Online Scams in the Philippines to Watch Out For

Venus Zoleta

Venus Zoleta

Last updated January 03, 2020

Technology connects people in a matter of clicks even when they're miles apart. But like any good thing, there’s also a dark side to it. Having a fairly visible online presence—and sometimes any online presence at all—can open one up to the risk of online scams.

Nobody likes getting scammed, but not everyone knows how to secure themselves against online scams.

How do you ensure your safety when making financial transactions over the internet? First, be aware of the common online scams to avoid falling prey to them and losing your hard-earned money.

Online Shopping Scams

Online Scams in the Philippines - Online Shopping Scams

Online scams in the Philippines are on the rise, based on the latest data from the Philippine National Police Anti-Cybercrime Group (1). Most cybercrime complaints that the PNP receives come from victims of online shopping scams.

How Online Shopping Scams Work

An online scammer pretends to be a legitimate seller using a fake ad on an authentic e-commerce platform, social media site, or a fake website. The fraudster tricks a customer into paying for a non-existent product and then delivers nothing and runs away with the money.

Other online scammers are a little more clever. They’re good at deceiving people with their cunning sales pitch, making it appear they’re selling a genuine product. The customer then receives a fake product or one that’s entirely different from what’s advertised.

How to Avoid Online Shopping Scams

1. Learn How to Spot an Online Scammer

When buying items online, watch out for red flags. Here are the common warning signs of online shopping scams:

  • Products with incredibly low prices compared to other online shopping sites, especially for high-end brands
  • Product features and benefits that sound too good to be true for the price
  • No additional details and pictures of the product
  • Inconsistent answers on questions about the product
  • Refusal to meet up or making a lot of excuses
  • Insisting on immediate payment before sending the order
  • Asking customers to deposit payment directly to a bank account or mobile wallet account instead of going through the online shopping site’s preferred payment method
  • Vague or non-existent info on shipping, return, and refund policies
  • Asking for customer’s financial information (via email or pop-up message) while browsing the site
  • No contact details on the website or social media profile

2. Shop Only at Trusted and Reputable Websites

Check the website’s address bar: its URL should start with “https” (not “http”) and there should be a closed padlock icon. These security features encrypt all communications between your browser and the website, protecting your sensitive information such as credit card number, address, and password.

Also, be cautious when buying from sellers on social media. While some entrepreneurs make money legitimately out of selling items on social media, online scammers take advantage of unsuspecting customers. Transact only with a seller who’s recommended by your trusted family and friends.

Unlike online stores and e-commerce platforms, social media sites provide less protection from online scams. Anyone can just create fake accounts and sell on social media. There’s no system to monitor sales and screen legit sellers from fraudulent ones. Also, customers aren’t protected from delivery issues and damaged items.

Read more: Best Online Shopping Sites in the Philippines

3. Verify the Product and Seller

Do your research before you shop. Before you trust an online shopping site with your credit card information, verify the company and browse reviews online.

This is a lesson actress Glydel Mercado learned the hard way when she fell victim to an online shopping scam (2). She purchased a projector with her credit card, but the item was never delivered. Had she done an online search of the company, she would’ve seen numerous complaints posted by disappointed customers.

4. Ask the Seller a Lot of Questions

People who sell genuine products provide as much information to potential customers. Feel free to ask as many questions as you’d like about the product. Specifically, ask about the condition, specs, reason for selling (for second-hand items), and where it’s made.

5. Never Share Your Personal and Bank Details

Think twice before giving your confidential information to individual sellers. Online shopping scams usually involve sellers who try to gain customers’ trust and then ask for their personal and bank account details.

When a seller requests your birthdate, address, credit card number, CVV, or other sensitive data, refuse and cancel the transaction.

6. Check the Seller’s Refund or Returns Policy

Legitimate and trustworthy online shopping sites have clear-cut, detailed, and fair policies on returns, refund, shipping, and customer data privacy. They have a dedicated customer service team that handles disputes or complaints on delivery or the product.

Make sure that you’re dealing only with online shops that have these features on their website. You can compare refund and returns policy of Lazada and Shopee here.

Read more: Make Money Online: How to be a Shopee or Lazada Online Seller

7. Use a Secure Payment Method

Cash on delivery is among the safest payment option, especially for high-value items, as it assures that you’ll get your order. Paying in cash works best if you’re buying from sellers on Facebook, Instagram, or Twitter.

If you’re shopping at an e-commerce platform, the most secure payment services to use are PayPal and credit card. If the seller asks you to pay outside the e-commerce site’s payment system, it’s likely a scammer.

Online scammers prefer payments via wire transfer, international money transfer, or cryptocurrency like Bitcoin. These payment methods make it hard for customers to recover their money.

Also, make sure to disable the option to remember your PayPal or credit card details on the online shopping site. It may be inconvenient to input your information each time you pay, but it’s a lot safer than when your phone or laptop gets stolen and someone gets hold of your confidential data.

Read more: Best Payment Options for Online Shopping

Online Banking Scams

Online Scams in the Philippines - Online Banking Scams

While online banking is convenient, it also comes with certain risks. The money you’ve worked hard for could disappear in an instant the moment a hacker gains access to your bank account.

Knowing how different banking scams work and how to avoid them can help protect yourself against these unfortunate events.

3 Common Online Banking Scams in the Philippines

1. SIM Swap Scam

Also known as “Palit SIM” scam, SIM swapping is a relatively new form of online fraud in the Philippines. Scammers pretend either as legitimate mobile subscribers or authorized representatives of a mobile subscriber and request telecommunication companies for SIM card replacement. Then, they use the mobile number to access their victims’ personal information, including bank account and credit card details.

2. ATM Skimming

Also called card skimming or data skimming, ATM skimming involves copying a bank accountholder’s personal information from the magnetic stripe on the back of an ATM card or credit card.

Scammers use illegal skimming devices to read the card’s magnetic stripe and steal the details in it, making a fake or cloned card to access the owner’s bank account and complete banking transactions like cash withdrawals and fund transfers.

3. Email Phishing

Ever received an email supposedly from your bank that asks you to confirm your account information by clicking on a link? Beware of this sign of email phishing. This illegal activity can trick you into filling out a form with your email password, credit card details, and other sensitive details via a fake website that looks similar to your bank’s online banking facility.

Phishing is one of the banking scams in the Philippines that continue to lure unsuspecting victims into providing their confidential data, allowing scammers to perform unauthorized transactions using the information they stole.

How to Avoid Online Banking Scams

1. Protect Your Personal Data

Never disclose your birth date, phone numbers, home address, email address, and other sensitive information on social media. Be careful when sharing images that may expose these details in public—avoid posting pictures of your passport, IDs, visa, and other documents.

Also, don't reply to any email that asks for your personal data. Banks never request confidential information from their customers through email. So when you receive one, just ignore it and never click on the provided link.

2. Always Monitor Your Bank Statements

When you detect any unusual activity on your bank account, or when you’ve provided confidential details, change your online banking password and notify your bank immediately. You can request the suspension of your online banking access to protect your account.

3. Protect Your PIN

Never share your PIN with anyone. When using an ATM, cover the PIN pad with your hand.

Also, be on the lookout for tampered ATMs. Before you insert your card into the slot, check if the PIN pad is loose, sticky, or has scratches—these are some signs of an ATM with a skimming device. For safety, use ATMs in well-lit areas with security cameras.

Online Investment Scams

Online Scams in the Philippines - Online Investment Scams

Investing is a great way to make money work for you. However, not all kinds of investments are legitimate and safe. Fraudsters use social media and websites to lure investors with get-rich-quick schemes and then run away with their victims’ money.

5 Common Online Investment Scams in the Philippines

1. Online Paluwagan Scams

Also known as onpal, online paluwagan works like the traditional, offline paluwagan. Members pool their funds together and take turns receiving money based on their respective payout schedules.

Onpal uses Facebook heavily to lure investors and run the paluwagan. Sending and receiving of payments are made through cash deposits, wire transfer, or remittances.

Onpal operates like the Ponzi scheme. Those who recruit people to join their online paluwagan promise large profits of 10% to 75% within a short period of one day to 90 days. A lot of onpal members reported never getting their investments back.

2. Fake Online Lending Companies

Watch out for online investment scams on Facebook that entice people to invest in moneylending or financing businesses that turn out to be fake. Investors are tricked into lending their money to a micro-financing or lending company to earn profits as high as 12% weekly or 48% monthly. Scammers make victims believe they’re running a legitimate online lending business.

Aside from offering unrealistic ROIs, online financing scammers pay the initial returns to investors but then they eventually disappear.

3. Bitcoin Investment Scams

Bitcoin scams dupe people into growing their money in cryptocurrencies through their pages or secret groups on Facebook. Transactions are done through bank deposits, mobile wallets, remittance companies, or personal meet-ups with agents.

These online scams promise too-good-to-be-true monthly returns of 10% to as high as 200%. Most of them operate on a pyramiding or Ponzi scheme in which the uplines are paid with funds collected from new recruits.

According to the Bangko Sentral ng Pilipinas (BSP), investing in cryptocurrencies is highly risky and speculative (3), which could lead to huge losses. Unlike stocks, virtual currencies aren’t backed by any company, goods, or services. Some news reports quote BSP Governor Nestor Espenilla Jr. as saying that the central bank was not endorsing cryptocurrencies as investments. Rather, their use is allowed only in remittance.

4. Paid-to-Click Programs

Beware of online advertising companies that offer a money-making opportunity through paid-to-click (PTC) programs. A PTC program’s concept is simple—to get paid, you click on online ads, get referrals, or log in daily.

Sounds easy, but of course, you’ll have to shell out money either by paying a membership fee or purchasing advertising products such as ad packs and clicking accounts. In return, you’re offered a share of the program’s profits.

Recruiters promise huge returns—to the tune of millions of pesos—with only a minimal investment of a few hundred pesos. However, losing money is just as quick as earning it.

Rather than selling real products or services, online advertising firms make money from the upfront payments of their members. Working like a Ponzi scheme, this scam pays fake profits to earlier investors coming from funds paid by new investors.

5. Offshore Stock Trading Scams

Planning to invest your US Dollars? Be vigilant about online investment scams that offer huge returns for minimal dollar investment. Scammers make victims send money for stock investing in another country. Often operating via social media, they recruit investors and make them register for an online account to start the offshore investment activities.

Companies that engage in such an investment scheme aren’t authorized to operate in the Philippines. They also entice investors with high ROIs in as quick as 15 days.

How to Avoid Online Investment Scams

Before you invest, fully understand where you’ll put your money into. Visit the Securities and Exchange Commission (SEC) website (4) to verify if a company is registered and authorized to run its investment activities in the Philippines. If the company's name is not included in the SEC's list, then it's most likely an online scammer. You may also check the SEC advisories on online investment scams (5).

Report any suspicious company by calling SEC at (02) 8818-6337 / 8818-6047 or by sending an email to

Final Thoughts

Trust your gut when it comes to the risk of being scammed. Anything too good to be true and doesn’t involve any hard work should be treated with a grain of salt. As awful as these online scams are, having the presence of mind to double-check whether everything is legitimate is the key to avoiding them.

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Venus has almost 20 years of combined experience in content marketing, SEO, corporate communications, and public relations. Most of her career was spent creating informative articles on personal finance and digital marketing. She also invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. Venus graduated cum laude with a Journalism degree from the University of the Philippines Diliman. A hardcore Hallyu Tita, she loves bingeing Korean shows on Netflix while bonding with her cats. Follow Venus on LinkedIn.


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