Word of the Week: Scam

Word of the Week: Scam
Other words for Scam: Swindle, Con, Fraud, Bunco, Diddle, FlimFlam, Gyp, Racket, Sting, Hustle

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Fake Check Scam - Fake Check in the Mail

1 Easy Tip to Avoid Receiving a Bad Check The era of the fake check scam is not past and gone, as it still claims victims. My own recent e...

Online Merchants Seller Protection

Several years ago I decided to take on the adventure of selling collectibles online through my first website. I must say it has been a learning experience, and especially for online fraud. I'm a very cautious person and have had my fair share of individuals attempting to make fraudulent purchases through my website.

Realizing I had not shared that information here I thought this may be helpful to someone who may be considering online sales of merchandise. Like most other online entrepreneurs I've also sold merchandise through ebay, but the focus of this article is in regards to online sales outside of an auction site.

Once I established my online store I secured the ability as a merchant to offer Visa and Mastercard to my customers, which I added to the option for them to use PayPal. Unfortunately the very first prospect I had attempting to make a purchase using a Mastercard was attempting to commit fraud! That was discouraging to say the least, and I'm sure the big retailers online are faced with the same challenge all the time.

In this first example, you'll learn some red flags which came up as a result of the person using a stolen credit card:

1. In the online order form the person entered an address, which was a US address, yet they selected a different country for the merchandise to be delivered, and provided a phone number from a foreign country. This red flag therefore indicated the shipping address would be different from their credit card billing address.

2. The person's email address was from Yahoo. This is not to say that every person who uses a free email service is a con artist or attempting to commit fraud, but it is something to watch for.

I then decided to send the person an email. In my email I questioned the individual in regards to where they wanted the merchandise shipped since they selected a foreign country yet entered a US address. I also informed the person that our online store policy only provided the ability to ship to US customers. That's when the additional red flags came up and I knew my suspicions of fraud were accurate. What were the additional red flags?

1. The person refused to accept the fact that we would not ship outside of the US, but instead became very demanding.

2. The individual then stated they wanted me to charge the Mastercard and then wire them the money from the charge. OK, this was an obvious red flag.

3. They went as far as providing a Mastercard number through the email! Not a good sign! Merchants normally do not even view a Visa or Mastercard number through an online purchase since it's encrypted. This individual obviously was not concerned about revealing a credit card number through email!

Those were easy red flags making it obvious the person was attempting fraud and warranted a phone call to the credit card merchant support line. That enabled me to report the persons fraud attempt, which alerted the card holders bank that their customers card had been compromised.

Moving onto this next example, you'll learn some red flags to watch for when a person is attempting to use a PayPal account that is not their own or attempting to use one fraudulently. I've had numerous experiences from individuals attempting to make a fraudulent purchase using PayPal. Here's what to watch for:

1. Only accept purchases through PayPal that offer you the PayPal Sellers Protection program. If the individual is not a verified buyer through PayPal you cannot be offered the protection as a seller, so watch this carefully.

2. Be cautious if they provide a billing or shipping address on their order form, which differs from their PayPal address shown in their PayPal account.

3. The name in the persons email address does not match the name on their PayPal account. Although in one case I had the person had the same last name, the first name was not a match. This could be an indication of someone like a son or daughter attempting to use a parents PayPal account without permission, or possibly a red flag for fraudulent use.

In summary, a merchant simply needs to have all their ducks in a row with what they must watch for. Never be so excited about a potential purchase from a prospect and attempt to process the order too quickly - that's when you'll overlook the red flags!

Take the time you need as the merchant to ensure you will only be shipping your merchandise once you have completely ruled out online fraud. Don't hesitate to contact PayPal or the merchant credit card service you use if you suspect fraud! You may be the first merchant to help save someone from having their credit card or PayPal account compromised further.

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