Risk, returns & timeframes illustration
1 min read
September 6, 2022
by
Belinda Nash

When a deal’s a steal 🛍️

Deal too good to be true? It might be triangulation fraud. This is when thirsty bargain hunters spot a deal, buy it and receive the goods from the legit retailer. The problem? Everyone’s getting scammed in this US$6.4 billion fraudulent industry.
Risk, returns & timeframes illustration
1 min read
September 6, 2022
by
Belinda Nash

When a deal’s a steal 🛍️

Deal too good to be true? It might be triangulation fraud. This is when thirsty bargain hunters spot a deal, buy it and receive the goods from the legit retailer. The problem? Everyone’s getting scammed in this US$6.4 billion fraudulent industry.
Table of contents
Free Getting Started Course
Take your first, or next, step to becoming a confident investor with Hatch's free online course – just 10 minutes a day, for 10 days.
Weekly news from Wall St
Subscribe to The Fry Up - your weekly sizzle of headline-grabbing share market news. Read by 60,000 Kiwis to help them take charge of their investing journey.

When a deal’s too good to be true, weeelll…. Just when you thought buying fake Nikes, Chanel and Apple gadgets was your #1 problem on the Internet of Things, meet: triangulation fraud. Nope, not consumer extortion by UK power companies. Picture this: chatty coworkers have prompted your search for noise-cancelling headphones. 🎧 You spot a sweet deal, buy it, receive it and life’s good. Weeelll… you might’ve been played, and may not be the only loser. So who else is being caught in the ecommerce fraud game, last year worth an estimated US$6.4 billion - up 140%? 

This shady side of money making starts with a fraudster creating a merchant account so their business appears legit, perhaps using Stripe, Paypal (PYPL), Block (SQ) or Amazon Pay (AMZN). Next they upload killer deals that undercut the competition, say on eBay (EBAY), Alibaba (BABA - ADR) or Amazon. You purchase your deal, they keep your money. 🛒 Meanwhile, the fraudster places an actual order with the actual merchant that ships your swag using someone else’s credit card (bought for about $1 each). So… everyone’s a ‘winner’? 💳 

Nope. And this fraud could ping you twice. Your honestly entered Visa (V), MasterCard (MA) or Amex (AXP) digits could be skimmed then added to a list that’s sold or used again. So who else loses? If your card’s been used for triangulation fraud, with your Carmen Sandiego sleuth skills, you’ll need to spot stuff you didn’t buy on your credit card statement. 🔍 Then alert your card company - one possibly poised to make money in an exponentially cashless world - who repays your money, then charges back to the legit seller who sent the goodies that were bought fraudulently. 🤯 

But because triangulation fraud is skimming a little bit at a time, neither the credit card companies nor legit sellers have ‘enough skin in the game’ to shut it down. Your best bet? When a deal’s too good to be true, it probably is.

Belinda Nash
Finance writer
Linkedin

We’re not financial advisors and Hatch news is for your information only. However dazzling our writing, none of it is a recommendation to invest in any of the companies or funds mentioned. If you want support before making any investment decisions, consider seeking financial advice from a licensed provider. We’ve done our best to ensure all information is current when we pushed ‘publish’ on this article. And of course, with investing, your money isn’t guaranteed to grow and there’s always a risk you might lose money.

Join the Kiwis who are hatching their tomorrow and have invested more than $1 billion with Hatch.

More recent news articles

More recent learn articles

6 min read
Nov 28, 2023

Black Friday’s record-breaking US$9.8 billion US online sales, US$70.9 billion globally

New Zealand imported Black Friday from the US, but that doesn’t mean we’re spending up large during tighter economic times. While Black Friday spending soared in the US, it seems Kiwis weren’t quite so keen to part with their hard-earned cash. So who was spending up large in record US Black Friday shopping?
Read more
6 min read
Nov 21, 2023

Underrated Thanksgiving stocks and hopes for a seasonal market rally

While 2023 may have felt like a bumpy ride for investors it seems that recession predictions were stymied by a buoyant American economy. Could the road ahead bring in fresh optimism echoing rallies of holidays past?
Read more
5 min read
Nov 14, 2023

Affirm shares surged 24% ahead of holidays splurge

In a world of instant gratification, is buy now pay later (BNPL) just what we do now? While BNPL providers aren't rapidly bringing on more customers and people aren’t using BNPL more, shoppers are missing more payments sinking into a debt cycle helping providers’ revenue to climb. Is this why Affirm’s stock has soared 153% this year?
Read more

More recent news articles

More recent learn articles

6 min read
Nov 28, 2023

Black Friday’s record-breaking US$9.8 billion US online sales, US$70.9 billion globally

New Zealand imported Black Friday from the US, but that doesn’t mean we’re spending up large during tighter economic times. While Black Friday spending soared in the US, it seems Kiwis weren’t quite so keen to part with their hard-earned cash. So who was spending up large in record US Black Friday shopping?
Read more
6 min read
Nov 21, 2023

Underrated Thanksgiving stocks and hopes for a seasonal market rally

While 2023 may have felt like a bumpy ride for investors it seems that recession predictions were stymied by a buoyant American economy. Could the road ahead bring in fresh optimism echoing rallies of holidays past?
Read more
5 min read
Nov 14, 2023

Affirm shares surged 24% ahead of holidays splurge

In a world of instant gratification, is buy now pay later (BNPL) just what we do now? While BNPL providers aren't rapidly bringing on more customers and people aren’t using BNPL more, shoppers are missing more payments sinking into a debt cycle helping providers’ revenue to climb. Is this why Affirm’s stock has soared 153% this year?
Read more