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COVID-19: European Commission and national consumer authorities work to prevent scams and unfair practices

As the new virus spreads across the EU, rogue traders advertise and sell products, such as protective masks, caps and hand sanitisers to consumers which allegedly prevent or cure an infection. It is in the general interest to guarantee a safe online environment where consumers, in particular in the context of distress caused by the current crisis, feel well protected against any illegal practices that potentially put their health at risk.

The main findings of a previous screening dated 26 May 2020 show that rogue traders continue to mislead consumers with a variety of illegal practices but online platforms are taking measures to address this. The European Commission will continue to keep consumers informed whenever necessary with updated advice to consumers and traders.

Read the findings here:

Coronavirus Following Commission S Call Platforms Remove Millions Of Misleading Ads

 

Advice to consumers and traders*

Consumers should be on high alert when shopping online, and traders should be fully aware of the rules.

As recent checks carried out by national Consumer Protection Cooperation (CPC) authorities have shown, rogue traders use various means to attract consumers, there are a significant number of products which are falsely presented as able to cure or prevent COVID-19 infections or bear false conformity certificates and in some cases, fraudsters also use offers to steal email addresses and passwords.

Where consumers come across unsupported or dubious offers on online platforms, they should use the reporting tools provided by the platform operator or contact the competent national authorities or consumer organisations.

Consumers can also look for general information from authoritative sources that many platform and website operators link on their websites in order to help consumers identify false information or claims in relation to the COVID-19 pandemic.

How to identify potential scams?

Follow these tips for a safe online shopping experience:

  • In the EU, traders must provide their identity and contact details: consumers should consider shopping elsewhere if this information is not easily available.
  • Beware of spellings errors such as “C?V?D?19”, “cor/na?vir?s”: these are commonly used to avoid detection by website operators’ algorithms. Read web addresses and page titles carefully, and avoid using pages with systematic misspellings.
  • Remember that there is currently no scientific proof that any food or food supplement can cure or prevent COVID-19 infections.
  • Products must be clearly identified with precise and understandable text descriptions: consumers should be cautious when they see mainly promotional elements such as :
    • slogans commonly linked to the pandemic, e.g. “#stay safe”, “stay at home”, “social distancing”;
    • images of a virus next to the image of the product;
    • endorsements by name or logo by:
      • doctors, health professionals, and other experts;
      • artists, athletes, bloggers or other celebrities;
      • government authorities, official experts or international institutions;
      • news articles, academic reviews and other content presented as coming from authoritative sources;

Consumers should identify pressure selling techniques and avoid falling into a trap, such as:

  • products advertised as a “unique opportunity”
  • claims that a product is the “only product offering effective protection”, the “only testing kit for home use” or sold at “the lowest price on the market”;
  • scarcity claims such as “only available today” or “sell out fast”
  • very high discounts.

Market conditions should not be falsely presented:

  • consumers should be aware of prices that are well above or below the normal price for similar products;
  • consumers should check more than one website for an understanding of average prices;
  • and consumers should be aware that in some countries, governments have actually regulated the price for high-demand products, such as protective masks and/or sanitising gels

The OECD also issued its own advice on Protecting online consumers during the COVID-19 crisis. The findings refer to Unfair, misleading and fraudulent commercial practices. 

“As COVID-19 has proliferated worldwide, so too have online scams seeking to take advantage of the crisis. In the United States, more than 22 000 consumer complaints about COVID-19 fraud have been reported to the Federal Trade Commission (FTC) between January 2020 and mid-April 2020, amounting to over USD 22 million in consumer losses. Some phishing, malware and identity theft scams have enticed consumers to share their data under false pretences, purporting to be from health or disease control organisations like the World Health Organisation. Other scams seek to financially defraud consumers, including fake charity scams, as well as prominent company impostor scams, for example advertising “free” Netflix subscriptions. Other examples include promising hygiene products that never arrive, or offering fake COVID-19 tests. Reports also indicate that illegal moneylenders are increasing their efforts to exploit financially vulnerable consumers. In the United Kingdom, for example, the England Illegal Money Lending Team has issued a warning about COVID-19 payday loans, while Japan’s Financial Services Agency and National Police Agency

Taking advantage of consumer fear and anxiety, scammers have also propagated deceptive and scientifically unsupported claims that certain products can prevent or treat COVID-19. Amid consumer anxiety, claims such as “sells out fast” may be false or misleading, and may reinforce consumer anxiety and panic buying.
Price gouging is another issue for consumers, as some businesses have sought to maximise profits from increased demand for essential goods such as face masks and hand sanitiser, or basic grocery items or printers, by exponentially raising their prices.
In some countries, consumer and competition agencies are addressing these issues, ensuring that the remedies that are put in place to address pricing gouging do not have deleterious effects lingering beyond the crisis.The COVID-19 crisis has also heightened product safety risks. Recall notices of facemasks that do not adequately filter airborne particles and may expose consumers to risk of infection if not combined with additional protective measures, have been for example recently submitted to the OECD’s Global Recalls portal, a database for governments to share recall information.
Read the entire report here: 

Oecd


On 10th June 2020, the EU issued  its JOINT COMMUNICATION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Tackling COVID-19 disinformation – Getting the facts right

Section 8 deals with public health and consumers’ rights:

“A particular feature of the COVID-19 crisis has been a focus on exploiting consumers. Manipulation, deceptive marketing techniques, fraud, and scams exploit fears in order to sell unnecessary, ineffective and potentially dangerous products under false health claims, or to lure consumers into buying products at exorbitant prices. Whilst this kind of content may contain disinformation, if it infringes the consumers’ acquis it is illegal content and requires a different response, under consumers’ protection laws and by competent authorities. 

Following the Commission’s call, platforms have removed millions of misleading advertisements concerning illegal or unsafe products.The Commission coordinated a screening (‘sweep’) of websites, to find out where consumers in the EU are being subjected to content promoting false claims or scam products in the context of COVID-19. The sweep – carried out by the Consumer Protection Cooperation (CPC) Network – involved both a high-level screening of online platforms, and an in-depth analysis of specific advertisements and websites linked to products with demand boosted due to the virus. The result is that platforms have removed or blocked millions of misleading advertisements or product listings.

The Consumer Protection Cooperation Network of national authorities has worked with the Commission to fight these practices in a coordinated manner. The Commission invited major platforms to cooperate with consumer authorities and take proactive measures to counter scams. This exchange with the major online platforms is bearing fruit, but work will have to be pursued, notably under the future Digital Services Act.

Rogue traders, however, find ways to fly under the radar of the platforms to exploit consumers’ vulnerabilities, circumvent algorithmic checks and set up new websites. Such practices are also found on independent websites, which attract consumers through advertisement displayed e.g. on social media and webmail portals or in sponsored ranking on search engines. Thus national consumer authorities remain on high alert and will continue to work together with the Commission to protect consumers online.  

The Commission is stepping up cooperation and information exchanges with platforms, as well as with advertising self-regulatory bodies, to develop automatic tools to find misleading advertisements. The platforms should regularly report, until the end of the crisis, on the effectiveness of their measures and on new trends.

Many fraudulent websites are under domain names using COVID-19 related keywords such as ‘corona’, ‘mask’ or ‘vaccine’. These websites are especially damaging when falsely presented as legitimate or governmental websites. The Commission engaged with the domain name industry to share and promote good practices to prevent speculative and abusive domain names use and agreed on similar measures with EURid, the operator of the ‘.eu’ domain.” 

Read the entire communication here:

CELEX 52020JC0008 EN TXT

*Updated on 26 May 2020 following the results of the screening (‘sweep’) of online platforms and advertisements launched on 30 April 2020.

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