Too much trust can cost you big time when it comes to escrow companies on the web if you are tricked into using a real looking yet fake escrow site.
Fake escrow web sites may be one of the most successful internet scams of all time. This is because they prey on big ticket auction winners and rely on the consumers trust of escrow web sites. The losses incurred by auction winners from phony escrow sites is in the tens of thousands of dollars at a time and has quickly added up to millions of dollars in losses for big ticket auction winners.
This has happened because the use of escrow web sites has been considered the safe way to make an exchange when an online auction involves an item of more than average value. This almost universal trust of escrow opened the door for the criminal element to come in and exploit that trust. You need to be very careful because it’s hard to tell a phony escrow site from a real one.
How to spot the fake escrow sites
When phony escrow web sites first appeared they appeared to be unprofessional and were much easier to spot. They had poor layout and graphics or were filled with poor grammar and spelling. But as time has gone on and fraudulent escrow scams have become more successful they have become far more slick and professional. This makes distinguishing between a real escrow site and a fake one almost impossible unless you are prepared to research the information on the web site. Almost all you can do is rely on recommendations from other consumers or financial institutions.
But if you look around you may find signs that the content was copied from a real escrow web site and the phony site neglected to change information on pages like the privacy agreement. You can also keep an eye on who and where the money is going to in case anything seems unusual. An example might be a payment to Nebraska Investments Corp. going to a Romanian bank.
Another sign things might not be kosher is the seller insisting you use a specific escrow website. If they tell you to either use the escrow site they’ve chose or it’s "no deal" you might not want to do business with them. If the seller and escrow company happen to have the same email address or appear to be related in any way there is a high likelihood that something is not right.
Always pay for your online auction with a credit card
And no matter how great a bargain it may seem to be, never buy anything online from someone who approaches you through instant messaging or e-mail. Often, what happens is the contact person will tell you they have the item you are bidding on and will sell it to you for less. They may even lead you to fake Web sites they set up. By registering on the site, you provide them with all the information they need to steal your identity — and of course, you never receive the items you paid for at their site.
To stay safe, only shop sites you know and trust.