On the Watch for Buyer Scams

Recently you may have noticed an new type of "buyer" scam that, though it comes in several variations, can be summarized thus: A "buyer" wins or purchases one or more eBay items and then informs the seller that they will be sending a money order made out for an amount substantially in excess of the total for the purchases. The buyer then requests that the seller  cash or deposit the money order and then immediately send the balance back to the "buyer" via... you guessed it, Western Union. Some of these "buyers" even instruct the seller to take a 15% "fee for their trouble" which is diabolically ironic since if the seller agrees, their "trouble" has only just begun.

The money orders are of course, bogus, but many banks will cash them if the seller has a deposit account with the bank. Days or weeks later, after the seller has sent the balance back to the "buyer," the bank will inform the seller that the money order was bogus and deduct the amount from the seller's bank account. The seller is left holding the bag for the amount sent via Western Union with absolutely no recourse.

Most eBay sellers are savvy enough not to fall for the scam in the first place but, for some new eBay seller whose listings has closed with a buyer on hand, the temptation to agree to these "buyers" requests proves stronger than their intuition.

It appears that the lion's share of these bogus buyers use Buy It Now listings to ply their scam. Although savvy eBay sellers never fall for this ploy, the scammer still creates a major nuisance for the seller by closing out the seller's BIN listing with no real intention of paying for it legitimately. The victimized seller then has to re-list the item, apply for the Unpaid Item Final Value Fee credit, etc. For new or inexperienced sellers, the temptation to ignore intuition and to agree to the "buyers" request often proves too great to decline.

In either case, eBay sellers should think about adopting one or both of the following strategies:

Option 1.  Require Immediate Payment for all Buy It Now listings.

Options 2. Make having a Paypal account a  Buyer Requirement.

Option 1 will prevent anyone from closing out a BIN item without first paying for it through PayPal. However, it will only cover BIN items, not auction format items. Option 1 will also allow a person without a Paypal account to bid on an auction format item with BIN.

Option 2 will cover all items but also has a trade-off: if you don't also use Option 1, it will allow one of these false "buyers" who might have a PayPal account (highly unlikely by the way) to close out a BIN or win an auction item. Option 2 will also block legitimate bidders who do not have a PayPal account (a dwindling number of buyers I might add). However, a seller can always add an approved buyer to their Buyer Requirement exemption list.

I now use both options for all my eBay listings, especially after having received several fraudulent buyer solicitations in the last two weeks.

Another remotely-connected variation of this type of buyer fraud involves a buyer who wins or purchases an item and then asks the seller to hold off on shipping - as they prefer to send the seller a pre-paid shipping label for a major carrier (instead of honoring the seller's own shipping terms and prices). Sellers should never agree to this type of request. There are several possible ways this type of activity results in fraud and normally, I would spell them out here but let's play a little game...if you imagine a reason an eBay seller should not agree to use buyer-supplied pre-paid shipping labels, email your reason to me at griff@ebay.com and I will post the best ones here next time.

Griff