by Dotti
Wed Jan 22, 2014 5:42 pm
Unfortunately, this particular scam is getting increasingly popular.
We encountered a set of sites doing the same thing a few months ago.
To clarify to some of the readers who may not understand what we are talking about, this is what happens:
1) Criminals buy, phish, or hack to get credit card numbers from a large number of innocent people.
2) They set up a fake website, offering real merchandise for sale. They typically copy photos and descriptions from legitimate sites. They set their prices to less than retail.
3) They set up their website to accept paypal, and start taking orders.
4) When an order comes in, the criminals use a STOLEN credit card to order the item from the legitimate site. They have the order delivered directly from the legitimate seller to the buyer.
5) The criminals take the paypal cash. The innocent person who placed the order on their fake site has just helped them to succressfully turn a stolen credit card into cash.
In many cases, the innocent buyer receives the item, everything seems fine, and they never suspect something is wrong. But in other cases, things go a bit awry. Here are some of the things that can (and do) happen:
-the scammers use a credit card that has already been flagged for fraud, and the legitimate seller refuses the order. In this case, the buyer ends up with no item at all. If he places enough pressure on the criminals, they might try again with a new stolen credit card. Eventually, though, they won't bother and the buyer will have to go the paypal complaint route. At that point, the number of complaints posted about the site usually increases significantly, as more and more buyers find themselves with no item (or the wrong item.)
-The owner of the credit card identifies the loss and the bank decides to investigate. In this case, the buyer can find himself in a serious mess, as he has just received stolen merchandise. The buyer may find himself under investigation, and depending on the circumstaces, he could end up facing criminal charges. The scammers, who are using fake details, are nowhere to be found.
-The theft is investigated, and even though no charges are filed, the buyer ends up blacklisted when it comes to getting credit.