NICOLE Kidman, Meghan Markle, Oprah, Dr Oz, Lisa Wilkinson – celebrities we regularly see on TV and read about on the web and whose names are now being used by scammers to trick us out of our money.
Consumer watchdog the Australian Competition and Consumer Commission is warning people not to be caught out by celebrity endorsement scams with reports about this type of fraud to Scamwatch increasing 400 per cent in 2018 and losses so far totaling more than $142,000.
Most of the reports to Scamwatch involve scam advertisements running on Google ad banners or as ads in Facebooks news feeds.
People aged 45 and older accounted for 63 per cent of losses and women are more likely than men to fall victim, according to Scamwatch.
The scam works by consumers signing up for a ‘free trial’ of a product which has supposedly been endorsed by a celebrity.
The consumer is required to provide their credit card details but the ‘free trial’ has strict terms and conditions such as having to return the product within a near impossible timeframe, and an automatically renewing subscription that is difficult to cancel. These terms are often only visible on the document that arrives with the product.
“The growth in these scams is very concerning, particularly as over half the reports we received included a financial loss,” said ACCC deputy chairwoman Delia Rickard.
“Most people lost between $100 and $500 and in one case, a victim lost more than $50,000 through fake celebrity endorsement of an investment scheme.
“The groups behind these celebrity endorsement scams are organised and sophisticated fraudsters who are often involved in other scams. It’s easy for them to create fake ads and websites to give credibility to their con, so people need to be very careful and sceptical about ads they read on social media and websites,” Ms Rickard said.
“It is vital to research and read independent reviews of the company. Consumers should verify celebrity endorsement of products from the celebrity’s official website or social media account.”
The ACCC is calling on Google, Facebook and Instagram to do more to crackdown on these fake ads to prevent scammers reaching potential victims.
“ These tech giants must do more to quickly suspend ads, as every time consumers click on a scam ad they are at risk of losing money,” said Ms Rickard..
“If you are caught up in one of these scams, call your bank immediately to try and arrange a chargeback and to stop any further debits to your credit card.”
Here are some of the celebrities who have been used in celebrity endorsement scams based on reports to Scamwatch from members of the public.
- Cate Blanchett
- Deborah Knight (Nine News Sydney presenter)
- Delta Goodrem
- Dr David Sinclair (Head of Ageing Lab UNSW)
- Dr Oz
- Emma Thompson
- Georgie Gardner (Today Show)
- Jessica Rowe (Studio 10)
- Kyle Sandilands
- Lisa Wilkinson (Ch 10)
- Mark Shuttleworth (BBC/CNN)
- Meghan Markle
- Mikhail Varshavski (Dr Mike – US Celebrity)
- Nicole Kidman
- Sally Field (American actress)
- Sonia Kruger (The Voice, Today Extra)
- Steve Baxter (Shark Tank)
For more advice on how to avoid or report scams, visit Scamwatch.