Online Sales Scams

Fraud Alerts


With the popularity of online marketplaces on the rise, so is the risk of fraudulent sales by social media scammers. In fact, more than a billion users buy and sell goods on social media marketplaces each month and 90% of shopping scam victims report they were scammed through Facebook or Instagram in 2021 alone, per the Federal Trade Commission (FTC). 

Unlike eCommerce sites like eBay or Amazon, social media marketplaces have a lot more direct conversation with sellers — increasing the risk of accidental transactions with a scammer. Since these scammers can be quite convincing, below are some tips to spot one in action.

Popular Online Sales Scams

  • The Seller wants to communicate outside of the marketplace platform. With this approach, the seller has more control over how payments are processed, which increases the chance that your financial transaction with them cannot be reversed and/or recovered. This also allows any correspondence to continue without monitoring via a social media platform.
  • The Seller wants to mail you items instead of scheduling a convenient time to meet up to exchange goods in person. With this approach, the risk of never receiving your 'purchased' items after payment is complete increases significantly. It's always best to meet in person before transactions are complete to allow for the inspection of goods before payment is finalized.
  • The Seller requests advanced payments. With this tactic, a seller may pressure for an advanced deposit due to 'high demand' or to 'secure your spot'. For instance, many scammers posing as legitimate dog breeders online may require you to put down a deposit and then you will never hear from them again.
  • The Seller sends you an item that doesn't work or is outdated/incorrect. This type of scam most often happens with tech devices, like computers or phones. Sometimes you will pay for an item that was advertised as brand new or a newer model than what was exchanged. Occasionally the purchased item won't even turn on or work properly. Once exchanged, the seller disappears from the marketplace leaving you with no options since the sale and exchange are final. 

Stay Protected Against Online Sales Scams 

  • Do as many of your online transactions through the online marketplace as possible. Using the official platform and shipping methods of the marketplace might provide better protection for you and your money if you fall victim to a scam.
  • Research your seller prior to communication. Check their profile for things like negative reviews, no reviews, or them being a net-new seller on the marketplace. 
  • Meet the seller in person prior to payment. This will allow you to inspect and confirm the correct item and that it is functioning properly prior to you providing payment. For additional safety measures, make sure you meet this person in a public, well-lit environment. 
  • Never pay for an item before receiving it. If possible, try to only provide payment for an item when you receive it in hand or when you receive a legitimate tracking number for its shipping. 

TowneBank offers several ways to stay protected against online scammers:

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Only deposit products are FDIC insured.

The information provided is not intended to be legal, tax, or financial advice or recommendations for any specific individual, business, or circumstance. TowneBank cannot guarantee that it is accurate, up to date, or appropriate for your situation. Financial calculators are provided for illustrative purposes only. You are encouraged to consult with a qualified attorney or financial advisor to understand how the law applies to your particular circumstances or for financial information specific to your personal or business situation.

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