Affiliate Marketing ScamsBe On the Lookout for These 10 Affiliate Marketing Scams

August 2, 2023 | 22 min read

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Affiliate Marketing Scams Affiliate Fraud

In a Nutshell

Affiliate marketing scams are serious business. Today, we’re going to look at the top 10 affiliate marketing scams to be on the lookout for and examine their impact on merchants. We’ll also offer some tips as to how you can prevent them from happening.

How to Spot and Stop Affiliate Scams From Busting Your Marketing Budget

Affiliate marketing has become a very popular approach to digital commerce, particularly with newcomers and emerging brands. The appeal is obvious; it requires minimal initial investment, with the potential for substantial sales generated by affiliate partners.

Unfortunately, fraudsters can exploit loopholes in the system and take advantage of sellers. This is a practice known as affiliate fraud.

Learn more about affiliate fraud

Statistics indicate there’s been a significant surge in global digital ad fraud losses in recent years. We anticipate an increase from $35 billion in losses in 2018 to a staggering $100 billion by 2024. This emerging threat seems to cast a long shadow over the future of the affiliate marketing industry, potentially putting the entire field in jeopardy.

Affiliate Marketing: at a Glance

First, let’s start by clarifying what we’re talking about here.

Affiliate marketing is a results-oriented marketing strategy. Individuals, referred to as affiliates, are compensated for promoting a company's products or services. The role of these affiliates is to endorse the advertiser’s (i.e. the merchant's) offerings to their audience, earning a commission for every sale that they facilitate.

The customer, having been influenced by the affiliate's promotion, purchases the product via the affiliate's unique referral link. Thus, commissions earned by affiliates hinge on the real sales produced by their efforts. 

Affiliate marketing is a legitimate way for businesses to promote their products or services online. As we’ll see, though, there are a number of affiliate marketing scams in which bad actors can engage to steal unearned commissions.

In short, an affiliate marketing scam is any scenario in which a person aims to trick an advertiser into paying a commission on a conversion that never took place. 

How Affiliate Scams Hurt Advertisers

Affiliate marketing scams are a hard-to-identify but devastating source of revenue loss for merchants. It can render entire campaigns unreliable, destabilize markets, and cost banks, consumers, and merchants piles of money.

Some of the most immediate consequences of affiliate marketing scams include:

Irregular Ad Spending

Affiliate fraud can devastate marketing budgets and relationships. Fraudsters count on many advertisers and their partners using pay-per-click (PPC) ads that can be manipulated to register fake clicks. Each fraudulent click wastes a portion of your total ad budget.

Inorganic Traffic

With manipulated data comes inaccurate traffic analysis. Advertisers can’t tell the difference between human users and bots without the ability to gather in-depth analytic data. This means any reporting would reflect faulty numbers rather than actual traffic, leading to less effective campaigns in the future.

Faulty Decisioning

Skewed data and traffic analytics make it very difficult to know what ads are — and are not — working. It's also hard to tell how best to approach that data and how your business can learn and grow from that information.

Damaged Partnerships

Becoming the victim of an affiliate scam could also cause conflict between you and your partners. Even worse, a permanent loss of customer faith and trust. If you gain a reputation as being susceptible to scams and fraud, the impact on your business could be severe.

The Top 10 Most Common Affiliate Marketing Scams (& What to Do About Them)

So, now that we have a better understanding of the threat that affiliate marketing scams pose, let’s talk about the many ways you might be targeted.

Here are the top ten affiliate marketing scams you need to watch out for, and what you can do to prevent each threat:

#1 Fake Leads

Fake lead fraud is an affiliate scam in which fraudsters send fake leads to an advertiser to defraud the company for a commission.

This scam relies on synthetic identities and bot traffic to convince companies that the leads they pay for are genuine and actionable. However, all the leads generated are fake, useless junk that can’t be converted to a sale.

Red Flag: High Lead Volume

A sudden and significant increase in the number of leads without a corresponding increase in sales or engagement is a red flag. This could be a sign that someone is generating fake leads.

How to Avoid

Monitor Lead Traffic: Keep an eye on the number of leads you receive and try to keep track of their sources. If you see any sudden or suspicious changes, investigate further.

Red Flag: Low Engagement

Leads aren’t engaging with the product or service meaningfully. For example, if they don't make any purchases, don't sign up for any newsletters, or don't interact with the website or app, it's possible that they are not real people.

How to Avoid

Deploy Fraud Tools: Several fraud detection tools are available to help you identify fake leads. These tools can analyze your referral traffic and identify patterns that are indicative of fraud.

Red Flag: Unknown or questionable referral sources

The source of the leads is unknown or questionable. For example, they may be fabricated if leads come from spam emails, social media bots, or other suspicious sources.

How to Avoid

Vet Your Partners: Reputable affiliate networks have measures in place to protect their advertisers from fraud. When you work with a reputable affiliate network, you'll be less likely to be targeted by scammers.

Also known as “cookie dropping,” cookie stuffing is an affiliate scam through which a fraudster uses web cookies to collect affiliate commissions on goods they did not sell.

Consumers must click through from the affiliate’s site to the advertiser’s site and make a purchase to legitimize a commission. With cookie stuffing, though, the advertiser pays a commission, even though the fraudster didn’t earn it. The fraudulent cookie might even override another cookie placed by a legitimate affiliate, meaning they don’t get the commission they earned.

Red Flag: Unusual Traffic Spikes:

A sudden spike in traffic to your website or a specific page. This is because fraudsters often use automated tools to generate clicks on affiliate links, which can lead to a sudden spike in traffic.

How to Avoid

Monitor Traffic Spikes: Unusually high traffic could be a sign that someone is using bots or other automated tools to generate clicks on your affiliate links.

Red Flag: High Bounce Rates

Many visitors to your website leave immediately without taking any action. This happens because fraudsters aren’t interested in engaging with your website or product. They’re just generating as many clicks on affiliate links as possible.

How to Avoid

Monitor Bounce Rates: If a large percentage of visitors to your website leave immediately after clicking on an affiliate link, this could be a sign that the traffic is fraudulent.

Red Flag: Unusual Affiliate Behavior:

An affiliate suddenly generates many clicks without any corresponding sales or engagement. This behavior is often automated and doesn't reflect genuine user interest.

How to Avoid

Check Affiliate References: You can check for reviews of affiliates online or ask for recommendations from other businesses.

#3 Click Fraud

Click fraud, or “click flooding,” is an affiliate scam that uses mobile apps or websites to generate fake clicks.

Fraudulent clicks fall into two categories: manual and automated. The former involves human beings clicking a link, while automatic click fraud employs automated tools to work on a larger scale. It can work by generating non-human (i.e., bot) traffic through malware-infected mobile devices. Or, you can have click farms in which humans manually engage with ad links.

Click fraud wastes advertisers’ money and distorts targeting data. It also drives up online advertising costs, causing ongoing damage to the industry.

Red Flag: Suspicious Behavior

Look for users who consistently click on ads or fill out forms but never make a purchase. This could be a sign that the user is not a real person but a bot or automated tool.

How to Avoid

Use Dynamic Affiliate Links: Dynamic affiliate links make it more difficult for fraudsters to generate fraudulent clicks. This is because each click generates a unique link, which makes it harder for fraudsters to automate the process of generating clicks.

Red Flag: High Clicks, Low Conversions

A high number of clicks on your ads with low conversion rates. This is because fraudsters often use bots or other automated tools to generate clicks but aren’t interested in actually making a purchase.

How to Avoid

Use Geotargeting: Geotargeting allows you to target your ads to specific geographic locations. This can help you reduce the risk of click fraud in countries where these scams are more common.

Red Flag: Inconsistent Activity

A sudden surge in clicks or a high number of form submissions in a short period. This is because fraudsters often use bots or other automated tools to generate clicks in bursts.

How to Avoid

Use CAPTCHA Puzzles: A CAPTCHA is a challenge-response test that is used to verify that the user is a human. This can help to prevent bots from generating fraudulent clicks.

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#4 Transaction Fraud

Transaction fraud happens when a fraudster uses stolen credit card or other payment account information to process a transaction from another user’s account. This may also branch out into transaction laundering.

When an advertiser is targeted by this affiliate marketing scam, they wind up paying for more than just the initial attack. First, they lose the original transaction value. They then lose any commission paid to the affiliate scammer and, eventually, the chargeback fees they will fork over when the account holder files a chargeback.

Red Flag: Unusual Purchase Patterns

A customer makes a large purchase that is out of character for them. For example, if a customer who has never bought anything more expensive than $50 suddenly buys a $1,000 item.

How to Avoid

Score Transactions: Fraud scoring involves the use of an AI machine learning tool to rate the overall fraud risk of incoming transactions. This technology examines each transaction based on dozens of different indicators, then assigns a simple numeric score representing the transaction's risk level.

Red Flag: Multiple Failed Transactions

A customer attempts to make a purchase and their credit card is declined multiple times.

How to Avoid

Deploy Whitelists & Blacklists Even with machine learning, it would be impossible to spot and stop every act of transaction fraud. However, by establishing rules that assign a risk level to certain transaction types, you can segment accounts accordingly.

Red Flag: High-Risk IP Address

The buyer’s IP address suggests they’re located in a country that is known for high levels of fraud.

How to Avoid

Require Manual Review: Even with all the fraud detection and prevention tools on the market, you can never fully count on one tool to stop everything. This is why having a protocol in place for manual review of questionable transactions is crucial. Manual review can also help recover sales that might’ve been flagged as a false decline

#5 Fake Products

A fake product scam occurs when a fraudster creates an ad or webpage for a product or service that doesn’t actually exist. They then promote that product under a legitimate company’s branding and credentials.

This is a prevalent form of affiliate fraud because it is so easy for scammers to take advantage of customers’ scrolling habits through social media. Indeed, Facebook Marketplace contains a veritable hive of fake product scams that led to over $117 million in losses in the first half of 2020.

Fake products are such a problem that the FBI received almost 50,000 complaints and reported $3.5 billion in losses last year alone.

Red Flag: Suspicious Pricing

If a product is sold for a price significantly lower than the market price, it is likely fake.

How to Avoid

Register Trademarks: Ensure your brand and trademarks are officially registered with the appropriate bodies to thwart unlawful use.

Red Flag: Poor Quality Packaging

Fake products often have poor quality packaging. The packaging may be poorly printed, the fonts may be incorrect, or the product may not be in the same packaging as the genuine product.

How to Avoid

Boost Website Security: Enhance your website's safety by implementing SSL encryption, consistently updating your software, and adopting robust passwords.

Red Flag: Missing or Incorrect Product Information

Fake products often lack important information, such as the manufacturer's name, the product's serial number, or the product's warranty information.

How to Avoid

Limit Access to Confidential Data: Restrict access to critical data, such as customer details or financial records, strictly to individuals who have the necessary authorization.

#6 URL Hijacking

URL hijacking (or “typosquatting”) happens when a fraudster buys a URL similar to a legitimate retailer’s. The fraudster then redirects traffic to the fake website to claim affiliate commissions. The hacker will insert affiliate links and data into their redirect process, though, to profit from that exchange.

For example, if you misspell a letter or phrase in a legitimate company’s URL, you may be redirected to the fraudster’s site without realizing it. The fraudster may even clone the significant details of the original site and use them in various descending scams. For example, hitting the advertiser for an unearned commission while installing malicious software on the buyer’s machine.

A clicked link navigates to an unrelated web page or site that doesn't match the initial link.

How to Avoid

Boost Website Security: Implementing a secure protocol like HTTPS for your website is crucial. This protocol encrypts the data that is being transferred between your website and the user, making it much harder for fraudsters to intercept and reroute your website's traffic.

Red Flag: Spot irregularities

The aesthetic or structure of a website deviates from what is familiar or anticipated.

How to Avoid

Inform Your Audience It's essential to enlighten your audience about the perils of URL hijacking and the signs of counterfeit links. Urge them to stick to links from reliable sources and to always confirm the target URL before clicking on any links.

Red Flag: Be a “Clicker”

Consumers are prompted to click attached links in an unverified communication.

How to Avoid

Monitor Brand Messaging: Keeping a close eye on your brand's communication can prevent any misrepresentation or misuse. Ensuring consistent messaging across all platforms helps your audience identify legitimate information from your brand and distinguish it from potential scams.

#7 Google Ad Hijacking

Fake ad hijacking is a form of affiliate marketing fraud that happens when a fraudster creates a phony ad that appears at the top of a Google search. Consumers will be most likely to assume the ad is legitimate, as they trust Google’s due diligence process.

Once the consumer clicks on the false (and sometimes identical) ad, the hacker can hijack a company’s paid ad space and steal their traffic by targeting branded keywords. If the scam succeeds, consumers will assume they’re visiting a legitimate site and make a purchase, for which the fraudster will claim the affiliate commission.

Red Flag: Unusual Ad Performance

An abrupt or unexpected change in your Google Ad performance. It might be a sudden increase in click-through rates, conversion rates, or cost-per-click without a logical explanation. For instance, a high number of clicks but very low conversions.

How to Avoid

Prioritize Brand Research: Investigate the search engine results page (SERP) for any dubious advertisements that aren't associated with your enterprise or brand.

Red Flag: Discrepancies in Display URLs

You notice ads that resemble yours but with slightly different display URLs. This might mean someone is mimicking your brand to trick users into visiting their site instead.

How to Avoid

Stay Alert: Be on the lookout for advertisements that resemble your company's ads, but which have minor modifications to the URLs or landing pages.

Red Flag: Suspicious Ads in Search Engine Results

You're seeing dubious ads unrelated to your company appearing when you search your brand name. These could be competitors' ads or completely unrelated ones, both of which are using your brand's keywords to divert your potential customers.

How to Avoid

Analyze Your Data: Watch for any unanticipated shifts in performance indicators, like click-through rates, conversion rates, and cost-per-click.

#8 Spoof Traffic

This affiliate marketing scam occurs when spammers send false impressions and invalid click data to advertisers to make it look like they are sending legitimate traffic. Inevitably, the impressions they send will include bots and junk data designed to make them look like credible affiliates.

On the retailer’s end, this spoof data will appear like the false affiliate is sending lots of traffic to their site or service. All those impressions originate with bots or click-farm traffic, though. Spoof traffic scams are widespread in PPC (pay-per-click) affiliate marketing. They let fraudsters make money from the number of clicks they generate rather than tractable funds resulting from the affiliate’s actions.

Red Flag: Irregular Traffic Patterns

Any sudden and unexplainable surge in your website traffic. For example, you notice a massive influx of users at unusual times or from regions that don't typically engage with your website.

How to Avoid

Use Traffic Monitoring Tools: Tools like Google Analytics can help you analyze website traffic, including details like geographic location, time spent on the site, and referral sources. Any unusual patterns can be investigated and flagged. You can also set up alerts for sudden traffic spikes.

Red Flag: High Bounce Rates

A certain level of bounce (or visitors leaving after viewing only one page) is normal. However, bots may be programmed to land on a page and then immediately leave, artificially inflating traffic numbers without real user engagement.

How to Avoid

Implement CAPTCHA: Consider implementing CAPTCHA on forms, checkout pages, or anywhere else where user engagement is critical to ensure that interactions on your site are human. CAPTCHA can help filter out bot traffic, reducing the likelihood of traffic spoofing.

Red Flag: Lack of Conversions

Despite seeing a high volume of traffic, you observe very few conversions, whether it's sales, form submissions, or any other desirable action.

How to Avoid

Regularly Update & Secure Your Site: Regularly updating your software, plugins, and security protocols can help protect against vulnerabilities that might be exploited to generate spoof traffic. This includes using secure protocols like HTTPS and regularly updating and patching your content management system. Additionally, using a reputable security plugin can help identify and block suspicious IP addresses.

#9 “Get Rich Quick” Schemes

You’d think everyone would be wise to this tactic by now. However, there are still many forms of this tried-and-true clickbait scam that tend to catch consumers now and again.

Fraudsters use talking points like saying “this one simple trick can save you thousands” or “click here for the secret to losing 20 pounds in one week.” Others will imply that the promised benefit will magically appear if you click into a video provided by the poster’s “partners” or “sponsors.”

In reality, the consumer will be led down a rabbit hole of descending click-in scams designed to generate fake affiliate clicks for the scammer. Even worse, they can parlay this scam into gaining access to the user’s computer and private data.

Red Flag: High Returns with “No Risk”

A guarantee of high financial returns with no risk. All legitimate investments come with some level of risk, and the potential for high returns often comes with high risk.

How to Avoid

Conduct Thorough Research: Tell buyers to take the time to thoroughly research the company and the offer before committing to any investment or opportunity. Look for reviews, check for any complaints or legal actions against the company, and try to independently verify any claims made.

Red Flag: Vague Business Models

The affiliate marketing scammer doesn't provide clear, understandable information about how the money is made. "Get rich quick" scams often rely on convoluted or secretive business models to confuse potential victims and make the scheme seem more legitimate than it really is. A trustworthy business or investment opportunity should be transparent about how it operates and generates revenue.

How to Avoid

Be Skeptical: As a rule of thumb, high-return investments come with high risks. Users should be extremely wary of any offer that guarantees large profits with little to no risk. If it sounds too good to be true, it probably is.

Red Flag: “Act Quickly” Pressure

Scammers often try to create a sense of urgency, telling customers they must act now to take advantage of the opportunity. This pressure tactic is designed to prevent people from taking the time to research and think carefully about the decision.

How to Avoid

Avoid Pressure Tactics: Scammers often create a sense of urgency to prevent you from doing your due diligence. Always take your time to consider the opportunity, and don't let anyone rush you into making a decision. Legitimate businesses or investment opportunities will not push you to make immediate decisions.

#10 “Pay to Play”

Lastly, pay-to-join scams are another form of affiliate fraud that asks retailers to pay for memberships with various agencies. The scam is relatively easy to commit, as it might seem rational that you should pay to join an affiliate program.

The fact is that most credible affiliate programs do not feature sign-up fees or up-front membership costs. As the name implies, performance marketing should be based on performance. If a network has faith in their affiliates, they shouldn’t require a big, up-front investment to start using their service.

Red Flag: Application Fees

In this affiliate marketing scam, fraudsters post fake listings and ask applicants to pay a fee to apply for a spot, supposedly to cover background checks or other administrative costs.

How to Avoid

Verify Before You Pay: Always independently verify the legitimacy of any listing, a prize announcement, or an investment opportunity before you pay any fees. This could mean doing online research, checking with the Better Business Bureau, or reaching out to known and trusted contacts in the relevant industry.

Red Flag: Prize or Sweepstakes Scams

Here, the scammer tells the victim they've won a prize from the network, but they need to make a payment to "unlock" their winnings or cover taxes or fees.

How to Avoid

Never Make an Upfront Payment: Legitimate affiliate opportunities typically do not require you to pay upfront fees. If you're asked to pay to claim a prize or invest in an opportunity, it's likely a scam.

Red Flag: Pay-to-Play Investment

The victim is offered a chance to participate in an exclusive investment opportunity, but they must pay an upfront fee or "membership" cost.

How to Avoid

Ignore Unsolicited Offers: If you receive an unsolicited offer, especially one that seems too good to be true, be wary. Scammers often use unsolicited emails, calls, or messages to find victims. If you didn't enter a sweepstakes, for example, you shouldn't be receiving a prize.

Adopt Best Practices to Stop Affiliate Marketing Scams

Any of the above affiliate marketing scams can cause an otherwise profitable campaign to collapse into a major source of revenue loss.

That’s not to say you should cut affiliate marketing out of your business plan, though. Maintaining an affiliate marketing relationship can be extremely lucrative… as long as you take proper precautions.

You should periodically review your affiliate program’s terms and conditions. Keeping terms and conditions up-to-date is one way to close loopholes and prevent affiliate fraud. A good attorney can catch exploitable factors that you might miss. Of course, this also relies on you to uphold your terms and ensure that affiliates are compliant.

Also, remember to keep an eye on your KPIs, or key performance indicators. Managing an affiliate program can be difficult because of the opaqueness of the process. Raw data and relevant KPIs are valuable sources of insight. This may include information from referring sites, sub-affiliate networks, IP addresses, and transaction trends. Deviations — even seemingly good ones — suggest something is wrong.

Have additional questions? Want to learn more about keeping your business safe from affiliate marketing scams and other risk factors? Click below and speak with one of our experts today.


What is an example of affiliate fraud?

In one example, if a clicked link navigates to an unrelated webpage or site that doesn't match the initial link, exercise caution because it could be a form of click fraud.

How do you detect affiliate fraud?

There are many ways to detect affiliate fraud, but typically, anything outside of the norm with regard to your brand metrics is something worth investigating. See the above breakdown for a more thorough explanation.

What are the risks of affiliate marketing?

Affiliate marketing scams are a hard-to-identify but devastating source of revenue loss for merchants. It can render entire campaigns unreliable, destabilize markets, and cost banks, consumers, and merchants piles of money.

What are the disadvantages of an affiliate program?

Although affiliate marketing is a legitimate way for businesses to promote their products or services online, scammers can use it to deceive people.

What is affiliate hijacking?

Affiliate hijacking, also known as URL hijacking, is a fraudulent practice within affiliate marketing where a scammer manipulates the process to steal commissions that should rightfully go to another affiliate.

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