Australian Institute of Criminology

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Online shopping and auction frauds

The theme of the 2013 National Consumer Fraud Week is online shopping and auction frauds. Accordingly, participants in the 2012 survey that had been exposed to, or been victimised as a result of, scams via these mediums are discussed in this section. Although this was not a specific scam category included in the survey, there were numerous inclusions in the ‘other’ scam category that revealed scams had been attempted or undertaken on online shopping or auction sites.

There were 496 respondents who reported they had received a scam categorised as ‘other’. Of these, 112 (22.6%) reportedly took place on an online shopping or auction site. Fifty-three respondents reported that they had been contacted by a scammer when advertising their vehicle for sale, 38 when advertising other items for sale, 10 when purchasing products online and 11 did not provide specific details.

Vehicle sales

Almost half (47.3%, n=53) of the scams that took place on online shopping and auction sites involved the sale of a vehicle. In addition to cars, it was reported that scammers had targeted boats (n=3) and motorcycles (n=3), as well as one trailer and one caravan. Where respondents had provided details of the scams, they followed similar themes. These typically included:

  • an overseas buyer;
  • the buyer wanting to see the vehicle sight unseen;
  • being offered a larger amount than what was advertised;
  • being requested to pay an agent or courier/shipping service fee, with a promise that this would be reimbursed; and/or
  • a fake remittance notice being sent advising that a payment had been made to the seller’s account.

Examples of responses that were provided by survey respondents included:

An attempt to purchase a car, unseen, for a larger amount than asked. Refused to call, all correspondence via email after initial SMS.

Have motor vehicle for sale on website, twice approached to pay ‘broker’ on their behalf.

Hoax car purchase—request to txfr courier fees before receiving money for car.

Offer to purchase used car that I am selling, sight unseen, offering more $.

Purchase of second hand car saying they don’t need to see it as they trust me.

Selling a car online…money sent for transfer and payment to a third party.

Twenty-three respondents included in their response the website that they had been using to advertise their vehicle. Nine different trading sites were mentioned, one of which account for over half (n=12) of the reports.

One respondent advised that they had lost money as a result of a vehicle sale scam. The amount lost was $1,000, which was reportedly transferred to an ‘agent’ using a money transfer service. A further six respondents revealed that they had disclosed personal information to the scammer.

Sale of other items

Thirty-eight participants reported that they had been targeted when selling other items, excluding vehicles, online. In addition to being targeted through auction sites and trading post sites, it appeared that small business owners who operated their own websites were being targeted. Products targeted in these scams (where specified) included furniture, pets, electronic and computer equipment, and wine. The main methodology employed by scammers appeared to be similar to that used for the vehicle sale scams, in that they posed as an overseas buyer, requested transport fees be paid for by the seller, offered to pay more than the item was advertised for and sent fake remittance notices advising that a payment had been made. However, buying sight unseen was not mentioned as being a red flag for the sale of other items, probably because by contrast with selling vehicles, this is normal practice when purchasing items online. The following illustrates the types of responses received:

Buyer responding to online ad—offering to pay more than listed price with instructions to wire excess funds overseas.

Prospective buyer of my for sale item wanted money transferred to them in advance of sale.

Purchase goods from me to be sent with their chosen shipping company to Asia and they want to pay in full by credit card. Chosen shipping company does not accept credit cards.

Purchasing of an item I had for sale to transfer money to pick up agent in UK.

To purchase goods from me by credit card payment and have me pay their international freight invoice on their behalf.

Another scam variation was as follows:

African company placing order for goods and paying by credit card. Later cancelling and asking for a cash refund and ‘take out 10% for your trouble’.

Twenty-five respondents indicated the site they had advertised their products on. In total, three sites were mentioned and of these, one accounted for 21 (84%) of such reports. This site was the same one that accounted for the majority of vehicle sale scam contacts.

Three respondents advised that they had sent money as well as their personal information as a result of being scammed in this way. The amounts reportedly lost were $800, $900 and $760. Seven respondents revealed that they had disclosed personal information only.

Purchasing goods

Ten respondents indicated that they had been exposed to scams while purchasing products online. While three respondents did not provide specific details about the type of scam they had received, two reported that they had found counterfeit items offered for sale and another two found products that would not offer the advertised benefits; one of these respondents reported a loss of $20 for the purchase of a ‘useless product’. Two respondents reported that they had purchased computers and electronic goods online that had never been received. The financial losses were $400 and $560, and both reported that they had also provided their personal information. Another respondent supplied his personal information to an advertiser, but did not purchase the product after being supplied with false information about the seller.

Other unspecified online shopping and auction frauds

Eleven respondents indicated that they had been exposed to online shopping auction frauds, however did not provide specific details. These were mainly identified by the respondent naming an online shopping or auction site. One respondent reported the loss of $68 and their personal information as the result of an ‘online shopping scam’.

A further two respondents reported they had experienced financial losses from online auction sites, with the amounts totalling $493 and $600. Three respondents reported the loss of the personal information only from internet trading sites.