Internet Fraud Can Happen to You

Internet Fraud Can Happen To You

© by Barry Stein

On two occasions I have received fraudulent orders for Beanie Babies which originated from my Beanie Baby website at BarrysBeanies.com. On both occasions the orders were for over $1,000. I almost became a victim of Internet fraud.

Internet fraud can happen to anyone who does business online. Hopefully this information will help you from becoming a victim of Internet fraud.

Internet Fraud Transaction #1:
The first fraudulent order placed on my website was for about $1,500 worth of Beanie Babies. The billing address did not match the shipping address.

This in itself is not what I will refer to as a "Red Flag" since sometimes people move and don't update their billing address right away, or perhaps the zip code they give isn't the full zip code number as it appears on the billing address, or sometimes the merchant account system is down and the information doesn't get verified when the order is placed.

Internet Fraud Red Flag
Billing and shipping address don't match.

What also caught my eye on this first transaction was the fact that it was for all the same style of an expensive Beanie Baby and the total sale was for a high dollar amount.

Internet Fraud Red Flag
Unusual order for a high dollar amount of product.

I called this person to verify the address and their phone number was not in service.

Internet Fraud Red Flag
Phone number is not in service.

I sent an e-mail to this person and asked him why his phone number was not in service and I told him I had to talk to him on the phone before I would ship the Beanie order.

He e-mailed back and said his phone was temporally out of service and he'd call me.

He called me on the phone, but he used a relay call. A relay call is when you use the operator as the a go between or middleman in the conversation. So you give the operator your message and she or he relays it to the other party and the other party does the same thing. I'm thinking that perhaps this person has some kind of disability that prevents them from being able to make a conventional phone call.

I tell this person that the shipping and billing address don't match and I have to verify the billing address. I also tell him I need the 3 digit code number on the reverse side of the credit card.

He says he doesn't have the card on him, that his wife has it. I'm getting nowhere with him and tell him that I will not ship his order until I have the information that I need in order to verify that the credit card is his. He says he'll get back to me.

After a week I don't hear from him and he doesn't respond to my e-mails. So I mail him a letter requesting the information I need. I never heard back from him. So I never shipped the Beanies.

Internet Fraud Red Flag
Person uses a relay phone call.

(NOTE: Many people with disabilities use relay phone calls. A relay call doesn't necessarily mean it is a fraudulent order. It is just one of many red flags you should be aware of.)

Internet Fraud Red Flag
Person cannot or will not provide you with the 3 digit code number on reverse side of the card.

Internet Fraud Transaction #2:
I receive an e-mail from someone who wanted to order about $1,200 worth of Beanie Babies and he wants them shipped to Nigeria quickly. He tells me that I'm going to get a lot more business from him.

Internet Fraud Red Flag
Shipments to Nigeria, Eastern European countries and Far Eastern countries like Malaya, Hong Kong, etc.

Internet Fraud Red Flag
The buyer wants to have the order shipped quickly.

Internet Fraud Red Flag
Buyer tells you that he will buy a lot more product from you in the future.

I tell this guy that I will only ship to the billing address that appears on the credit card. He finally agrees to this and gives me all the information.

So I have the billing and shipping address which match, and I also get the 3 digit code number on the reverse side of the credit card from the buyer. I figure everything is OK, so I ship the Beanies to the USA address by UPS.

A couple of days later I get a call from UPS and they inform me that the address I'm shipping the Beanies to has been targeted by them as an address that has been used for fraudulent transactions. I tell UPS not to deliver the Beanies and to ship them back to me.

So somehow these crooks are able to get credit card information and to change the shipping and billing address to a USA drop-ship location. So even though the billing and shipping address match, and they can provide you with the 3 digit code number on the reverse side of the card, doesn't mean that you are safe from being scammed.

Soon I get an e-mail from this person asking where his Beanies where and how come he hasn't received them? I tell him what happened with UPS and he claims there is a mistake. I tell him fine, call UPS and get things straightened out with them and have them call me. He says he will take care of it.

At this point I decide to give him a call and see if the phone number he gave me is in service. The phone number is not in service. I send him an e-mail and ask him what is the problem with the phone? He says it is temporally out of service and he will call me.

Internet Fraud Red Flag
Phone number not in service.

He calls me, but it's a relay call. I guess these people don't speak very good English.

Internet Fraud Red Flag
Relay call instead of calling you directly.

Needless to say I never completed this sale.

Here is a summary of things you should consider anytime you receive an online order. Don't become a Internet fraud victim.

1. Large dollar purchases.

2. Unusual product orders.

3. Any attempt to have you ship outside the USA to areas known for fraudulent transactions -- like Nigeria.

4. Phone numbers that are not in service.

5. The use of relay phone calls.

6. Just because the billing and shipping address match and they can give you the 3 digit code number from the reverse side of the credit card doesn't mean it is not a fraudulent transaction.
7. The buyer wants the product shipped quickly.

8. Promises of buying a lot more product from you after you complete the first transaction.

9. They don't care what the cost of the shipping will be. (It's not their credit card so why should they care about how much the shipping costs are?).

If in doubt, ask them for the name of the bank or financial institution that issued the credit card and the 800 phone number on the back of the credit card.

Unless they actually have the credit card in their possession, they won't be able to provide you with this information. If they are able to provide you with this information then call the bank or financial institution and report your suspicions to them. They will be able to verify that the transaction is good.

I just learned from one of my associates that he got an online order and shipped T-shirts to Nigeria. It was a fraudulent transaction. I wish he had talked to me before he shipped the T-shirts.

I think these fraudulent transactions are taking place often online. Why don't the credit card companies let merchants and consumers know about this Internet fraud that is going on?

Only thing I can think of is that they do not want this information publicized since perhaps consumers would not use their credit cards as much to make purchases online.

The best thing you and I can do is to make others aware of the Internet fraud that is going on.

Barry Stein is the owner of www.aWebBiz.com where he offers cutting-edge tips on all aspects of business. To find more advice, tools and resources to help you succeed in your business, visit: http://www.aWebBiz.com

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