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Got your Black Friday strategy sorted? Me too! I’ve unsubscribed from all marketing alerts, will stay offline next Friday and get a whopping 100 per cent discount on items I’m not tempted to buy.
It seems I am not alone. UK spending on the imported US retail phenomenon is predicted to fall by more than a quarter this year compared with last year, according to PwC’s annual Black Friday survey.
Shoppers have discount fatigue. Desperate to secure our Christmas spend, most online retailers have already launched their Black Friday sales. Some are stretching it by calling it “Black November”.
The level of hype usually trumps the level of discounting, as past surveys have shown. Even though 56 per cent of Brits said they didn’t intend to buy anything in a Black Friday or Cyber Monday sale this year, PwC still predicts £5.6bn will be spent.
If you have an eye on a particular item online, my first tip is to use price tracking software to see how good that discount really is (I like CamelCamelCamel, but also see Alertr and PriceSpy).
The free app Trolley.co.uk will let you compare deals and check the price history of supermarket offers. Most stores launched Black Friday discounts on booze this week. But that is enough about shopping!
The people who are really gearing up to take advantage of bargain hunters this year are the scammers.
Purchase scams — where you order and pay for items online that never arrive — are among the fastest growing forms of fraud, according to the latest data from UK Finance. Various studies show that younger generations are more likely to fall victim, because so many scams originate on social media.
Yawning discounts are one red flag. My FT colleague Matt Garrahan fell for what turned out to be a fake Instagram ad offering him 80 per cent off in a Paul Smith clearance sale. Clicking on the ad took him to a very convincing fake Paul Smith website.
Time pressure to purchase is another. Often, fake sites have a clock counting down the minutes until discounts expire to push the purchaser into entering their card details before they notice the website is dubious.
The Online Safety Act will force social media platforms to police fake ads much more thoroughly — but don’t hold your breath, as it won’t be fully implemented until the end of 2025. So be very wary of clicking on any ads and double check that domain names are the retailer’s official website.
Ahead of the peak online shopping season, banks are warning customers about the scourge of phishing scams doing the rounds. If you’re expecting a delivery, it’s easier to fall for fake emails and texts about missed parcels with links you can click to “track your package”.
Poor spelling and grammar used to be a dead giveaway that a website, email, ad or message was fake. However, consumer group Which? warns that generative AI is enabling fraudsters to send much more professional communications, not to mention voice cloning, video deep fakes and more.
“This is not hypothetical — it’s quite real,” says Rocio Concha, director of policy at Which?, who warns “the level of sophistication is such it will soon be impossible for consumers to protect themselves.”
Huge numbers of people are conned into entering their personal details into phishing sites, which scammers can then use to orchestrate much more elaborate deceptions. In push payment fraud, for instance, bank customers are tricked into transferring money to a scammer.
If you’re duped into using your bank card to buy fake goods online, your bank will refund the money in the vast majority of cases (eventually). But if you transfer money directly into someone else’s bank account, your bank will only refund you if you can prove that you were not unduly negligent.
For years, Which?, the consumer group, has campaigned against the “lottery” of compensation, which varies hugely between banks, and has pushed for this data to be published. This month, the Payment Systems Regulator (PSR) finally obliged — so see where your bank ranks on the table below.
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No surprises that TSB, the only bank to offer a fraud refund guarantee, is top of the table. However, it’s notable that challenger banks need to pull up their socks.
The next stage is that banks will be forced to refund all victims of push payment fraud. The PSR has been consulting on how to implement this but some key issues have emerged.
First, the cost of compensating fraud victims would be split 50:50 between the bank that originated a transfer, and the one which received it.
In the first six months of this year, that would have left the banks on the hook for £239mn of total push payment fraud losses, rather than the 64 per cent of this figure (£153mn) that was actually paid out.
This would escalate costs for the banks at the bottom end of those refund rankings, presenting a bigger problem for the challenger banks.
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Second, if customers know they have greater protection from fraud losses, will they let their guard slip?
To counter the feared “moral hazard”, the industry is lobbying for customers to be charged an excess on claims, with amounts between £100 and £250 being suggested.
This is wrong. No consumer wants to fall victim to a scammer. Even if your financial position is restored, the stress and emotional impact of being had, reporting it and battling to get your money back cannot be recouped.
Furthermore, Which? estimates around half of push payment fraud victims lose £250 or less, so a high excess would exclude a lot of people.
Finally, there are real fears that AI could cause levels of fraud (and compensation) to explode. Used to spot fraud within banking systems, AI is a powerful prevention tool, but banks and campaigners want programmed-in protections so scammers cannot ask generative AI to write their scripts.
Considering the glacial pace of information sharing between banks, regulators, tech companies, online platforms and telecoms companies, I am not filled with confidence about the banks’ ability to introduce these kinds of safeguards alone.
Consumer protections in the pipeline are a step in the right direction, but until we see more powerful incentives for companies in different sectors to co-operate and share information I fear the scammers will remain two steps ahead of the game.
Claer Barrett is the FT’s consumer editor and the author of ‘What They Don’t Teach You About Money’. claer.barrett@ft.com Instagram @Claerb