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O.T. As online shopping grows, so do dangers by Rob Lever
Thu Nov 23, 1:55 AM ET

http://news.yahoo.com/s/afp/20061123/tc_afp/afplifestyleuseconomyitcrimeretail_061123065505

WASHINGTON (AFP) - As growing numbers of Americans turn to the Internet for holiday shopping, experts warn that online dangers such as fraud and identity theft are increasing as well.

One out of 10 people shopping online could become a victim of online fraud this holiday season, according to a report by the National Consumers League and National Cyber Security Alliance.

Still, the ease of online shopping and growing popularity of the Internet is becoming irresistible for time-strapped consumers.

A survey of some 9,000 US adults by Zogby International found two-thirds were planning to make at least one online purchase for the holiday season.

"Instead of fighting for a parking space and waiting in long lines, many shoppers have turned to the Internet to help with at least some of their holiday shopping," the research firm said.

Research firm comScore Networks predicts online retail consumer spending for the 2006 holiday season excluding travel will be above 24 billion dollars, a 24 percent rise from last year.

With the kickoff of the Christmas shopping season on Friday -- the day after the Thanksgiving Day holiday -- analysts see a greater share of sales going online.

While traditional stores call the opening day "Black Friday," e-commerce sites were gearing for "Cyber Monday," with many people shopping from computers at their offices.

A survey for the online retail association Shop.org found the number of people who will shop online for holiday gifts from work is expected to surge to 61 million people this year, up from 51.7 million people last year.

ComScore expects 600 million dollars in sales on Cyber Monday, which would be the biggest online shopping day on record.

But cyber-crooks are honing their tactics and stepping up their efforts as this trend increases, analysts say.

A report by the research firm Gartner Inc. found the number of so-called "phishing" e-mails -- designed to trick recipients into revealing personal or financial information -- has doubled in the past two years and that losses topped 2.8 billion dollars.

Gartner estimated that 24.4 million Americans have clicked on a phishing e-mail in 2006, up from 11.9 million in 2005, while 3.5 million have given sensitive information to the phishers, up from 1.9 million.

The average loss per victim has grown from 257 dollars two years ago to 1,244 per victim in 2006.

"The good news is that, this year, fewer people think they lost money to phishers, but when they did lose, they lost more," said Avivah Litan, a Gartner analyst.

"The average loss per victim nearly quintupled between 2005 and 2006, and the thieves seem to be targeting higher-income earners who are also more likely to transact on the Internet."

Experts warn that other online dangers have not disappeared either, such as spyware, hacking and e-mail fraud schemes, despite improvements in software and more consumer awareness.

The SANS Institute, a high-tech training center, said recently there is "an explosion in cyber crime, driven in part by a surge in the number of online criminals in Asian countries along with continuing growth in attacks from Eastern European countries."

"The surge is so great that several banks have reported 400 to 500 percent increases in losses to cyber fraud from 2005 to 2006," the institute said.

Security experts say consumers can minimize the risks by following a few common-sense guidelines: use firewalls and security software; use reputable merchants; and avoid using an unencrypted or open wireless network. Caution is also advised about giving away financial information.

"Knowing who you're dealing with and providing your financial information securely are very important when you're shopping online," said Susan Grant, Director of the National Consumers League fraud information center.


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