Online shopping scams: How to spot and avoid them

Estimated reading time
 6 min

Jump to

• What is an online shopping scam?
• How can you spot an online sales scam?
• Ways to avoid being scammed when buying or selling online
• What can you do if you think you’ve been scammed?
• Who can you contact if you’ve been scammed?

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Scoring a bargain from your couch or selling old furniture online feels great - but it’s not just savvy shoppers who benefit from online marketplaces.

Scammers are also cashing in, using deceptive tactics to trick Australians out of millions.

According to Scamwatch, Australians lost over $26 million to buying and selling scams in 2024. As our lives become more digital, scammers are finding new ways to exploit trust and steal money. 

Read on to learn how online shopping scams work, how to spot the red flags, and how to help you protect yourself when buying or selling online.

What is an online shopping scam?

An online shopping scam is any scam that takes place in the online sales space. They’ll usually present in one of three ways:  

Fake online stores

Scammers create websites that mimic legitimate retailers, offering deals that seem too good to be true. Once you make a purchase, the product never arrives and the seller disappears.

An online marketplace seller

Scammers pose as sellers on platforms like Facebook Marketplace, Gumtree or eBay, offering high-demand items such as electronics, cars, or event tickets. They may even provide fake receipts to appear legitimate. Once payment is made, you may not hear from the seller ever again.

An online marketplace buyer

Scammers also pose as buyers. They claim to have paid you and may send fake emails from PayID or PayPal, asking you to upgrade your account or refund an overpayment.

How can you spot an online shopping scam?

Watch for these common red flags:

• The deal seems too good to be true.
  
  
• The account name doesn’t match the seller’s details.
  
  
• You receive an invoice for something you never ordered.
  
  
• A buyer insists you upgrade to a “business account” to receive payment. 
  
  
• A seller refuses to provide more images or details about an item. 
  
  
• A buyer offers to pay immediately - without seeing the item
  
  
• The seller creates urgency or pressure to act fast.
  
  
• The retail website lacks credentials - such as an ABN, privacy policy, or contact information. 
  

8 ways to avoid being scammed when buying or selling online

1. If a price seems too good to be true, or a buyer is offering you full payment on an expensive item without even viewing it, stop, and consider further investigation before you proceed with the transaction.
   
   
2. Do not release any goods to the buyer until the payment has hit your account.
   
   
3. Be your own investigator and ensure you’re on the right website for any online store. Don’t simply click the first page that appears from a web search.
   
   
4. Never agree to refund someone who claims they overpaid for an item unless you have seen the money enter your account. Do not trust receipts they may send you, as they can be easily forged. 
   
   
5. Check for an ABN listed on any online store and look it up on the Australian Business Register website.
   
   
6. Always look a bit deeper at a brand or store you haven’t heard of before, especially if they’re offering items for a significantly lower price than their competitors.
   
   
7. If a website seems dodgy, use the ICANN website to find out when it was registered. A recent registration could indicate that it’s a scam.
   
   
8. Make use of PayID (a service that operates through your bank) when performing transactions on online marketplaces so you can match up the buyer or seller’s details.

Note: PayIDs are managed by your bank, and PayID would never contact you directly. If you have concerns, please contact your bank.

What can you do if you think you’ve been scammed?

If you think you’ve been scammed while shopping online, remember, this can happen to anyone. While it’s deeply frustrating, there are some immediate actions you can take to protect yourself from further financial harm. 

• If you have shared financial information or believe you have transferred money to a scammer, notify your bank immediately.   If you’re an ANZ customer, please contact us immediately.
  
  
• If you shared credit card details, block or cancel those cards immediately. If your cards are with ANZ, you can do this through the app. Learn more.

If you bought from a fake website from a well-known brand, you could inform them that someone is posing as their business.

Who can you contact if you’ve been scammed?

• Report the scam to the Police through the Australian Signals Directorate’s ReportCyber portal. This resource is there for reports of scams where money or personal information has been lost.
  
  
• Help others by reporting to Scamwatch to help them prevent future losses, monitor trends and educate the population about emerging threats. 
  
  
• You can also contact IDCare, a not-for-profit organisation providing support to those experiencing identity and cyber security issues.