The five scams of Christmas

Falling for a scam or trap at Christmas time can dampen your festive cheer. We help you navigate the silly season safely
 
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01 .Silly season scams

The five scams of Christmas

Christmas is a once-a-year opportunity for the unscrupulous to scam consumers caught up in the festive spending spree. Last year, scams cost Australians $93m, plenty of which targeted holiday shoppers. We take a look at some of the worst offenders.

Two common scams involve e-greeting cards and parcels – things that may not seem suspicious when you’re in a festive mood.

e-greeting cards scam

  • You receive an email that claims a family member or friend sent you a card. However, if you follow the link, malicious software is downloaded and installed on your computer.
  • Tip If you’re not sure about an e-greeting supposedly from someone you know, ask them if they sent it before opening it.

Parcel scam

  • You receive a call or a notice is left at your door about an unsuccessful delivery. The caller may claim to be from Australia Post, even though Australia Post never makes such calls. Then you’re asked for a payment or for personal details, such as your bank account or credit card.
  • Tip: Call the delivery company directly using their official number to check if the situation is legit.

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(**Reported to WA Scamnet Christmas 2012)

 
 

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Sadly, some scammers try to profiteer from the spirit of the season. They may:

  • claim to collect for a charity that helps disaster victims or sick children
  • approach you while you’re shopping
  • send you an email, and/or
  • invite you to visit their fake website.

Tip Don’t donate to someone who approaches you out of the blue. Instead, consider which causes are important to you and donate to the charities directly. 

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Another potential trap is charity gift cards. Three years ago, our investigation found the charity may only receive 10% of what you paid. 

Tip
Legitimate charity catalogues allow you to buy gifts for someone in need and send a card to a friend or family member in whose name you have bought the gift. World Vision, for instance, offers school pencils for $5. You can also choose to buy chickens or sewing machines for those in need.  

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Complaints about gift cards that expire too soon land regularly in our inbox here at CHOICE, as do complaints about cards that impose unreasonable restrictions.ONLINE_ChristmasRipOffs_Filler_GiftCard

CHOICE spearheaded a major investigation into gift cards in 2010 that sparked a government inquiry. Unfortunately, the government decided to let the industry regulate itself. 

But there are still some steps you can take to avoid gift cards that end up leaving the recipient empty-handed. The first one is to read the fine print on the card. 

Look for cards:
  • with no expiry date, such as  those from Bunnings, Toys R Us, Ikea (Perth and Adelaide stores) and EB Games
  • that can be used at a number of everyday stores, such as Coles group & Myer or Wish (Woolworths group)
  • that can be tracked if they get lost.
Avoid those with:
  • a short expiry date (less than one year)
  • conditions and restrictions (such as “can’t be used on weekends”)
  • fees. The Australia Post Visa gift card, for example, charges a $5.95 activation fee, and $3.99 to call customer service.  
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Hamper companies promise to deliver everything you need for your Christmas feast to your door, claiming they’ll help you budget by allowing you to prepay in convenient instalments over the year. They also offer groceries in bulk, and gifts such as electronics or gift cards.Beware hamper rip-offs But here are the rubs.
  • Goods are often overpriced. For example, Chrisco’s Traditional Christmas and Bonus Hamper is over 20% more expensive than the cost of the same goods purchased online from Coles and Woolworths (including delivery). 
  • The usefulness and festiveness of some of the items is questionable. Chrisco’s Traditional Hamper includes tinned spaghetti and two-minute noodles. 
  • Hamper companies also sell a range of other goods, including electronics, but check for inflated prices. We found gift cards sold at a 10% mark-up.

Trap Beware of the cancellation policies for Chrisco, Hamperking and Castle Hampers. You’ll be charged between 18-50% of what you’ve already paid if you cancel after the 21-day cooling off period, or the full amount if you cancel after the final payment in mid-October.

Tip To budget for next year’s Christmas, consider setting up a savings plan. Check out the best online savings accounts.

ONLINE_ChristmasRipOffs_Filler_Shopping You can snap up some great bargains and stock up on Christmas decorations for next year during the end-of-year sales. Use our checklist below to make the most out of them.

  • Plan Make a list and divide it into "needs" and "wants". Check flyers and websites for the best offers before heading out to the sales, and be sure the offers are honoured at the store. 
  • Shop around Just because something is on sale doesn't necessarily make it the best deal. Many shops are willing to price match.
  • Haggle You’ll have better leverage if you can pay cash.
  • Buy online and avoid the crowds, but check the reputations of online sellers and be very careful if they’re based overseas.
  • Don’t overspend, and if you’re prone to getting into credit card debt, make sure you use a low-rate credit card.

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