown personas on social platforms. “Social media has quickly become the new dark web,” Goldberg stated, emphasizing that hackers are manipulating consumers directly via social media rather than resorting to selling credentials on the dark web.

Hackers can mimic well-known brands by advertising products with typo domains, often based on what influencers are promoting online. This results in consumers clicking malicious ads where they willingly provide credit card information and personally identifiable information (PII).

The Scourge of Typo Domains

Larger merchants like Amazon and eBay have become prime targets for these scams, initiated through platforms like Facebook Marketplace. Goldberg explained that users often click on ads that redirect to typo domains. For example, a consumer might think they’re buying from Louis Vuitton but end up on a spoofed site.

These attacks are becoming increasingly sophisticated, leading consumers to have a false sense of trust. Goldberg noted that many social media sites lack adequate protection, with measures like Meta Verified often being insufficient to prevent malicious users from selling goods on their platforms.

Taking Protective Steps

Banks like Chase are taking action against social media scams by blocking peer-to-peer payments through the Zelle network. This measure was implemented after noticing that nearly half of fraud reports stemmed from interactions initiated on social media. While maintaining customer satisfaction is challenging, other financial institutions are likely to follow this example.

Goldberg believes these steps are wise and predicts that more banks will take similar actions by the end of the summer.