Zero tolerance towards scams, say e-commerce firms amid surge in cases

When it saw a spike in fraudulent activity in February at the start of the pandemic, Carousell quickly took action - removing inflated listings of Covid-19-related items such as face masks, and suspending user accounts.

Reports of suspicious listings were reviewed within 24 hours; more than half within an hour.

Since then, the online classifieds marketplace's fraud rate has declined month-on-month, said chief of staff and vice-president of operations Tan Su Lin.

For three months, it has maintained a 0.036 per cent fraud rate, or about three fraud cases in every 10,000 transactions, in spite of an increase in transactions on the platform.

ZERO TOLERANCE

E-commerce firms say they have zero tolerance towards scams on their platforms, even as such cases rose sharply in the first half of the year according to mid-year crime statistics released on Wednesday.

E-commerce scams were the most commonly reported, up by 73.8 per cent to 2,089 cases, and the amount cheated in such scams also shot up to $5.4 million from $1 million a year ago.

Transactions on Carousell made up the lion's share with 884 cases, up from 532, and there were also increases on other platforms such as Shopee, Facebook and Lazada.

While Shopee did not comment on the latest crime figures, a spokesman said it has a range of security measures in place to detect and prevent fraud.

Besides periodic scam prevention notifications, warnings appear if and when a seller is found trying to route buyers outside the app for transactions.

Payments are also temporarily held in escrow until receipt of the order is confirmed.

Carousell has similar payment protection and it is mandatory for high-risk listings such as masks and electronics.

While she did not give exact figures, Ms Tan said Carousell suspended the same volume of fraudulent accounts in the first half of 2020 as it did for the whole of 2019.

It is now tightening its account creation process as it found that users with multiple accounts made up about 20 per cent of all fraudulent users.

Lazada attributed the rise in scams on its platform to an acceleration in e-commerce adoption. It said: "There are now a lot of people who are new to online shopping, and thus more vulnerable since they do not know how to protect themselves."

Meanwhile, social media impersonation scams, which grew more than tenfold in the first half of the year, took place most often on Facebook and Instagram. - KOK YUFENG