Seven Keys to Avoid Scams on eBay®
This article listed with permission from Auction Inquisitor.com

Is this auction a SCAM?
Do you worry about being scammed on eBay®? When you buy from someone face-to-face you have a feeling of security. You make judgments about the person and their body language to determine if you trust them or not. On the Internet, this is not so simple. Many people have a natural aversion to the very idea of sending money to a stranger.  Buying on eBay® can be stressful for someone who has not purchased through an auction but I can show you that it is not only possible to trade safely, it is FUN!

The Seven Keys To Avoiding Scams on eBay®™
I have put together Seven Keys that will help everyone avoid almost all scams on eBay®.  My seven keys can help anyone use eBay® safely.

7. Avoid auctions with bad grammar or that are in all CAPS.

These are common signs of both scammers and problem sellers. Not every auction with bad grammar is a scam. None of us have perfect grammar or spelling but if an auction sticks out with extremely bad grammar, strange usage of words, or spelling mistakes any third grader could spot, you know something is wrong with that auction. If an auction is posted in ALL CAPITAL LETTERS, which is quite rude anyway, the chances of the buyer having a problem with the purchase are increased by a factor of TEN! Many of these auctions are not posted by scammers but they are posted by problem sellers.
A problem seller is anyone you do not want to buy from. If the seller cannot communicate effectively in the auction then what happens if there is a problem with the purchase? The seller will not be able to communicate effectively and may become upset with the buyer and cut off communications. The problem seller may leave out critical information about an item, fail to describe an item accurately, or may poorly pack an item when shipping it. Bad grammar is also a sign of fraudulent sellers. Many full time scammers operate from countries like Romania or Indonesia where English is not spoken natively. When these people post auctions, they may use broken English or English translation software which makes their sentences sound strange. When you purchase from a seller with bad grammar or poor spelling, you are ten times more likely to have a problem of some sort than you are with a properly presented auction.

6. Beware of any auction that requests Western Union®, Moneygram®, Bank Transfer, or any unusual payment method.

Scammers frequently request payments by means that have no buyer protection. Western Union is a great service for sending payments to family and friends but never for auctions. You should never use Western Union, Moneygram, or any similar instant cash service to pay for an auction. Professional criminals often insist on being paid by Western Union because they can pick up the money and disappear. The buyer has no buyer protection and cannot recover their money. This is commonly used by scammers in Romania who offer cars below their Blue Book value. They collect a payment by bank transfer or western union, then the buyer never hears from them again.  They may also try to confuse the buyer by recommending a website the buyer has never heard of to make a payment. These are fake websites setup by the scammer to trick the buyer into revealing their personal information and credit card numbers.
Only pay for items with a method that has buyer protection like your credit card or PayPal®. Any legitimate seller will accept one or both of those methods. Any seller who insists on Western Union, bank transfer, or any unusual payment method, or who is anxious to collect a down-payment or a holding fee by Western Union is trying to pull a scam.
PayPal® at PayPal.com is the safest way to pay for an auction. PayPal® is a company owned by eBay® and you can use PayPal® to send an electronic payment to anyone else with a PayPal® account. It is very simple and it is secure. At least it is secure if you follow the rules. The rules are spelled out on the PayPal® website. Too many people complain when they are scammed but then they admit they were scammed because they ignored the warning signs. Things like a buyer with one name and the payment coming from someone with a different name. That is always a sign that the person is using a stolen PayPal® account. Many people are afraid of sending money to a stranger and never receiving anything but with PayPal® you can always file for a refund if you do not receive what you paid for.  The same is true with a credit card, not a debit card, but a real credit card. Your credit card company should offer 100% protection from fraud.

 5. Always research a seller before buying. Always research a buyer before shipping.

Bad or fraudulent members often have a history of problems. This is one of the most misunderstood parts of the buying process. Many buyers never even look at the seller’s past sales or feedback history. They buy and hope they receive what they paid for. This is crazy. Ninety nine percent of eBay® auctions are legitimate so this will work for a long time but eventually your luck will run out. You must check a buyer or seller’s history before completing the transaction. A simple check of the seller’s feedback history to see if anyone has complained, to see if the seller has a history of selling similar items, and to see if the seller has any selling history at all, can easily reveal a scammer or a problem seller. You should never buy from anyone without checking their feedback for past auctions.  Check buyer and seller feedback to see if they have a history of complaints.

4. Beware of any auction where the seller insists on contact outside of eBay®.

Any seller who tries to sell direct, outside of the eBay® auction, is offering the same item to everyone who contacts them without shipping anything. This is another huge sign of a scammer. Scammers will post messages in the auction stating that interested people must contact the seller by email before bidding, even threatening to cancel bids if they do not contact the seller first. That is always a sign of a scammer. The scammer will then make a direct offer to sell the item to everyone who contacts them. The scammer collects money from everyone they can and then they disappear. Never trust any seller who offers to make a deal outside of eBay® or who insists on contact before bidding. They are always scammers.
After the buyer is scammed, they can’t even leave negative feedback for the seller because the deal was made outside of eBay®. Any seller who tries to make a sale outside of eBay® is not only violating eBay® rules, they are trying to scam the buyer. They give a direct email address and insist interested bidders use it instead of the message center because they want to avoid the eBay® message center. If they use the message center then eBay® may catch the scammers trying to make a deal outside of eBay®. That is why they use an email address in their auction.
They may also have an unusually high buy it now price. If someone has an item worth $1000 and they post an auction and list it at $100,000, which I have seen them do, you can be sure it is a scam. They are trying to make people contact them directly and they will say it was a typo or some other excuse then offer to sell direct to everyone who contacts them.

3. Beware of any auction that has any sense of urgency or that tries to play on your emotions.

Auctions should sell goods, not a story. You can be sure that any auction you see which claims the seller is in need or the seller must sell quickly is a scam. These commonly include phrases like “I must sell these today”, “My little girl needs surgery”, “I have to move and sell everything fast”.  No one has to sell anything fast unless they want to collect the money and disappear before the police catch up to them. There are many auctions on eBay® right now that have sad stories claiming the seller’s child is sick, or their husband is in the military and they need help. This is not an auction, it is a scam. Any auction that tries to play on your emotions is a scam. Honest people simply do not post such auctions. These scammers are often very blatant and will give a long story about how much they need help, then they turn around and offer a prize to the person who crosses the $200 bid mark. They are running an illegal contest to see who can give them the most money. They do not even have a sick child or a husband in the military.
Another emotional scam involves the seller claiming “I have this item listed locally for sale so I may cancel the auction at any time”. Dishonest sellers put this in the auction to force interested buyers to contact them immediately. They want to make potential buyers think that they will lose the great deal or the rare item if they do not act hastily. The scam seller wants the person to act before they have time to think. Legitimate sellers will never list an item on eBay® and in local classifieds at the same time.  
Emotional plea auctions are all scams, period.

2. Never click on links in any email whether it is related to eBay® PayPal® or anything else.

Scammers frequently use fake emails to trick people into revealing their eBay® and PayPal® passwords. Scammers will send out fake emails that look just like PayPal® or eBay® messages. These messages trick people into going to fake websites that also look just like eBay® or PayPal® but they are setup by scammers. They are also called Phishing emails, because the scammers are fishing for information. The victims type in their eBay® or PayPal® passwords thinking they are logging into their account but in fact their passwords go straight to the scammers. The scammers then post fake auctions or transfer money out of their PayPal® account. This is a very common scam and is the number one reason for hijacked eBay® accounts. What is so terrible is that this is easy to stop. There is a free toolbar called My Little Mole from mylittlemole.com which will warn you if you are tricked into going to any of these fake websites or any of thousands of other fraudulent websites. If everyone used this toolbar, hijacked accounts would be a thing of the past.

1. If it sounds too good to be true, it is.

This is the number one reason to use common sense. If it sounds too good, it is too good to be legal. Would you like a new car that normally sells for $20,000 dollars but is offered for $10,000 and all you have to do is send a $1000 down payment by western union?  You will never find it. No one is ever going to sell something of value for half what it is worth. This scam seller is only interested in collecting the down-payment.

EBay® is Fun

I am absolutely not afraid to do business on eBay®. I check my favorite categories on eBay® every day. I buy and sell eBay® one or two times a week. I also buy expensive antique arcade games, sometimes costing $2000 or more and I have never been scammed in these transactions. It is really fun and you can find so many bargains there. Also, as a collector myself, I enjoy going through the antique and collectables groups to find some of the most unusual items.  Things I would never even know about if I had not seen them on eBay®.  

Almost every scam can be avoided by just looking for the common signs of a scam in the auction itself. I have made tens of thousands of transactions through eBay® and PayPal® as a buyer and seller and I continue using both because I know I can use them safely.

 Who is responsible for these scams?

There are a number of different types of scammers. Some are simply dishonest people who think they will cheat someone else out of a few dollars, maybe they think they will do it just this one time. Some are career criminals connected to organized crime. These people approach scams as a business. They are the ones who setup fake auctions and go for the hundreds and thousands of dollars in fake car auctions, fake laptop computer auctions, and other high priced items. There are also auctions for stolen items and counterfeits. Scammers will import counterfeit designer jeans and sell them through eBay®. They will also steal laptops from a warehouse and then sell them on eBay®.  These are full time criminals.
There are also dishonest high school kids who only want to make $50 or $100 to buy a video game or to treat their friends to a night on the town.

And then there are the incompetent sellers or buyers. They may not be dishonest but if you buy from them and the item arrives broken or completely different than it was described, the buyer still feels like they have been scammed.
Every one of these can be identified by a simple look through the auction contents and at the seller’s history. All of these types of scammers can be spotted. When you know what to look for, these scam auctions stand out as if they had a flashing red light on them.

 I have only given my 7 keys but there are many other things you can check when it comes to the seller’s history and other items to check in the auction itself.

Auction Inquisitor Analysis Software

I know it can seem overwhelming with so many things to check so I put everything I could in the Auction Inquisitor software from www.AuctionInquisitor.com This is FREE software, no charge for it, just download and when you are interested in an auction, type in the auction number. The software will scan the auction and the seller and then give you a report on the auction. It will show you what in the auction should be a warning sign to alert you about potential fraud or problem sellers. Once you have the report, you can decide if you want to purchase from the seller or not. The auctioninquisitor.com software makes researching an auction easy. I use it all the time because it is easier and much faster than looking through a seller’s feedback myself.

What are some other things to look for in an auction?

Beware of anyone who wants you to pay using an escrow company other than escrow.com. Escrow fraud is huge on the internet. Suppose you buy a car for $10,000 but you are unsure about sending the money to the seller. The seller offers an option to pay a third party escrow company and the escrow company will hold the funds until the buyer receives the goods. That sounds pretty good until you know the escrow company is not a third party. It is a fake website setup by the scammer. When the buyer sends the payment, they never hear from the escrow company or the seller again. The simple way to avoid this scam is to never use any escrow company other than escrow.com. That is an eBay® owned company and it is the only company approved for eBay® auctions.

Beware of any seller with zero feedback. No honest person will ever join eBay® and then immediately begin selling expensive items. It simply never happens. New members will build feedback by making purchases first to gain eBay® experience. Those are legitimate purchases made over time. Never trust a seller who has only 10 purchases all made in the same week. Scammers will setup new accounts with zero feedback ratings and offer expensive items. Generally you should never buy anything from anyone with less than ten feedback ratings. You should never, under any circumstances, for any reason, buy anything from anyone with a zero or negative feedback rating. Auctions posted by sellers with zero feedback that are selling expensive items are fraudulent auctions 97% of the time. Only purchase from people with established feedback histories who have been members of eBay® for at least one year.
Beware of anyone who wants to do something unusual even if it is following a list of instructions to ship or make payment. Anyone who sends you a list in order to complete a transaction is a scammer. Transactions on eBay® should be simple, place a bid, win the auction, click the pay now button to pay by PayPal®. If it becomes more complicated, then there is something fishy about it.

Beware of anyone who asks you to sell something for them on eBay®. I don’t care if it is your best friend or a stranger on a message board. Selling for someone else when you are not an experienced and eBay® approved Re-seller is always going to end badly. This is a very common scam too. Criminals will post to message boards asking people to sell items for them on eBay® for a commission. They find a dupe willing to sell for them. Then the person posts several auctions for laptops. The laptop auctions close on eBay® with high bidders and the dupe forwards the money to the scammer minus their commission. The scammer disappears and now this person has sold several laptop computers and has nothing to ship. They have committed not just fraud, but also the crime of money laundering and they did not even realize it. Transferring money to a third party like this is money laundering. The crook got away with all the money and left their re-seller victim holding the bag. Anyone who tells you ‘all you have to do is sell’ is trying to scam you whether it is on eBay® or off.

Is negative feedback a tip off about a bad seller?

Not always. A good seller with a lot of positive feedback may have some negative comments. That is just part of doing business with the public. As long as someone has a 98% or better feedback rating they should be good to do business with. But, you cannot look at just the feedback rating. If the account was hijacked, then the feedback rating of the person who owns the account means nothing because a scammer now has control of the account.
 Hijacked, what is a hijacked account?
A hijacked account is an account that is taken over by a scammer. This happens when a scammer tricks someone into revealing their password for their eBay® or PayPal® account.  Usually it is by a phishing email.

What is a phishing email?

Phishing with a P is a play on the word Fishing with an F, It means scammers are fishing for information. Some scammers setup fake accounts on eBay® to sell items. But those accounts are obvious because they have zero feedback. They cannot commit the big scams this way, not easily. They need accounts with a long history. So, they send out fake emails to thousands of people. These emails look like they came from eBay® or PayPal®, and when someone receives an email that looks like it came from eBay® claiming their account needs to be updated or it will be disabled, the person clicks a link in the email to update their information. That is where the problem starts. When this person clicks the email link they are not taken to eBay®, they are taken to a website that looks just like eBay® or PayPal®. They then enter their password in this look-alike site setup by the criminal. The criminal now has their password.

The criminal then logs into the persons account and posts fake auctions using this victim’s good name and good feedback rating. They can also login to the victim’s PayPal® account. Lots of people use the same password for eBay® and PayPal® which is a mistake. Never use the same password for both. This scammer can post auctions for weeks before the account owner realizes their account has been hijacked. It is when the complaints start coming in that the victim knows something is wrong. By then the scammer has ripped off a lot of people and used the victims PayPal® account to transfer the money out of the country. You can easily protect yourself from Phishing emails disguised as eBay or PayPal messages by using a free security toolbar like the MyLittleMole toolbar.

How do I spot these fake emails?

Usually they are easy to spot. Real emails from eBay® or PayPal® will start with your real name. Fake emails usually have a generic opening like Dear eBay® User, or the email address. If the email does not start with your real name, you know it is a fake. Scammers have also learned to send emails with the person’s real name too. They will win an auction and once they know the users real name and email address, they send a customized spoof email that looks exactly like the real one. 

Why does eBay® not stop the scams on their site?

They do as much as they can. It is not a simple matter to stop the scams. Especially when they have scammers using hijacked legitimate accounts with long positive histories.  eBay® also has many thousands of legitimate auctions listed every day. Among those, they have to find the small number of scam auctions.  Spotting scam auctions is not simple when you have that many to go through. It is buyer beware(and if you are a seller, seller beware). You have to look for the warning signs and not depend on just the user’s feedback rating. Most fraudulent auctions are easy to spot. Some scammers are becoming more advanced in their methods though.
 
What do the more advanced scammers do?

Scammers have begun adapting tried and true phone scam techniques. They may not scam the person on eBay®. They may sell them an expensive item at a discount, or a counterfeit item, and once the buyer receives the item, then they have established trust. The scam seller will try to sell them something bigger or approach them with some story about starting an importing business or needing to hire someone they trust in the USA.
They may bid on an auction or post a fake auction and ask for the other party’s phone number, name and address. Of course, this may be needed to send a payment by mail. Then later someone in their criminal organization will call the person by phone to try and scam them directly. When they call, they already know the person’s name and address and other information. This makes the victim trust whoever is calling.  The victim has no idea the person calling was connected to the eBay® auction from two or three weeks ago. The scammer may say they are calling from eBay®, PayPal®, the bank, another company or the police. The scammer can claim to be anyone, they can even send fake caller id information which makes them look legitimate. The rule here is, never trust anyone who calls you on the phone and wants something. If eBay® or PayPal® need to contact you, they will send an email which directs you to your message center on their website. They will never call you by phone to ask for your password or to verify anything.
If anyone calls you on the phone and tries to sell you anything or asks you for any personal information, HANG UP!

Where are the scammers located?

Many of them are outside of the USA. There are scam centers in Romania, Indonesia, the Philippines, Russia, Nigeria as well as other countries. You should never do any business with anyone in any of these countries. If you are not a fortune 500 company, then you will never conduct legitimate business with anyone in any of these countries.
These scammers have started setting up scam centers in the USA. They will fly into a large city, setup a scam operation with stolen identities, hire drug addicts and immigrants to pickup payments at western union or from mailboxes and scam as many people as they can. Then they pickup and go back to Romania or wherever they came from once they have made a lot of money or if they think the police may be onto them. One of their rules is to never sell to anyone in the same state. This keeps local law enforcement from checking on them. If you ever ask a seller to pick up an item and pay in person and they refuse, you may be dealing with one of these organizations.

Can’t you tell which seller is legitimate from their feedback rating?

NO it is absolutely not the feedback rating.  It makes me so mad when I see books on eBay® with detailed sections about how to place a bid on eBay® and nothing about how to determine if a seller is a scam artist or if the account is hijacked. No No NO, do not trust the feedback rating.
Scammers can setup a hundred or more accounts and use them to trade feedback among each other to build up their feedback and look legitimate. And if a scammer hijacks a legitimate user’s account, they have a good account with good feedback. You can never tell either of these is fraudulent from simply glancing at the feedback. The feedback will still reveal these scammers, but you have to look a little more carefully. Look at the feedback ratings themselves, do they all sound the same, are they all in broken English? Are the people leaving feedback for the seller also leaving feedback for everyone else the seller has sold to and were all of their accounts created at the same time? That is clearly a fraudulent seller who has created a block of accounts. Take a look at what the person has been selling. If a long time member with good feedback has ten auctions selling a $500 laptop in each and you see from their feedback that in the past they have only bought stamps without selling anything, then you know immediately that this account has been hijacked. This person is a stamp collector and suddenly they have ten auctions for expensive items? That makes no sense at all and there is clearly something wrong with that auction.
Just a few seconds of checking can reveal fraudulent sellers like these but most people don’t bother or don’t know what to look for.

What else do eBay® users need to know?

There is no way I could cover all of the scams or the techniques to protect yourself here, but I have covered some of the most important points that can help you avoid scams and trade safely on eBay.

CONCLUSION

I am not telling anyone they should not use eBay® or PayPal®. I am actually saying YES you should use them but you should do it safely. These are great services and you are missing out on a lot of fun and excitement not to mention a lot of bargains and many items that you could never find in a store if you do not use them.

But, you have to exercise some common sense and pay attention to warning signs. Knowing what to look for will make spotting fraudulent auctions easy and some basic steps can protect your accounts so that you never have to worry about anyone obtaining your password. I have used eBay® and PayPal® for years and my accounts have never been hijacked because I practice the basic security measures we have discussed.
Remember, always check an auction against the Seven Keys™ before placing your bid and if it sounds too good to be true, it is.

You can download FREE eBay related software including the Auction Inquisitor™ software to scan auctions for signs of fraud at www.AuctionInquisitor.com and the MyLittleMole free security toolbar at www.MyLittleMole.com

Auction Inquisitor™ and the Seven Keys To Avoiding Scams on eBay™ are a Trademarks of Elite Minds Inc. eBay® is a trademark of eBay Inc. Auction Inquisitor and this article were written and developed independently by Michael Ford, The Auction Inquisitor, for Elite Minds Inc and neither are a product of, nor endorsed by eBay Inc.

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