The Consumer Goods and Services Ombudsman (CGSO) says South African consumers are vulnerable to online shopping scams and fake websites.
Speaking to SABC News, Ombud Lee Soobrathi explained the risks consumers face and outlined measures they can use to protect themselves.
“E-commerce has become a great part of what we do, but with it comes a lot of risks,” said Soobrathi.
“We know how prevalent fraud is. We know how easy it is for someone to get your credentials online.”
He explained that the best approach to protecting yourself is to be proactive.
“When transacting online, you have to be proactive. You have to do your homework and understand who you are contracting with,” he said.
Soobrathi added that shoppers should ask various questions before placing an order with an e-commerce player they haven’t transacted with before.
“If I don’t receive my goods on time. If I’m overcharged on my card, what are my options? Who do I contact?”
“That’s where the ombuds get involved because we are the method of redress for you to be heard and for the complaint to be resolved,” he added.
Soobrathi said a good proactive practice is to take a photo of the product listing if you spot something you’d like to order.
That way, if the incorrect or fraudulent product is delivered, you will have a record of what you were led to believe you were purchasing.
The CGSO recently released its annual report for the year ended 29 February 2024, revealing that despite online shopping only making up 5% of retail transactions, it led to the largest number of complaints submitted to the CGSO during the financial year.
Soobrathi said that most complaints involved customers not receiving their orders on time or at all, purchases that didn’t resemble their listings, or defective goods.
“In brick-and-mortar stores, customers have the opportunity to inspect goods and — except for furniture or large appliances — generally do not rely on the supplier to deliver,” he said.
“And, when goods are defective, the return and refund process is often handled in-store.”
This process becomes complex when third-party sellers are involved.
“Most consumers are unaware that they have contracted with a third-party seller until things go wrong,” said Soobrathi.
“If the third-party seller subsequently ghosts the customer, very little redress is available.”
The table below shows the contribution of complaints the CGSO received from each sector during the 2023/24 financial year.
Sector | 2021/22 | 2022/23 | 2023/24 |
Online transactions | 25.00% | 34.00% | 26.00% |
Appliance manufacturers and retailers | 14.00% | 15.00% | 18.00% |
Satellite & Telecommunications | 17.00% | 14.00% | 16.00% |
Furniture retail | 12.00% | 11.00% | 14.00% |
Clothing retail | 7.00% | 4.00% | 6.00% |
Groceries | 4.00% | 4.00% | 5.00% |
Fitness | 4.00% | 4.00% | 5.00% |
Travel services | 4.00% | 5.00% | 4.00% |
Building sector | 6.00% | 5.00% | 3.00% |
Timeshare | 1.00% | 1.00% | 1.00% |
Security & Tracking | 2.00% | 1.00% | 1.00% |
Accommodation | 2.00% | 1.00% | 1.00% |
Weddings | 1.00% | 1.00% | 0.00% |
Soobrathi also discussed South African consumers’ vulnerability to fraudulent websites. Again, he said being proactive is key to protecting yourself in such situations.
“With the advent of e-commerce and digitisation, the risks are going to come from rogue entities,” he said.
“We issue consumer alerts. If we feel there’s a rogue website or supplier that’s taking advantage of consumers, we, through the media and other platforms try to educate consumers so that they stay away from these sites.”
He added that the consumer alerts are all available on the CGSO’s website.
Soobrathi said the organisation wants to warn consumers about what to look out for regarding potential fraudulent websites.
“If you are on a website and anything seems uncertain, if a URL, for example, has a 3 instead of an ‘E’ or an ‘I’ instead of an ‘L’, these are the minor things that one needs to look out for,” he said.
“Make sure you do your best to protect yourself and while we can’t 100% avoid these fraudulent websites, the proactive approach is best, and if you get an inkling that something is wrong, we would suggest staying away from it and not transacting at all.”