ebay Scam Alert; Phony Escrow Services
By Shelley Lockwood
I'm calling it an ebay scam alert because these scam artists target mainly online auctions.
As the trend of online auctions continues to grow in popularity so does the need for online payment options and protection for both sellers & buyers.
Buyers to ensure they get what they're paying for. Sellers to ensure they get paid. Especially with cash transactions.
The answer - Third party unbiased online payment processors. Giving sellers the ability to accept multiple payment methods and sellers more ways to pay.
Online payment services accept payment (from buyers) by credit card or electronic transfer. They then transfer the money to the buyer when the purchase is made.
Internet escrow services protect the buyer and the seller by accepting payment and holding the funds until the goods are delivered. The buyer's money is not handed over until they confirm receipt of goods. Online escrow services are ideal for high price items.
The scam: A seller entices buyers away from the auction item to a lower priced item. They then reassure them of protection by suggesting the use of a third party payment or escrow service. The payment processor is a fake. The money is received and no goods are ever shipped.
A legitimate seller can be taken in by the phony service as well. Shipping the goods but never receiving payment.
At least with a credit card, buyers have some protection for non-delivery of goods. If they pay using their credit card and they don't receive the goods a claim can be made. If all goes well the charge is refunded minus a deductible. Making the claim is a hassle, and depending on the amount charged the deductible could be more than the original charge. It's a good idea to inform yourself about your credit card company's policy.
Using online payment or escrow services is a pretty standard practice on the Internet especially for smaller businesses or individuals. I'm not saying you shouldn't use them. But it's important to research the provider first to understand the terms of protection and recourse they offer and to ensure that they are in fact legitimate.