Real Estate and Overpayment Fraud
Scammers often take advantage of Craigslist and other free classified listings to defraud victims. In one scam, the scammers visit a legitimate real estate website and then re-list the properties for rent on Craigslist, complete with the addresses and photos. The scammers then answer e-mail inquiries about the properties and collect rental applications and credit check fees from the would-be tenants.
Overpayment Refunds – Sorry! Can I have my money back?
The Setup: A U.S. citizen has an item to sell and has advertised it online – usually for auction on e-Bay. He finds a buyer (the scammer) who pays promptly with an international money order. By mistake, the payer encloses too much money – the money order was made for $850 instead of $350. The buyer requests that the seller refund the excess money via Western Union.
The Payoff: Unusual for Nigerian 419 scams, this one does not rely on a significant potential payoff for the victim. It simply takes advantage of the victim’s (the seller’s) sympathy for the buyer and the desire to maintain good business contacts.
The Financial Catch: The seller assumes that the money order is valid – since the bank has accepted it – and immediately sends the refund via Western Union or other international money order. After a few weeks have passed, the bank informs the seller that the money order was actually a forgery. The bank must therefore deduct the amount of the money order from the seller’s account. The seller, therefore, is not only scammed out of the goods, but also the $500 in cash that he sent as a refund.
The Bottom Line: Many sellers make the mistaken assumption that, since money orders are bought with cash, they do not require a clearance waiting period like a personal check. It generally does not occur to the victim that the money order itself could be fraudulent.
The main variant on this theme involves online roommate services. Instead of sending money as payment for goods, the payment is meant as the deposit for renting a room. The scammer usually claims to be a student who urgently needs the excess money refunded so he can use it for paying school fees, transportation, and visas.
Yet another variant has the buyer alleging that there is a third person who owes him money, and he will arrange for that person to pay the seller directly. The amount the debtor sends is in excess of the agreed selling amount, so the seller is kindly requested to forward the difference to the buyer.
Victims of this scam should review our brochure on Resources for Victims of International Financial Scams
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