Fraudulent Advertising Online

Fraudulent advertising is rapidly emerging as a new risk to consumers shopping online, where millions of consumers are exposed to thousands of fraudulent advertisements taking them to thousands of illegitimate e-commerce websites that defraud and/or sell counterfeit products and deceitful services.

​A new report from Transnational Alliance to Combat Illicit Trade (TRACIT) and the American Apparel & Footwear Association (AAFA) shows that 70 major international brands were targeted by fraudulent advertisements on Instagram and Facebook since 2017, some of which receive up to a quarter of a million views before they are detected. 

​The report investigates and points out that Internet-based platforms for social networking and shopping from home have inherent systemic weaknesses that are exploited by criminals to sell any variety of counterfeit or illegal product with little risk of apprehension. The lack of sufficient policies and procedures to verify an advertiser’s true identity and limited vetting during the onboarding process are identified as the main vulnerabilities that enable fraudulent advertising online. 
Featured Webinar: Argentina

TRACIT presents report to AntiPiracy Association of Argentina

1 September 2020, (Buenos Aries, Zoom). At the invitation of the Anti-Piracy Association from Argentina, TRACIT presented the findings from its report on “Fraudulent Advertising Online: Emerging Risk and Consumer Fraud.”

The webinar explained how Internet-based platforms for social networking or shopping from home have inherent systemic weaknesses that enable criminals to exploit these gaps to sell any variety of counterfeit—or any illegal product or substance—with little risk of apprehension. Participants discussed the application of policy recommendations to Argentina.
WHAT ARE THE DANGERS?
  • ​Consumer risks - Fraudulent adverts give innocent consumers a false impression of authenticity. Counterfeit goods are generally of poor quality, will not last, are not guaranteed, and may be dangerous.  
  • Business and brand owners - IP theft in the form of trademark counterfeiting and copyright piracy stifles economic growth and job creation by discouraging innovation, reducing incentives for companies to invest in R&D and inhibiting creative industries from realizing their full potential. 
  • Data privacy - Most fraudulent websites show a disregard for data privacy of any type, including customer data, security, and financial information. Since these websites rarely use any form of security, consumers are often also exposed to credit card fraud, identify theft, and other cybercrimes.
  • Organized crime - The fraudulent and infringing adverts discovered on Facebook often share similar characteristics and suggest that organized crime groups or organized illicit networks are operating these fraudulent ad campaigns. 
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Transnational Alliance to Combat Illicit Trade (TRACIT) is an independent, non-governmental, not-for-profit organisation under US tax code 501(c)(6).
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