The first rule of shopping online is "be safe". The second rule is "trust no one," and this is where most of us get caught. Make sure you don't get conned by the promise of riches, dressed up in a secure postal service and fake escrow website.
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Shopping online has risks – this much is clear from the name – so it is important that you are aware of as many of the different scams pulled by criminals and fraudsters around the world desperate to intercept your funds or your goods.
One of the most popular places for them to operate is via eBay, the popular online auction site in which people regularly buy and sell items as wide ranging as classic cigarette ads and bottles of air from Africa. Somewhere in between you will find the more desirable, high-price label items, and it is often these that the scammers target.
The problem with a good scam is that it is hard to spot. There are various ways in which an online scam might polish itself up to look respectable and divert attention away from the underlying criminal intent. One is to make use of a well-known name; this might be an alleged celebrity endorsement, or the use of a well-known service such as the USPS or other courier services common in eBay scams, particularly those that claim to be using escrow to handle the transfer of funds.
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How the Scam Works
At heart, it is a classic bait and switch.
For instance, you might be selling a particular item on eBay that is small and valuable and you’re getting towards the end of the auction without much in the way of bids.
All of a sudden, you receive a note via eBay’s messaging system from an interested buyer who would like to purchase the item for a nice round figure, just as long as you close the eBay auction and deal directly with the buyer. Obviously this sounds attractive; such as obviously, they’re aware that you might think that the whole thing is mighty suspicious, and suggest how you might conduct the transaction using a recognized courier service such as Western Union or USPS to handle transport of the item while they deposit the funds in an escrow account.
Once the item is received, you will have notice from the courier and be able to confirm this with the escrow company, who will then release the funds to you.
What could go wrong?
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What Is Escrow?
Before we go any further, a quick note on escrow; this isn’t something that you should usually be suspicious of. In the case of this scam, the escrow company that is used is typically described as “approved", but in actual fact the only place where you will find a list of approved escrow services for use with eBay is on their pages, where they list www.escrow.com as the only service that should be used.
Escrow is basically a way of lodging funds in a transaction, a bit like a bank. If you were to purchase a small piece of jeweler from me via a web-based transaction, you might insist on depositing the money with an escrow service, where the funds would wait until you had received the goods. With conformation of receipt the money would then be released to the seller, and the transaction would be closed.
There are many web-based escrow services. The reason that eBay recommends the use of one is that it is very simple for a scam artist to create a fake website purporting to be an escrow service when in fact it is little more than a basic, static web page.
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Realizing You’ve Been Had
By accepting the proposition of the alleged buyer – the scammer – to conduct the transaction outside of eBay, you probably feel that this is a great way to finally sell the item and make a bit of cash on it.
Unfortunately, the only sound of money that you are likely to hear is the tinkle of a single coin when the penny finally drops.
Sadly, far too many people have been taken in by scams such as this over the years. To enjoy safe shopping online it is imperative that you are able to spot scams before they are able to take advantage of you.
In this case, alarm bells should have been ringing when the scammer suggested you carry out the transaction beyond eBay. The online auction service features various tools for protecting sellers and buyers, thereby providing a safe place to do business.
While the use of a well-known courier adds a layer of quality to the scam, the suggestion of using an escrow service is the point at which the scammer knows that he or she has you reeled in. Most people cannot tell a fake website from a genuine one, so by cleverly talking you into using their own fake escrow website, the scammer can easily update the site to display their funds as being lodged.
If you still haven’t realized the scam, however, it will become all too clear in just a few days’ time when it becomes apparent that you have just sent a piece of valuable jewelry on an expensive one-way trip overseas to an address that you will never be able to check out in person.
Basically, you’ve been had.
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Avoiding Scams on Ebay
Like any online scam, this one appeals to the greedier side of human nature. There are several things that you can do to avoid scams on eBay.
Don’t respond to internal messages without checking the history and reputation of the potential buyer.
Don’t end an auction early to then carry out the sale outside of eBay – only do this to deal with an offline buyer who you have already come to an agreement on the auction site.
When listing items on eBay, you can limit your item to particular territories.
Learn how to recognize fake or spoof websites.
Ultimately, in a situation such as this, don’t rush into a sale – take your time, listen to the offer and then make a judgment based on your gut feeling rather than dreams of some extra cash.