Aug 132007

I posted this in reply to a thread over at myLot, but thought it deserved a spot here at Philaahzophy as well. Essentially, the original poster had run an eBay auction for some craft project she had created. She was contacted by someone who was interested in having the auction item shipped to someone in Russia. They also wanted her to wire that person $500 with Western Union as a “surprise” gift. The ‘buyer’ offered to pay the seller an extra $200 via PayPal for their trouble.

While all the responses correctly pegged this as a scam to be avoided, the theories of how, exactly, it was a scam were all over the map. Theories from money laundering, to terrorist funding abounded. People were suggesting that Homeland Security and the FBI be contacted. In my past I’ve had significant contact with people who run this exact sort of scam, so I thought I’d share the exact details of how it all works. Hopefully a more full understnding of the methods used will help others avoid future iterations on this theme-

1) Buyer contacts Seller and offers deal/story (read original post)

2) Seller gets all giddy and accepts offer

3) Buyer sends $500 (to be sent via wire transfer), $200 (for Seller’s trouble), $15 (or whatever for bid), $30 (or whatever for shipping).

4) Seller withdraws money from PayPal to personal bank account and thinks all is well.

5) Seller ships off item to somewhere in Russia (or wherever) then goes to Western Union and drops $500 cash into a wire transfer made out to the name requested by Buyer.

6a) Buyer picks up wire transfer funds at ANY Western Union ANYWHERE in the world. Then does a chargeback on Seller’s PayPal account which (at best) gets closed down. More likely PayPal uses its preauthorization to withdraw the $745 from Seller’s bank account.


6b)Buyer picks up wire transfer funds at ANY Western Union ANYWHERE in the world. Then the person whose credit card the Buyer stole does a chargeback, etc etc.

7) Some random person in Russia receives an unexpected package from a stranger in the U.S.

8) Seller is out hundreds of dollars, massive amounts of time, and no longer has a PayPal account.

That’s pretty much a best case scenario. This scam has been run for YEARS. It’s nothing new. I’ve dealt with many, many people who have run this identical scam. For all you know the “Buyer” lives next door to you. Just because they SAY they are in Russia doesn’t mean they are.

Calling Homeland Security (or any other government agency) is simply a waste of your time and theirs. Terrorists, gangsters and money launderers don’t put this much time and energy into a $500 scam. There are easier ways for organized groups to steal significantly more. These are small time conmen. The scam works because a) people are greedy, b) Western Union only requires a matching name/keyword to pick up funds at ANY Western Union location anywhere in the world. For all you know this “Russian” could live down the street.

The important things are that-

1) you don’t take this “deal”,

2) you send everything you’ve got to eBay. Getting their account shut down won’t stop them, but if it happens often enough they’ll move on to an easier hunting ground,

3) that you don’t feel bad about even considering the deal for a moment. The con in con man is short for “confidence”, as in, they gain your confidence in order to take your money.

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