The 3 Most Diabolical Online Scams and How to Avoid Them

by Shawanda Greene

Classified ads are the preffered stomping ground of online con artists.

You’ll find internet hustlers creeping around most sections of classified websites: From the housing section to automobiles to jobs. These diabolical crooks have cooked up some pretty impressive tricks designed to rip off the most skeptical buyer.

So which scams should you look out for? And how do you avoid them?

Online ScammerThe Apartment Scam

How It Works

A scammer leases an apartment in a highly sought after location under a false identity. He then posts the place for rent in a classified ad for well below market price which entices many people to reply.

He’ll require first and last month’s rent as well as a security deposit from anyone who’s interested in leasing the unit. Renters are told they can move in at the beginning of the month, which might be two weeks away.

Within a week’s time, the fake landlord will swindle 10 or 20 people out of first month’s rent, last month’s rent and a security deposit. Then, he’ll trot on over to the next town and repeat the scam.

How to Avoid It

Performing a background check on the prospective landlord is the best way to beat this scam.

Also, ensure you’re writing the check out to a company that’s incorporated in your state. Refrain from making payments out to individuals, unless you can verify property ownership through a reliable source such as your county’s real estate tax assessor.

Google your building to see if it’s under professional management. If so, phone the property manager to confirm that your landlord is who he says.

Postdating a check to the move-in date won’t prevent a flimflammer from cashing it prematurely.

The Fake Escrow Company

Escrow Company Scam

How It Works

Say you’re interested in a $12,000 pickup truck. The seller can’t show you the vehicle in person right now, but he’ll take it off the market if you transfer the funds to him via an escrow company. Everyone’s safe, right? Not so fast, grasshopper.

Craigslist scam artists often setup their own legitimate looking escrow companies. Unlike an above board escrow service, once you transfer the money, you’ll never see it or the so-called seller again.

How to Avoid It

First, use either Escrow.com or another reputable, U.S. based escrow company.

Do a Better Business Bureau search for the company’s name prior to initiating the wire payment. Look for a positive BBB rating. Don’t think a lack of complaints indicates an organization’s legitimacy.

If the seller insists on using their escrow service, consider that a red flag.

The Employment Scam

How It Works

There are countless job scams to look out for, but one common sham involves scammers who trick users into filling out several pages of information that all appear to lead to a job. On the last page, you enter your cell phone number to get subscribed.

Shortly thereafter, you’re duped into signing up for a $9.99 a month cell phone subscription.

How to Avoid It

Never enter a PIN number sent to your cell phone onto a website. (I learned this firsthand after falling for a similar scam).

If a website asks you to enter a PIN they sent to your phone, it’s likely a scam. They can’t bill you unless you provide that PIN code. If you do, expect to rack up recurring junk fees on your wireless bill.

These are some of the smartest, most popular online scams. Use common sense and trust your gut.

You know how the saying goes: If a deal seems too good to be true, you’ll probably get your rump handed to you if you try to take advantage of it you greedy bastard.

What other clever online scams have you encountered?

Image courtesy of chanpipat / FreeDigitalPhotos.net

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{ 4 comments… read them below or add one }

femmefrugality September 3, 2012 at 12:48 PM

It sounds like the best way to stay away from scams is to stay away from Craigslist. I’ve been hearing so much of the rental scams lately….never done a background check on my land lord, but never had any problems. Next time we move I’ll have to be more careful.
femmefrugality recently posted..Voter ID Law in PennsylvaniaMy Profile


eemusings September 4, 2012 at 12:19 AM

BF once applied for a job online, ostensibly a customer service one, that then told him to give his bank account number as clients would put money into it and he would then have to make payments to someone else with that money. -_-
eemusings recently posted..Review: The Perfect BalanceMy Profile


Kelly@FinancialFixers October 24, 2012 at 10:29 AM

Wow, definitely need to keep these in mind. Seems way too easy for con artists these days to hide behind their computers and take advantage of unaware people. Then again, checking and double checking everything and anything you find on the internet before you fork over money should be a no-brainer.
Kelly@FinancialFixers recently posted..The Real Costs of Running a Blog BusinessMy Profile


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