Avoiding Frauds, Scams & Rip-offs on Craigslist

Craigslist is a lot like a worldwide classified section -- it allows users to post items for sale, services needed, even personal ads for friendship and romance. Unfortunately, the giant online marketplace is also home to flagrant accounts of fraud and ever-evolving scams that attack both buyers and sellers.

If you are considering buying or selling anything on Craigslist, you should be aware of the fraud that's out there so you know how to stay safe and protect yourself. Today we explore several of the biggest and most common types of fraud on Craigslist and show you what to look for to see the con men coming.

There Is No 'Buyer Protection' on Craigslist

Conning people on Craigslist isn't as easy these days as it used to be. The amount of information out there on scams has caused many shoppers to become more keenly aware of the games people play, and has made some people unwilling to shop on Craigslist at all. To overcome these fears, some con men assure the buyers that they will be protected by the site's "Buyer Protection" program.

The specifics of how the program is supposed to work vary -- some scammers write their own bogus contract and claim it to be from Craigslist, others lie and say they have an escrow account that will hold the money until the buyer confirms that the product is to his or her liking, but the scam here remains the same. FraudGuides reports that there is no formal purchase protection offered by Craigslist, and anyone telling you otherwise is just trying to dupe you into wasting your money on their scam.

Don't Be Led To An eBay Account

Sometimes con artists are after more than just your money, and they seek to steal your identity as well. These fraudsters list items for sale on Craigslist and wait for interested buyers to contact them. When they get an email from a prospect, they send along an eBay link and tell them that the product is actually for sale there due to the extra security eBay provides. When the buyer clicks the listing link, they are actually taken to a phony clone of an eBay page and asked to log in. This is a classic phishing scheme -- as soon as the person logs in to see the item, his or her account details are captured and emailed to the seller.

These con men use the multitude of stolen eBay accounts they receive to list fake items and scam more people, all under the hijacked usernames of innocent people. Because the fraud is spread among so many different, unconnected accounts, the actual scammer is extremely hard to locate and is able to continue the fraud unabated.

Don't Take a Money Order

Money order scams are some of the easiest cons to fall for on Craigslist. These scams are unique in that they attack the seller, not the buyer (usually the buyer is the intended victim, hence the unofficial Craigslist slogan "Buyer Beware.") At first the offer seems too good to pass up -- a buyer contacts you and tells you that he or she is willing to buy your item for even more than you have it listed at in exchange for paying with a money order.

This is enough to excite most sellers, especially when they mistakenly believe they'll be fetching $500 for an item listed at $300. Unfortunately, Craigslist advises all sellers that this is always a con. When the money order arrives, it is quickly found to be a fake, and the bank you cash it at often holds you responsible for the mishap.

Stick to Local Sellers

Before you send a complete stranger hundreds or even thousands of dollars based on a nice sounding advertisement, you should make an effort to visit him or her and check out the item in person. This is especially true for big-ticket items such as cars and houses -- blemishes and problems with such property can be easily covered up through clever photography. If the seller lives out of state, or refuses to meet you in person at your request, play it safe and look elsewhere. The last thing anyone wants is to buy a classic car for tens of thousands of dollars, only to find out it doesn't have an engine when it arrives.

Never Pay By Wire Transfer

A lot of Craigslist shoppers worry about the safest way to pay for a purchase from a seller. The absolute safest way is to pay in person and get your item on the spot, but this isn't always an option for some people. If you cannot commit to buying only from local sellers and decide you'll your chances with an over-the-Internet transaction, avoid getting involved with anyone requesting you pay by wire transfer.

A wire transfer cannot be canceled or reversed once it is sent out, leaving the buyer with no real options except to eat the loss if the seller doesn't send the product in return. Scammers know that other secure payment systems (such as the popular PayPal platform) have arbitration systems in place to retrieve funds for buyers who have been conned, which is why not accepting such a payment method is a sign of danger.

Be Very Careful with Personals

The Craigslist personals section is jam packed with fraud. As ScamBuststers say, "If there's an easy sell in this world, it's the illusion of a potential hot date to a young single male." Rare and isolated incidences of serial killers and prostitutes aside, by far the most common scam Internet daters need to be on the lookout for are affiliate marketers posing as single, attractive females. These shiesters will post fake descriptions and pictures, and try to push anyone who contacts them into signing up for pornography or paid dating websites.

After some casual emailing to convince the victim that they are really talking to the hot lady from the ad, she mentions wanting to go on her webcam or share some naughty pictures on her "other website." The victim is then sent an affiliate link to sites like AdultFriendFinder, and once they sign up, the "single young female" they've been romancing is never heard from again.

About the Author: Sheena Freestone is a freelance writer for FundingUniverse. Funding Universe matches qualified entrepreneurs to banks, investors, and other funding sources. Funding Universe helps small businesses avoid scams and rip offs by securing funding from trusted national banks and financial institutions.