On the Internet you can buy almost any item according to your precise descriptions in terms of version, manufacturer, and colour – even for cars, motorcycles and appliances regardless of geographic location. Escrow sites have made a secure exercise of shopping for these types of big-ticket items, because they ensure payment and product delivery. But what happens when swindlers and felons lure unsuspecting consumers and suppliers into fabricated escrow sites to steal their personal financial information, money and products?
Lamentably, escrow fraud is a fact of life. Some duplicitous persons build fake escrow sites and then act as shoppers or merchants in order to swindle gullible people out of their money or merchandise. When an escrow poseur pretends to be a vendor, he advertises a product for sale, and sweet-talks the shopper to deposit his money with the bogus escrow site – often telling him it’s for his own safety. The con gets the funds intended for the supplier, and the purchaser receives nothing in return.
When impersonating a consumer, the swindler trawls through auction and classified sites to locate an article he prefers and pretends to buy it. The scammer stands firm on using the fake escrow site, which advises the vendor that the shopper has remitted funds so the vendor ships the article. The scammer receives the goods and the supplier gets nothing in return.
How to identify and avoid fake escrow sites
Staying away from escrow fraud is really easy if you follow a few essential rules:
1. Be aware of several reputable and verified escrow sites before performing any transactions online
2. Beware of a consumer/seller adamant on using a specific escrow site you have never heard of (some use many sites to confuse cautious shoppers/vendors)
3. Beware of escrow sites that are badly designed, look inadequate, contain many spelling or grammar mistakes, and/or don’t furnish adequate information about proper use of the site or who runs it. Reliable escrow firms devote a lot of time and money to set up quality sites.
4. AVOID an escrow site whose URL (web address) doesn’t begin with “https://” – the “s” is important; it indicates a secure site with 128 bit encryption technology. An escrow site that’s not secure is most likely fraudulent.
5. Beware of escrow sites with suspiciously low escrow fees. Low escrow fees are sometimes used to entice people in.
6. DON’T remit funds using untraceable money wire firms, like Western Union or Money Gram.
7. DON’T send escrow funds to an individual or agent. Legitimate firms only have you entrust funds with a corporation that is authorised to handle escrow transactions.
What to do if you suspect an escrow site as fraudulent
Here are some tips to double-check whether an escrow site is legitimate:
1. Perform an internet search using the company name as keywords. If only the escrow site comes up, it’s probably an illegitimate site.
2. Look for the company’s domain name in a WHOIS database. If the domain was registered recently or the contact information cannot be confirmed, avoid the site.
3. Find out if the company is licensed and who the licensing authority is. Then look up the licensing authority and confirm the registration numbers provided. Make certain that the registration number refers exactly to the company. Double-check the licensing authority’s own site. If it shows any of the danger signs for fraudulent sites, assume that this site is fake – and so is the escrow company it authorised.
4. If an escrow site purports to be affiliated with Ebay, Yahoo! or a similar company, cross-check the relationship from the alleged affiliate.
5. Any escrow site that alleges to be affiliated with a larger, better-known escrow firm is probably not legitimate. Reputable escrow firms rarely operate in this way.
What to do if you fall victim to a fraudulent escrow site
If you have been defrauded by a illegitimate escrow site, you ought to report the site to authorities immediately and take action to protect yourself against identity theft.
In the United Kingdom, you can report Internet and escrow fraud to the Metropolitan Police
In the U.S., you can report fraud through your local police, the Secret Service, and/or the Internet Crime Complaint Center.
If the fraudulent transaction occurred in connection with Ebay, Yahoo!, Craig’s List or a similar site, you should report the incident to that company as well as the police.
You can also report the website to the company with which the website is hosted and ask them to close the website.
For reporting identity theft in the United Kingdom, visit the Metropolitan Police website.
In the U.S. report identity theft with Federal Trade Commission.
Staying on the safe side
The most effective way to stay away from an online escrow scam is to use a popular and reliable escrow firm, such as PayPrimo.com. PayPrimo is a licensed and authorised escrow corporation with a reputation for reliability. The PayPrimo site is easy to use, has a variety of traceable payment options, and uses at least 128-bit encryption security for your protection.