Online scams are as old as the internet, and people keep falling for the same old techniques. But with the global semiconductor shortage raging on and making hardware difficult to find, scammers have found a new lease of life among desperate buyers.
What Is the Global Chip Supply Shortage?
In case you hadn’t realized, there’s a global shortage of computer chips currently causing problems for manufacturers. Since so many items now use semiconductors, this has affected everything from games consoles and graphics cards, to cars, toasters, and washing machines.
This has been caused by a perfect storm of factors, with the COVID-19 global pandemic taking much of the blame. Lockdowns saw production grind to a halt as fabrication plants were shut down to stem a rise in infections. These plants are now working to clear the backlog of orders that continued to accumulate while they were dormant.
But the pandemic isn’t the only factor. A trade war between China and the United States which saw restrictions imposed on Chinese producers placed increased strain on manufacturers like Taiwan Semiconductor Manufacturing Company (TSMC) which makes chips for Apple, NVIDIA, and AMD and accounts for around 54% of global chip production.
Taiwan also saw its worst drought in 50 years, which is a problem when your semiconductor manufacturers use a huge amount of water a day. Severe weather in US manufacturing facilities and fires in Japanese factories placed further strain on the supply. The result is a chip shortage that, at the time of writing in December 2021, shows no sign of letting up any time soon.
The fact that the pandemic led to a huge number of people working from home didn’t help either. Many people realized their home computers were slow and needed an update. Others rushed out to buy a home multi-monitor setup and new webcams to stop them looking like corpses on video calls. All the services that flourished during this time (like Zoom and Slack) also needed to account for the increased capacity, further putting pressure on the supply of new silicon.
Buyers Are Desperate for Stock
As a result of the shortages, demand for hardware increased. Processors (CPUs), graphics cards (GPUs), and games consoles like the PlayStation 5 and Xbox Series X are among the most sought after consumer items, but even webcams and other peripherals took a hit. This has led to a spike in scalpers charging exorbitant fees on websites like eBay.
Unfortunately, buyers are desperate. This means that some are willing to pay ridiculous prices for graphics cards that are years old, because in the current market any graphics card is better than no graphics card at all. The latest cards like the NVIDIA 30-series command a premium, with many retailers resorting to lottery systems rather than first-come first-served.
This fear of missing out has created an environment where desperate buyers will react quickly to news of new stock, whether it’s gaming hardware or a console. This can lead to hasty purchases where the buyer may not do their due diligence before entering card details and parting with their money.
Scammers Prey on FOMO
Stock for new graphics cards and consoles depletes in minutes, which means buyers will scramble to get to the checkout as quickly as possible. Scammers know this, and they’re using one of the oldest tricks in the book to take advantage of it: the email scam.
It’s the same scam you’ve likely been warned about before, and one you probably think you’re immune to. Scammers send emails that look official pretending to be a large retailer like Best Buy. They advertise that limited stocks of graphics cards or consoles have just been made available, with a link to purchase.
On visiting the link the website looks legitimate, and the retailer is of course selling these items at MSRP rather than the inflated prices you see on reseller websites. This makes the opportunity all the more alluring. Before long you’ve made it all the way through the checkout process and burned a new hole in your wallet. But it was worth it to beat the scalpers, right?
The chip shortage has made for a fast scam. These emails may not be flagged as suspicious and may just make it to enough inboxes to be profitable. But you won’t get your item, and depending on what you used to complete the transaction you might not get your money back either.
At best you’ll be disappointed. You might pass up legitimate offers to secure items in the interim, before you realize you’ve been scammed. At worst you lose a lot of money and learn an expensive lesson.
How to Avoid Getting Scammed
It’s easy to tell someone who’s fallen for such a scam that they should have checked the email more thoroughly. Clicking around the website they landed on before parting with their cash might have raised a red flag. But much of the time these emails and websites look and behave just like the real deal.
The environment created by the chip shortage also provides sufficient distraction. Rather than wondering if you’re about to fall for a scam, you might be wondering if you’ll manage to make it to the checkout before everyone else who received the email.
The one thing we’d recommend doing if you receive such an email (or a text message, or even a phone call) is to visit the retailer’s website directly. Find the item that’s being advertised there for yourself. If they have stock, the item will be listed for sale and you can complete the purchase with peace of mind.
You can always look at the URL bar in your browser to see if the website you have landed on belongs to the retailer in question, but scammers often use convincing namesakes that can appear legitimate. Not everyone is going to be able to spot the scam this way.
Scalpers May Scam You Too
It’s not just email scammers who are taking advantage of the chip shortage. The practice of scalping is already morally dubious, but some “resellers” don’t actually have stock of the item they are selling. These people know that buyers are desperate, and they will use the usual techniques to try and make a quick buck.
If you are trying to buy a second-hand graphics card or console, we’d urge taking extreme caution if doing so in person. If possible, use online auctions like eBay since PayPal transactions offer buyer protection which means you’ll get your money back if the goods aren’t as advertised.
Buying in-person is much trickier, since you’ll ideally want to see the item in working order before you hand any money over. Carrying large amounts of cash around may just paint a target on your back, so consider using a peer-to-peer payment app like Venmo or Cash App instead (make sure you negotiate this with the seller beforehand).
As the Shortage Drags On, So Do The Scams
As demand continues to soar, expect scammers and scalpers (and scamming scalpers) to continue their grift. Stay vigilant and make sure you’re confident that you’re buying from a legitimate source whenever you receive a notification that new stock has arrived.
The last few years have seen a rise in this type of unsavory online activity. Some notable examples include Facebook scams, text message scams, unsolicited robocallers, and a rise in spam on services like Signal.
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