One of the biggest indications of a scam, if not the biggest, is any request that money, for any purpose, be sent via a money transfer service like Western Union, MoneyGram, Coinstar, Liberty Reserve, Vigo, Moneybookers, Okpay.com, MoneyPak, Vanella Reload, or REloadit Pack
Bank to Bank Transfer / Telegraphic Money Transfer is not much better since once you transfer money to a bank account the transaction cannot be reversed even if you are scammed! (See more details below)
Western Union and MoneyGram both recommend that consumers never send money to strangers using their services. Obviously, in any online transaction you are sending money to a stranger, so you should never send money via a money transfer service in any online transaction. Sending money with a money transfer services is just like sending cash. Once the money is sent its gone, and you can't get it back, even if you were scammed. Sending money via WU/MG to someone you don't personally know is like giving cash to a stranger and hoping he does whatever he says he will ... when and if he comes back!
WU and MG agreed to place fraud warnings on their websites as part of a settlement of two class action lawsuits brought against them resulting from fraudsters abusing their services. See: WU and MG for information on the lawsuits. The Federal Trade Commission (FTC) and the London Metropolitan Police have similar warnings. Excepts from the warnings are quoted below. Click the titles to see the full warning.
The Western Union Money Transfer® service is a great way to send money to people you know and trust. If you need to send money to someone you don’t know well, you may be putting yourself at risk for fraud.
* Never send money to a stranger using a money transfer service.
* Beware of deals or opportunities that seem too good to be true.
* Don’t use money transfer services to pay for things like online auction purchases.
* Never send money to pay for taxes or fees on foreign lottery winnings.
* Never provide your banking information to unknown individuals or businesses.
* Never send money in advance to obtain a loan or credit card.
* Verify every emergency situation before sending money.
See also Western Union Fraud Center
Make sure the person or company you are sending money to (or who you are sending money on behalf of) is someone you know and trust. Please also keep the information relating to your transaction confidential. Once the money has been paid out to the person you name as the receiver, cancellation or refund is no longer possible.
Federal Trade Commission (FTC)
You’ve won a prize!
I’m in a foreign country, and I need cash.
We’re temporarily unable to accept credit cards.
Your dream apartment is available immediately at an incredible price!
Scam artists use a number of elaborate schemes to get your money, and many involve money transfers through companies like Western Union and MoneyGram... money transfers may be useful when you want to send funds to someone you know and trust — but they’re completely inappropriate when you’re dealing with a stranger.
Why do scammers pressure people to use money transfers? So they can get their hands on the money before their victims realize they’ve been cheated. Typically, there is no way you can reverse the transaction or trace the money. Another reason: When you wire money to another country, the recipient can pick it up at multiple locations, making it nearly impossible to identify them or track them down. In some cases, the receiving agents of the money transfer company might be complicit in the fraud. Money transfers are virtually the same as sending cash — there are no protections for the sender.
Metropolitan Police (London, England)
Money transfer services are often used by fraudsters in connection with many types of fraud...
* Never let a fraudster educate you on how a money transfer service works - only take advice from the money transfer company.
* Never ignore the warnings or make false statements on money transfer documents. The information is there to protect you.
* Do not pay for items bought on line, including via Auction sites, using a money transfer service. Providers of money transfer services are not responsible for the satisfactory receipt of goods or services paid for by means of a money transfer.
* Never share details of a money transfer with a third party to prove the availability of funds. Doing so may enable the money transfer to be paid to that third party. This is known as a ‘Proof of Funds’ fraud.
Many people become victims of fraud due to a relationship they have over the Internet. This may be persuasive selling or a long term ‘honey-trap’ romance lasting months.
The advice is simple: Never send money to, or share details of a money transfer with, somebody that you do not know.
What is the best way to protect my Reloadit Pack money?
Reloadit should ONLY be used to reload your prepaid cards or for accounts that YOU control.
Beware of deals or opportunities that seem too good to be true.
Beware of any offers that do not accept a Visa or MasterCard payment and asks for you to purchase a Reloadit Pack where you provide the Reloadit Pack number in an email or over the phone.
Never use a Reloadit Pack to pay for taxes or fees on foreign lottery winnings, grants, or any offer that requires you to pay first before getting something back.
Beware of websites requesting Reloadit Pack numbers as payment.
Remember: Guard your Reloadit Pack like cash! Transactions cannot be reversed, so only give the number to a trusted recipient. Blackhawk is not responsible for the quality or non-receipt of any goods or services
No government department, official, employee, agent or diplomat; No court of law, lawyer, solicitor, attorney, barrister or law firm; No local, national or international law enforcement agency; No lottery, promotion or charity; No shipping, courier, or escrow company; bank or financial institution, or similar company, no matter what country it is in, including, but not limited to, the FBI, Interpol, Economic Financial Crimes Commission (EFCC), World Bank, United Nations, International Monetary Fund, Federal Reserve Bank, United Postal Service, DHL, Federal Express, United Parcel Service, MoneyGram, Western Union, Bank of America, ING, Prudential, Central Bank of Nigeria, PayPal, CllickandBuy, Yahoo, Amazon, etc. everrequests payment of any cost, fee, or charge, via WU/MG. No real company or government of any kind will ever request money via WU. If that ever happens, its a scammer impersonating that company or government.
Legit Online Stores Do Not Request Payment via WU/MG
Any online "store" or "company" that only accepts, demands, encourages or even mentions payment via WU and/or MG should be viewed as a scam as no legitimate business would have such a payment policy.
Counterfeit Check Scammers Depend on WU/MG to Run Their Scams
Never accept a check or money order from an online stranger or company for any reason, deposit it in your bank account, and when it "clears", wire money back to the stranger or anybody else using WU/MG. It is a scam! The check/money order will always be fake! The scammer hopes that the fake is good enough to fool the bank long enough for it to make the funds "available". Just because the funds are "available" does not mean that the check has actually cleared or is genuine. The funds are only made available temporarily until the check/money order is verified. If you withdraw the cash and sent it via WU/MG to the scammer, the money's gone. When the bank finds out the check/money order is fake (in the U.S. they have a year to do this) they will debit your account for the amount of the check/money order and turn the fake over to law enforcement. At best, your account will be closed or frozen and your credit could be affected, at worst you could be prosecuted for attempting to cash a fake check. See: http://www.fakechecks.org
Scammers Can Collect WU/MG Transfers Even Without Full Or Real Identification Information
Never agree to send money via WU/MG to a relative or friend and then send a partial copy of the receipt or some of the information about the transaction to a third party "to prove" that you actually have the money; or send money via WU/MG to someone and send a partial copy of the receipt or some of the information, withholding the rest until they perform their part of the deal. A scammer can claim the money with minimal information or identification, even if the money was not actually sent to him or her and they will!
WU/MG Allows Scammers to Pick up Money in Any Country Regardless of What Country it is Sent To
Just because you send money to the U.K. or some state in the U.S. doesn't mean that it is necessarily picked up there as a scammer in Nigeria could pick up that money. WU/MG both allow a international money transfer to be picked up in any country not just the country the transfer was sent to.
WU/MG Allows Scammers to Receive Money Anonymously
WU and MG are well designed for scammers to receive money which is why, perhaps 90% of scammers request money via those methods. Sending money via WU/MG is like giving cash to a stranger on a street corner, having him leave and then hoping he will reappear with whatever goods, services or money he promised you...only its worse because you never even see the stranger and he is hundreds or thousands of miles from you! In many cases, minimum or no identification is required to claim money sent via WU/MG, just the MTCN number, and in some cases that number is not even necessary, just knowing who the money was sent to. You have no assurance the money was retrieved by the person you sent it to and in the case of a scam the person gave you an alias.
A person can get money sent via these services and remain anonymous which is essential to any scam and why they use free email addresses, free classified advertisements, free domain websites, pre-paid mobile telephones and personal forwarding numbers . As stated by the FTC, once the money is sent, its impossible to reverse the transaction and there are corrupt WU/MG agents and franchises who cooperate with scammers by allowing them to claim money without proper identification for a percentage of the “take.” This was one of the reasons WU and MG were sued.
Never Use WU/MG To Pay Someone You Don't Personally Know
Basically, anybody who is not a known relative or close friend who requests money via WU/MG or any other money wire service such as Coinstar, is a scammer, or should be treated as such. Sending money to friends or relatives is the only legitimate reason to use WU/MG.
Many scammers, especially electronic good scammers, pet scammers and romance scammers, will attempt to tell you that they are not strangers because you have exchanged emails, instant messages or telephone calls. They are still strangers, regardless of such interaction.
A stranger, for the purposes of WU/MG is someone you have not physically met and/or have not independently confirmed to be who they state they are. Scammers will tell you that WU/MG is a fast and efficient way to send money, which it is…for scammers! They will tell you that in their country WU/MG is the normal way of doing business, and/or that sums under a certain amount must be paid by WU/MG. Both of these statements are false. They will tell you that other people pay by WU/MG all the time. If those people did, they were scammed. They will probably come up with other similar excuses for you to pay WU/MG.
Scammers will also send you various picture identifications, such as passports, driver's licenses, visas to "prove" their identity so they are not strangers. These are all invariably fake or forged! No legitimate person or businessman would send you his or her passport or driver's license to prove his identity. Only scammers do this.
The more a stranger insists that its okay for you to pay them via WU/MG, the more they are confirming that they are a scammer.
Filing a Fraud Complaint Will Not Get Your Money Back
WU/MG are designed to send cash with very few, if any questions, asked. It's not their responsibility to make sure that you are not defrauded or that you get whatever services or goods you paid for. There job is to send cash to the person you tell them to send it to and that is what you are paying them for. Though, as part of the settlements both WU/MG are supposed to do a better job of alerting their customers about possible frauds, ultimately its up to you to protect yourself. Thus, you can, and should file a fraud complaint, so that WU/MG is at least alerted to the fraud , however, WU/MG fulfilled their obligations once they sent the money and don't expect them to "bail" you out.
Credit Cards Are the Safest Way to Pay For Goods Online
Some scammers posing as "stores" or "companies" will tell you that payment via credit cards is risky. That's untrue. You can dispute a charge on a credit card and have the amount chargebacked or adjudicated fraudulent. That option is not available with WU or MG.
However, in entering your credit card information in any online payment form on a website you must make sure that you are on a SSL secured connection Either look for a lock icon at the bottom of the screen, in the status bar of your browser. If the site is secure, the lock will be closed. If website address begins with https:// - the 's' indicates the site is secure. If the lock is not closed and the website address does not begin with https://, the store or company is not authorized to accept credit cards and is just phishing, i.e., stealing your credit card information. See Shopping Online Safely.
You are not protected by your credit card chargeback provisions if you pay via WU/MG using a credit card. The transaction is considered a cash advance which does not have the protections a credit card purchase does.
Some online stores or companies will indicate that they accept credit cards, however, when you actually attempt to use these methods of payment you will find that they are not available for various reasons, e.g., their banks are under audit or their banks only accept credit cards for payments above a certain amount.
Bank to Bank Transfer / Telegraphic Money Transfer
Do not send money via Bank to Bank transfer to make a purchase in an online transaction when you are dealing with a person or company you don't personally know, have never done business with before or have even the slightest question or concern as to their identity or legitimacy!
Doing so leaves you open to be scammed! Bank transfers are extremely difficult, if not impossible, to reverse because the bank's position will be that you authorized the transfer even if that authorization was based on fraud! In fact, all bank wire agreements say precisely that. Frequently the scammer will withdraw the money as soon as it is wired into his account. Some scammers will fulfill small orders based on a bank to bank transfer to build trust and when the victim makes a larger order, they will not delivery the merchandise and keep the money.
Many scammers will want you to transfer money to a bank account which is in the name of a totally unrelated individual or entity than who the scammer claims to be. Sometimes the scammer will claim that the individual is an employee or director who is in charge of receivables which is why the money is to be paid to his or her's account. No real company or government uses an individual's bank account to collect money that is due to the company or government. The fact that an employee is responsible for tracking payments to a company does not mean that payment would be paid to that employee's individual bank account! If you owe WalMart, you don't send a check to some WalMart employee, you send it to WalMart. The bank account the scammer has given you either belongs to a fellow scammer or someone collecting the money on behalf of a scammer for a cut of the "take." Sending money via bank to bank transfer is not much safer than sending it via Western Union/MoneyGram. The same rules that apply to Western Union/MoneyGram apply to Bank to Bank Transfer. Never send money to someone you don't know using that method. Never use that method of payment to pay for any item purchased online.
PayPal has strict conditions on whether or not they offer Buyer Protection or will reimburse you for an item which is not delivered or is substantially different than what you ordered so make sure you meet the requirements. It is in no way "automatic!" They will only reimburse you for "certain tangible, physical goods" which does not include:
1. Intangible items, including Digital Goods
3. Real estate, including residential property
5. Vehicles, including motor vehicles, motorcycles, caravans, aircraft and boats
6. Custom made items
7. Travel tickets, including airline flight tickets
8. Items prohibited by the PayPal Acceptable Use Policy
9. Items which you collect in person, or arrange to be collected on your behalf
10. Items that violate eBay’s Prohibited or Restricted Items Policy
11. Industrial machinery used in manufacturing
12. Items equivalent to cash, including prepaid or gift cards
13. PayPal Direct Payments
14. Virtual Terminal Payments
15. Personal Payments
For example, if you pay for pet delivery or document translation or resume preparation, those would be considered services which are not covered, even if you are scammed.
There are other conditions you must comply with to get reimbursement:
Send the payment to the Seller through:
*the eBay “Pay Now” button or the eBay invoice; or
*the “Send Money” button of your PayPal account by selecting “eBay Item” and entering your eBay User ID and the eBay item number for purchases on eBay website; or
*the Send Money tab on the PayPal website, by clicking the “Purchase” tab, or by selecting the “Checkout with PayPal” button or otherwise selecting PayPal as part of a Seller’s checkout flow.
For example if you simply send the money to somebody's email address, that would not be covered. Consequently, if you pay for an item using PayPal it is always better to use a credit card because the chargeback provisions of your credit card are stronger than PayPal's Buyer Protection and have less requirements and restrictions. It is very important that you review all of Paypal's Buyer Protection provisions. See: Section 13 of the PayPal legal agreement.