,

PayPal: red alert for businesses as sophisticated scams fool users

3-minute read

Shop owner using a laptop
Monkey Business/stock.adobe.com

Small businesses that use PayPal need to be vigilant of increasingly sophisticated scams targeting their finances.

Cyber attacks on PayPal users have increased by 600 per cent so far this year, according to MacAfee Labs. 

The most common type of attack is a PayPal scam email, asking users to update their details or phone a fraudulent number. 

What are the PayPal scams small businesses need to be aware of?

One type of new sophisticated PayPal scam is when fraudsters use the platform to send fake invoices or purchase confirmations from [email protected].

The scam emails usually ask unsuspecting users to call a number – they’ll then be speaking to the fraudster instead of PayPal. This puts them at risk of passing over important account information, which could allow the scammer to access their funds.

According to reports, there’s also been a surge in ‘action required’ PayPal email scams. 

These communications tell account holders that they need to update their details within 24 or 48 hours or face suspension. Users who click the email are then sent to a fraudulent site where they’re prompted to share their password, allowing fraudsters to access their account.

Other types of common PayPal scams include:

  • invoice and money requests – receiving a request for money for something you haven’t bought
  • overpayments – a customer overpaying for an order and then asking you to refund the difference
  • prize winnings or advance fees – asking you to pay a fee for something upfront, such as a prize draw

PayPal has a full list of common scams and what to look out for on their website.

How to avoid a PayPal scam

As scams become more sophisticated, it can be more difficult to identify them. Here are five steps you can take to reduce your chances of being the victim of a PayPal scam:

  1. Turn on two-factor authentication – this gives you an extra layer of security, making it harder for scammers to access your account
  2. Don’t call phone numbers in emails – PayPal won’t ask you to call them to update your details
  3. Scrutinise web addresses and email senders – if an email isn’t from an official PayPal address, it’s highly likely to be a scam
  4. Be cautious of email communications from PayPal – even emails from official PayPal addresses could be a scam. Check the messaging thoroughly and be extra cautious if something doesn’t feel right
  5. Be wary of urgency or threat messaging – emails that ask you to update details in a short time window or threaten account suspension could be a PayPal scam

PayPal asks its account holders to forward suspicious emails to [email protected] and then delete the email.

Ready to set up your cover?

As one of the UK’s biggest business insurance providers, we specialise in public liability insurance and protect more trades than anybody else. Why not take a look now and build a quick, tailored quote?

Start your quote

Written by

Conor Shilling

Conor Shilling is a professional writer with over 10 years’ experience across the property, small business, and insurance sectors. A trained journalist, Conor’s previous experience includes writing for several leading online property trade publications. Conor has worked at Simply Business as a Copywriter for three years, specialising in the buy-to-let market, landlords, and small business finance. Connect with Conor on LinkedIn.

This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry-specific professionals who may better understand your business’s needs. Read our full disclaimer