How to Spot a Craigslist Overpayment Scam

Few can dispute the fact that the Internet has given many people unrivaled opportunities for commerce. Platforms such as Craigslist provide an opportunity for anyone who wishes to exchange goods for money to do so. Unfortunately, like any system that involves humans, there are bad-faith actors who would take advantage of what’s allowed on that platform to their own nefarious ends. This means that Craigslist users should be aware of the most common tricks that such crooks use to part honest people from their hard-earned money.

Users should know that there are potential pitfalls, and how to recognize said pitfalls – and, by all accounts, one of the most common Craigslist scams is the so-called “Craigslist Overpayment Scam”.

How the Craigslist Overpayment Scam Works

The mechanism of the Craigslist Overpayment Scam is pretty simple.

  1. Fraudsters will contact an honest seller of a relatively expensive item about the offer and seem to agree to the deal.
  2. The seller will then receive a cheque or money order for the item, but for an amount much larger than the asking price.
  3. The fraudster will then ask the seller to either return the difference between the sums via a bank transaction or pay the difference to a third party, which is then to perform some sort of service related to the transaction – for instance, deliver the item, pay customs fees, etc.
  4. The seller will send the money, and possibly the item, to a new owner.
  5. The bank will not clear the check, because it was fraudulent all along.
  6. The seller has now given an amount of money equal to the “overpayment,” and possibly parted with their expensive item as well.

It is, in essence, a check scam.

Tips on Ways to Avoid Craigslist Overpayment Scams

  1. Use payment processors that guarantee the safety of your transactions, and can reverse payments from any party that may commit a breach of conduct. PayPal is an excellent record when it comes to payment security and user protection – though doing business through PayPal means that you’ll have to pay commission fees to the company.
  2. Beware of buyers who breach the agreement, a.k.a. Send more money than you’re asking for. If you receive a suspicious cheque or money order that is more than the agreed amount, refuse the payment, then proceed to send it back to sender.
  3. Refuse money orders. If you must use a cheque and always request a certified cheque.
  4. Keep in mind that until it is cleared by a bank, a money order or a cheque is just a piece of paper – no more, no less. Any funds that you may receive in this form are not the same as cash and must be treated with caution before they are cleared and settled.
  5. As a customer, you are personally responsible for the items you deposit in your bank account. If the item is returned as fraudulent, you are liable for the full amount, as the depositor.
  6. So, if you ever find yourself in doubt about what a potential Craigslist buyer is trying to sell you, or if the situation seems untoward in any way, refuse to deal with the “buyer,” as he might well be a con artist.
January 14, 2020

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