WhatsApp scams and online fraud: how to spot a small business scam

As technology evolves, so do scammers. More and more people are falling victim to scammers – fraudsters who are trying to take advantage of you and get your money.

Being self-employed, your business is your livelihood so it’s important to make sure you’re taking all the necessary precautions and staying safe online.

From WhatsApp scams to fraudulent customers, keep reading to see some of the latest scams prevalent in the UK – and how you can spot them.

Online shopping scams

According to Lloyds Banking Group, two thirds of all online shopping scams now start on Facebook and Instagram. For business owners and customers alike, it’s important to stay alert when shopping online.

Lloyds estimate that there’s £27m lost by UK consumers falling victim to online shopping scams each year. Whether you’re buying or selling, here’s how you can stay safe when buying products online.

Safe online shopping as a seller

Selling online is a great option for many small businesses – giving you a wider market reach and more flexibility than a traditional brick and mortar store. One of the main ways sellers can fall victim to customer scams online is through fraudulent refund requests in the form of chargebacks.

Chargebacks are a type of payment dispute where a customer is refunded their money by their bank after flagging a transaction as fraudulent. Small businesses aren’t typically aware this is happening until the money leaves their account, as customers will request the chargeback through their own bank.

Fraudulent customers may claim their items arrived damaged – or never arrived at all. They may initially message your business to claim a refund before going to their bank, or bypass you entirely.

It’s important to research courier options for your small business. Choosing a service where the recipient has to sign for their item can help prevent customers claiming their order didn’t arrive.

Etsy scams

Selling on an established platform, such as Etsy, can offer peace of mind as they have a dedicated customer service team to help manage customer disputes. The Etsy Help Centre has information on common scams on the platform, as well as how to identify them. Some common customer scams on Etsy include:

• refusing to pay by Etsy
• asking for additional items and promosing to pay later
• claiming items are damaged or haven’t arrived
• offering you more money than your item is listed for (this often means their payment method is fraudulent or stolen)

Safe online shopping as a customer

If you’re buying stock for your small business, sometimes you’ll need to be the customer. To avoid falling victim to online shopping scams, make sure to do the following:

• do your research and read reviews: never heard of the brand? Price seems too good to be true? Read what previous customers have experienced
• check the site is secure: secure website URLs begin with https, with the s standing for ‘secure’, and feature a padlock symbol
• pay with a credit card or on PayPal: credit cards offer more security than debit cards, while PayPal hides your personal financials details and offers purchase protection
• watch out for copycat and fake websites: fraudsters sometimes create websites that look like big name brands and use social media and online ads to get people to part with their personal details
• beware of fake order confirmations and delivery notes: try to not respond to notifications straight away as many fraudsters impersonate couriers and retailers in subject lines and texts pretending to be an order you might have made

Black Friday scams

Whether or not you choose to take part in the global sales day as a small business, known as Black Friday, it’s important to be vigilent if you’re buying online.

It’s common for fraudsters impersonate big retailers during Black Friday with realistic websites and large discounts advertised on social media to draw you in.

Remember the advice from Action Fraud’s Take Five campaign:

• stop – take a moment to think before parting with your money
• challenge – could it be fake? It’s OK to reject, refuse, or ignore requests
• protect – contact your bank immediately if you’ve been a victim of a scam

WhatsApp scams: how to stay safe

One of the most popular ways for scammers to target victims is through WhatsApp, Facebook, and Instagram – all owned by US tech giant Meta. Keep reading to be aware of some of the most current scams on the apps.

Requesting money scams

Many of these scams start the same way, with the scammer posing as someone in need of money. You’ll receive a WhatsApp message from an unknown number, claiming a broken or lost phone and asking to be contacted on a new number.

Most victims of this scam report that the fraudster will ask for money – usually claiming to be for a new phone or to pay their bills. According to the National Fraud Intelligence Bureau and Action Fraud, there have been 414 reports of this scam in the UK between January and May 2023 alone.

Whilst these scammers usually pose as a child or family member, small business owners can also be caught out this way. Perhaps the scammer will claim to be a customer or a new supplier. Whether you get targeted in your professional or personal life, it’s important to be vigilant.

WhatsApp verification code scams

Scammers can also try to gain access to your WhatsApp account. They do this by registering your phone number to their device. WhatsApp will then send you a genuine verification code text – but the scammer will text you claiming they inputted your phone number by accident and need the verification code.

Once you send it to them, they can gain access to your account and use it for further scams. You can avoid this by ignoring any verification codes you didn’t request, and not sharing the codes with anyone.

WhatsApp phishing scams

Another way you can get scammed over WhatsApp is by falling victim to phishing. If you receive a text inviting you to fill out a survey or redeem a gift card, make sure it’s from a company you’re signed up with – and ask yourself if the offer is too good to be true. The purpose of these phishing scams is to gain personally identifiable information about you or to download malware onto your device.

What happens if you fall for a WhatsApp scam?

It’s important to think twice about engaging with unknown numbers – and especially sending money to unknown bank accounts. Many scammers choose WhatsApp as it’s an encrypted platform. Whilst this encryption can be beneficial when doing business on WhatsApp, it also means it’s harder to track down and prosecute scammers.

If you fall victim to a WhatsApp scam, you may not be able to get your money back. Some banks give warnings to customers about trusting WhatsApp messages when logging into online banking apps – so it’s important to pay attention.

What precautions do you take to avoid falling for scams online? Let us know in the comments below.

More small business guides for keeping safe online

• Small business cyber security – everything you need to know
• HMRC scam email, call or text: is this HMRC contact genuine?
• How small businesses can tackle fake online reviews
• What does product liability insurance cover?

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