What are the common activities that potentially fraudulent buyers and sellers do?

Buyers:

• Ask you to wire money into their account.

• Offer high-value (but fake) cashier’s cheques in exchange for the item for sale. The value of cashier’s cheque often far exceeds your item and the buyer asks you to wire the balance back to them via a money transfer service. Banks will often cash these fake cheques AND THEN HOLD YOU RESPONSIBLE WHEN THE CHEQUE FAILS TO CLEAR. Scams often involves a 3rd party (shipping agent, business associate owing buyer money). We would strongly discourage you from wiring money.
• Recommend an unfamiliar escrow or payment service.
• Place large orders to be sent to a foreign location.
• Say they will pay you half of what’s due before they receive the item, and half payment afterwards.
• Will not provide you a verifiable telephone number.
• Pay with an international credit card or cashier’s cheque.

Sellers:

• Ask you to wire money into an International bank account.
• May ask you to send payment overseas and will only accept Western Union or another money transfer service (e-Gold).
• List an address that is different from the address on their item detail page.
• Recommend an unfamiliar escrow or payment service.
• Not be up front about the authenticity of items for sale.
• Will not provide you a verifiable telephone number.
• Try to convince you not to use payment services that offers protection (accepted services are those like Escrow.com and PayPal).
• Will repeatedly not answer phone calls or email.
• Continuously provide excuses about why you haven’t received an item.
• Sell suspect copies of software, music, or videos.
• Refuse to give you a working shipment tracking number.
• Sell an expensive popular item at a suspiciously low price.

What should I do if I suspect a fraudulent seller?

With the prevalent spread of internet scamming these days, it constantly gets more difficult to tell which ads ” ARE GENUINE AND WHICH ONES ARE FAKE” and which are not. Professional scammers are getting sharper at refining their schemes as fast as their traps are being discovered. At Alltheweb.co.za, we aim to provide our users with some great tips to help them foresee better which ads are legitimate from those which are FAKE, and are looking for opportunities to take advantage of unsuspecting customers. Protect yourself with the following tips:

Animal sales and adoption scams (Capuchin and marmoset monkeys, Parrots, etc.)

There are currently a number of these scams operating, mostly pretending to be selling or giving away capuchin monkeys for adoption. The majority of these scams are run from Cameroon, they usually accept your money and never send any monkey, parrot, etc. Note that many countries ban the importation of monkeys as pets, or have very strict licensing conditions, so it’s usually very hard to import pets from abroad. To import an animal it has to be kept in quarantine for several months so if someone is giving you the impression that you will get a fast delivery this is also false. Also look out for anyone who wants you to send them money through Western Union or Moneygram, since this a way for scammers to receive money without being able to be traced afterwards. 

Work at home scams

Fraudulent schemes often use the Internet to advertise purported business opportunities that will allow individuals to earn thousands of dollars a month in “work-at-home” ventures. These schemes typically require the individuals to pay anywhere from R150 to thousands of rands or more, but fail to deliver the materials or information that would be needed to make the work-at-home opportunity a potentially viable business. Often, after paying a registration fee, the applicant will be sent advice on how to place ads similar to the one that recruited him in order to recruit others, which is effectively a pyramid scheme. Other types of work at home scams include home assembly kits. The applicant pays a fee for the kit, but after assembling and returning the item, it’s rejected as sub-standard, meaning the applicant is out of pocket for the materials. Similar scams include home-working directories, medical billing, data entry at home or reading books for money.

For more information:

Tips for avoiding work-at-home scams (fraud.org) 

Pyramid and multi-level marketing schemes

Both pyramid and multi-level marketing (MLM, network market, matrix marketing) schemes have something in common. For both you have to recruit others to join, who will in turn recruit others to join. You are supposed to get a portion of the money from each of the people you recruit and those they have recruited.

Pyramid schemes are illegal in most countries, under fair trading legislation, because of two basic things: You are promised that you will make money from it, and you have to pay in order to join. The money making promise is false, since after only a few levels (e.g. about 10) of this scheme it requires more than a country’s population to join to enable the people above them to make any profit.

Multi-level marketing schemes and the rest aren’t illegal, since you get some kind of product when you join, and they appear to focus on the product and not the recruitment process, but most of these certainly won’t forget to let you know how much money you could theoretically make if you recruit others. Many of these schemes will also tell you they are not like other schemes out there.It is possible to make money from Multi-level marketing schemes, if you are any good at selling to other individuals. If you are good at selling to other individuals you can probably do fine already since you are probably able to sell toys, cars, property, insurance, etc. so you wouldn’t need to participate in a scheme like this. It’s not easier to sell to people you already know. Usually the products involved with these schemes are overpriced, for people you already know you it’s often easier to say no to you if they think they’re getting a bad deal. Also, in a group of friends, a group of people in a town or on the internet, once you’ve recruited two levels there will be a large number of people selling the same products in competition to each other in the same area or group. It’s a proven fact that most people don’t make money who join an MLM scheme. However, if you are good at selling you might be one of the few who actually do, the worst that can happen is that you buy some junk products you could maybe use and annoy a few friends by trying to sell it to them. 

Investment scams

Many investment scams promising very high returns are actually pyramid schemes in disguise. These schemes usually promise something over %5 (up to 30%) per month, or 60% per year. In other words for every R100 that you invest it pays at least R5/month or more out. What happens in reality is that people who has invested in the scheme receive their interest payout from money taken from your own investment or from that of new people who has invested in the scheme. These schemes often pay out their promised amounts of investors initially, since nothing sells their services quicker than people who’s received their ‘returns’ in the first few months. Unfortunately it’s impossible to sustain such returns, so one day the people who run the scheme disappears along with everyone’s money.

Payment scams

Please be careful when people pay with cheques, these can be forged and make sure the money has cleared first. Other very common scams has to do with bank transfers, where money has actually been paid in by cheque but hasn’t cleared, so it looks like the funds is in your bank account but it is not until the bank realises the cheque is fraudulent. These are usually accompanied by fake deposit slips. Another common form of these fraudulent transfers is where the person ‘accidentally’ paid too much money into your account, and is asking you to pay him back the extra money.

We will keep updating this page so check back for more tips