Shopify Fake Websites

Shopify is a Canadian e-commerce company. It is also the name of its e-commerce platform for online stores and retail point-of-sale systems.

Shopify is used by over 600,000 businesses worldwide and is very easy to use and cheap so anyone, including scammers, can quickly setup an online shop.

But Shopify is attractive to scammers. e.g. My Pillow, which makes pillows, sheets and mattresses noticed that an unidentified scammer had used Shopify tools to set up a copy of mypillow.com called mypillowstore.com, which claimed to sell My Pillow products. My Pillow sued Shopify, alleging it supported trademark infringement. Shopify took down the site, but My Pillow demanded damages plus any money Shopify made running the bogus store.

Shopify says it has a team focused on identifying and taking down sites like the fake pillow store.

It’s very simple for a criminal to set up a fake online shop using Shopify software. Designing a store and uploading products is a very quick process and the payments and order processing are all handled by Shopify.

The Triangulation Scheme (exposed by Paul Bjerke of LexisNexis Risk Solutions.)

Scammers use Shopify or a similar service to quickly create sites selling mainstream products such as vacuum cleaners, then the fraudsters use details from previously stolen credit cards to buy the item from a real retail website and have it shipped to shoppers’ homes. Later on, the card payment networks reject the stolen credit card transaction and the real retailer gets what’s known as a chargeback, leaving it with no money for the product it sold. But the scammer still has the original consumers’ money, Bjerke explained.

Shopify say that market forces will weed out merchants using unsavoury tactics but that doesn’t help good companies such as MyPillow from being exploited by the scammers.

Shopify claims it has increased the team focused on merchant misbehaviour and responds to clear cases of copyright and trademark infringement. The company has also modified its software to highlight possible fraud and help shoppers and brands flag improprieties.

But there is a better answer. Rival BigCommerce says it stops fraudsters from starting to use its service. New merchants must pay upfront and prove they have real inventory before they can start selling.

“On other platforms, you can sign up for a free trial and you’re ready to go without paying effectively,” says the company’s chief product officer, Jimmy Duval. “Our approach provides a natural barrier for fraudsters.”

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