Exclusive
Status: 08/31/2021 5:00 a.m.
According to research by the SWR magazine market check increasingly used for fraudulent offers. So far, however, the social network has done little to counter the abuse. The EU now wants to remedy the situation.
After research by the SWR consumer magazine Marktcheck increasingly used by fraudulent fake shops that place advertisements there. These advertisements often have a reach of several million users. The operators of the fraudulent shops take advantage of the fact that, for a corresponding fee, they can place advertisements on Instagram in order to then redirect users to fraudulent websites.
From Instagram to the fake shop
The advertisements lead to dubious internet shops via links. At first glance, these look serious. In addition, it is usually not evident that the operators are based in China. The PayPal payment service is also used for payment.
However, if you order something from these providers, you will not receive the product that is advertised. Instead, cheap, inferior products are sent to the buyer, some of which have little to do with the order.
Trial orders indicate fraud
For testing purposes the SWR ordered goods from ten vendors who have run very large advertising campaigns on Instagram. Some of the promotional videos had nearly five million views, on Instagram alone.
Bucket instead of oven: the fake shops tested delivered different products or rubbish.
The advertised product was not delivered in any of the test purchases. In one case, instead of a laptop stand, a few wooden boards were sent – in another case they received it SWR Instead of an outdoor oven made of stainless steel, a cheap tin bucket from China.
IT expert: scam as a “mass phenomenon”
The employees of the “Watchlist Internet” from Vienna have been observing fraudulent activities on the Internet for a long time, also on behalf of the Austrian government. There are already more than ten thousand fraudulent Internet sites in their database.
IT expert Hiscox fears the phenomenon will spread.
IT expert Declan Hiscox from the Watchlist warns of the fraudulent scam on social media platforms: “If we look at the phenomenon of fraudulent online shops, the trend is absolutely upwards. The same applies to advertising on social media -Platforms like Instagram, TikTok or Facebook for exactly such offers. ”
Fraud despite PayPal buyer protection
Even those who have paid for the product via PayPal are not necessarily safe despite the so-called buyer protection – they have that too SWR– Research shown. After the complaint has been reported, PayPal always asks the buyer to return the product to the fake shop.
However, a return is impossible for providers who act with the wrong imprint. In addition, the costs of sending a parcel to China are usually higher than the purchase price of the products – this makes a return financially pointless.
According to Louise Beltzung from “Watchlist Internet”, the fraudsters are using a loophole in the PayPal regulations.
The fraudsters deliberately took advantage of this, says Louise Beltzung from the “Watchlist Internet”. Your victims would then often give up and forego repayment, which the fake shops took into account. So she and her colleagues have just programmed a browser plug-in that is supposed to detect fake shops fully automatically.
According to SWR research: Instagram blocks providers
As part of the research, the SWR Both Instagram and PayPal transmit the names of fake shops. However, neither company commented on the specific cases. Only one provider was contacted after the inquiries of the SWR blocked by Instagram. Another shop was, apparently by the operator, taken offline immediately after the SWR-Reporters had to identify themselves as journalists.
A number of other fake shops are still online today. Confronted with this, the parent company of Instagram replies: “We are constantly working to improve our technologies even further to combat this form of fraud and want to do even more in the future to keep such accounts off our platforms.”
Payment service keeps a low profile
PayPal also did not comment on the specific fake shops – not even when asked why they are still allowed to use PayPal services today. In general one shared that SWR with: “PayPal does not tolerate abuse of its platform for fraudulent activities and investigates reports of violations of the PayPal usage policy. Each individual case is handled by a team of experts […] processed.”
This is contradicted by a long-standing PayPal employee in Berlin, to whom the SWR got in touch during the research. According to him, PayPal cares far too little about the complaints: “For PayPal, the calculation is very simple: if the sales of the seller are correct, the complaints are irrelevant for PayPal. The mails then send to the customer centers in Ireland or China.” PayPal did not comment on this specific allegation.
EU advisors: consumer protection gaps
The lawyer Christoph Busch is one of the EU Commission’s specialist advisors on the subject of online trading. He is of the opinion that consumer protection on social media platforms must be significantly improved. The current EU regulations are from 1999 – “that is, from a time when Instagram and Co. didn’t even exist,” says Busch.
Lawyer Busch hopes for a remedy through the planned “Digital Services Act” of the EU.
The EU has recognized the problem, says the lawyer. The EU Commission is currently working on a new “Digital Services Act”, “and it is intended to formulate duties of care for online platforms, including Instagram, for example, and for platforms on which sales contracts can be concluded an obligation is to be introduced that the Identity of the dealer should be verified “.
But the lawyer fears that it will take at least two years before the new regulations come into effect. Until then, also advise consumer advocates, users should only buy from shops they know – and be careful with unknown shops outside the EU.