Roseman: Online scams abound
November 08, 2009
Ellen Roseman
But some buyers are more interested in scamming you than in scoring a great deal.
Alan Munro posted an ad on Craigslist to sell a windsurfer board. He got a quick response from a man who wanted to buy it sight unseen and would send a cheque for the full amount.
"I gave him my name and address to send the cheque and gave him five business days," says Munro, a senior financial adviser at Assante Capital Management in Mississauga.
"The time expired with no cheque, so I emailed him back. He said something got messed up with the cheque. Could I email him an invoice through PayPal?"
He did so and got an email that seemed to come from PayPal, saying that a remittance had been made. But since the invoice was in U.S. dollars, he had to pay the difference before the money was released.
Another email from "PayPal" asked him to send a MoneyGram and a scanned receipt to somewhere in Nigeria.
He contacted the buyer, who urged him to send the money for the exchange difference. He desperately wanted to buy the windsurfer board.
Things started to fall apart after that. When checking his PayPal account, Munro saw an invoice had gone out but no remittance had been made. He asked the buyer, who had not supplied a phone number, to call him.
"It was a long distance call that was interrupted with bad reception. I also asked him where he was located. He paused for a while and finally said the U.K.
Then the phone died."
Munro realized he was dealing with a scammer, who showed all the classic warning signs.
Craigslist has one simple rule that, if followed, can help you avoid 99 per cent of all scam attempts.
"Deal locally with folks you can meet in person," says Susan MacTavish Best, a spokeswoman for the classified advertising service.
"Rule Number 2 for avoiding scams is: Never wire funds via Western Union, MoneyGram or any other wire service. Anyone who asks you to do so is a scammer."
Buying something over the Internet presents a problem when the buyer and seller don't know each other.
Some sellers fall for promises from buyers about using a third-party secure service or escrow service, which protects them when making transactions. The vast majority are fraudulent.
Kijiji, another popular website for selling household goods, warns that any emails or websites that talk about secure payment systems are scams, even if they have the Kijiji logo.
Craigslist has similar warnings about escrow services, which also purport to be secure.
To avoid fraud, says Kijiji, ensure that all transactions take place locally and in person. Go to a public place with many people around, such as a coffee shop.
Remember that ads are not reviewed before they are posted on the website. Never send or wire money to buyers, which includes mailing cheques or using payment services such as PayPal, BidPay, Western Union or MoneyGram.
As for Munro, he now believes in dealing with local people you can meet face to face.
"I finally sold the windsurfer to a young fellow from Oakville. I had to give him a discount, but it was well worth it," he says.
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