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NEW YORK (MainStreet) — As consumers spend more time making purchases online or through their mobile phones during the busiest holiday shopping season of the year, security experts warn shoppers to be prepared for fraud.

Cyber criminals are getting smarter and more creative and are focused even more on phishing via email or texts. Phishing occurs when the fraudsters are able to access your personal and financial information by tricking the user to click on a link or download an attachment. Most of the criminals bait people by creating a sense of urgency and action on the part of the recipient, said Gary McAlum, the chief security officer at USAA, an insurance and financial services company.

"The most pervasive problem that is affecting online users is the problem of phishing," he said.

Users can be a victim via their laptop, tablets or even smartphones, said McAlum.

"Cyber criminals are really good at creating a product that is very legitimate and it creates a sense of interest on your part," he said. "They are con artists and fraudsters. It happens every day."

Online identity theft is a growing crime and increased by 300% between 2010 to 2012, according to Experian. The median amount of credit card fraud is $399, said the U.S. Department of Justice.

Consumers can prevent fraud from occurring by making sure their antivirus software is updated frequently, said McAlum.

"It starts with the right mindset," he said. "Be prudent about what you do. Protect your personal and financial information like it is gold because it is. Use common sense and be a little more vigilante."

PayPal, the e-commerce company which allows consumers to make payments securely, expects $20 billion in mobile volume thus year. The number of people making purchases on their mobile devices has grown steadily over the years – up 190% percent last year and 516% in 2011.

Research reveals millennials and Hispanics are savvy mobile shoppers since 37% of 18- to 24-year-olds and 40% of the Hispanic market are either somewhat or very likely to participate in mobile showrooming, according to a report by BiTE Interactive, the mobile application specialist for Fortune 1000 brands. This is where shoppers go into brick and mortar stores to browse items, but then use mobile apps to compare prices, find the best deal and ultimately make a purchase.

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As consumers become increasingly comfortable with mobile technology, this trend is expected to rise. Consumers rate PayPal above Visa and MasterCard for privacy protection, according to Javelin Research.

"Shoppers are using technology more than ever to do research, compare prices and shop and make purchases from their mobile phone," said Stacy General, customer experience advocate for PayPal.

Consumers are looking for easier ways to shop and 89% say they view waiting in line as a negative experience, she said. Now PayPal's app allows shoppers to order items ahead of time at retailers such as Jamba Juice and Best Buy.

Despite an increasing appetite for mobile services, U.S. consumers remain reluctant to embrace mobile payments, compared to their peers in emerging market countries. Nearly one-third of U.S. survey respondents will increase their mobile payment activity when they have more confidence in mobile security, according to a SAP survey of over 12,000 adults in 17 countries. Just 38% of U.S. respondents said they used their mobile phones for activities other than just making calls or texting. Overall, 63% of global users reported conducting activities beyond talk and text.

The U.S. study also showed that 53% of consumers believe that mobile payments will become more important in the future or plan to use mobile payments in the future.

Since mobile shopping can be more convenient, consumers need to be cautious how they make purchases, said Josh Alexander, co-founder and CEO of Toopher, an Austin, Texas-based company with an invisible, location-based multifactor authentication and authorization software tool that works with your smartphone.

Consumers should avoid storing their credit card information on their phone and should never reuse passwords across online merchants, he said.

Shoppers should use an additional way to identify themselves, such as adding software like Toopher to your account. Consumers should never enter any personal information into a site or app to which they did not navigate.

"Online shopping is often the most convenient way to shop," Alexander said. "That convenience comes at a price - online accounts secured only with a password are ripe for fraudster take over."

--Written by Ellen Chang for MainStreet