Buyer/Shipping Scams

Overview:
Buyer/shipping scams are the most common scams that hit artists. The scammers prey on artists who are eager for a sale, and move quickly before the artist realizes they've been duped. This is typically used for anyone selling goods online, but the scammers have been targeting anyone selling ad-hoc items, typically in online marketplaces.

Target:
Any artist with a website, online profile, or selling art online. These scams typically happen more often around the holiday season, around November to February.

Warnings:

  • The buyer is in one location, the art is going to another location, and the money is issued from a third location
  • The buyer has their own shipping company or private shipper----one you've never heard of before
  • The buyer wants to move quickly and issue you a cheque, money order or bank draft from a bank you've never heard of before
  • After the sale, the buyer suddenly falls victim to a horrible life event and needs the sale refunded

How it works:
  1. The scammer trolls artist websites, artist profile websites and online art markets/galleries for artists.
  2. They will typically pick artwork which is priced highly, is heavy or awkward to ship.
  3. The scammer will pose as a buyer, asking to purchase the work.
  4. The scammer will offer to take care of the shipping themselves, though their own shipping company or private shipper.
  5. They will often, but not always, say that they will pay you for the shipping and the art, and ask you to reimburse the money to their shipping company.
  6. The shipping cost will almost always be disproportionately higher to a standard courier or even most specialty art couriers.
  7. The scammer is not interested in getting your artwork or sending someone to your home or studio.
  8. The scammer will very quickly send you a cheque, money order or bank draft
  9. After you have confirmed that you have cashed the payment, the scammer will tell you that they have had a horrible life event--- a death or illness in the family, falling victim to a natural disaster, or even needing the money because of an unexpected pregnancy.
  10. The scammer will ask you to refund the money right away to deal with their new life issues.
  11. You will have a valid cheque, money order or bank draft sent to the scammer, feeling sorry for their situation. Because the shipping company doesn't exist, they never picked up the artwork and you don't have a problem with refunding the sale
  12. The scammer receives your cheque and cashes it
  13. Your bank realizes that the cheque, money order or bank draft from the scammer is a fake and removes the money from your account
  14. You have now lost the money, with very little recourse for recovering it!

Why it works:

  • People selling wares online are typically very excited to make a sale, especially if their sales are low
  • People are generally understanding of life events where large purchases need to be refunded
  • Banks will credit your account the amount of money deposited before validating the funds from your cheque. This can take more than three weeks, and the cheque doesn't always get validated even if you go to a teller.
  • The scammers are international, and with the scam happening across many countries. Because of legal jurisdictions, your local police can't do much with it; because of the small amounts of each scam, this isn't a priority for organizations such as Interpol.
  • The scammers use free email addresses, and most of these hosts just can't keep up with the complaints. By the time the scam has happened, the email address has been abandoned and the scammer is using a new email address and name.

How to protect yourself:
  • If you are being asked to ship an item, always use a known courier company. If you are being asked to use a company you are not familiar with, provide the client with similar alternatives that are less expensive and provide the same protection for the safe delivery of the artwork. Any legitimate buyer will be open to saving some money as long as the art will arrive safely and is insured.
  • Request payment via a credit card. Online payment options like Pay Pal provide both buyers and sellers with added protection, and you can process the purchase via email. Although they will take a percentage of your sale, you will be safer in the long-run and bank fees should be considered part of your operational costs. Any legitimate buyer should be open to paying via credit card, because it also provides them with recourse if their item doesn't arrive.
  • If you do take a cheque, explain to the buyer that you will not ship the item or refund the money until the money is fully cleared. This will typically scare away any fake buyers and encourage real ones to pay with a credit card.
  • If you do take a cheque, explain its origins to your bank teller and ask to have a hold on the funds until the cheque clears. Ensure they understand that you do not want to be at risk if this is a scam. They should be fully aware of this type of scam. If you have problems, speak to the bank manager. Do not be afraid to make it an issue---just remain calm and professional!
  • Have a separate phone number for business. There have been horror stories of scammers calling people at all hours of the night, making threats and demands for their "money" to be returned. VOIP and cell phone numbers are inexpensive to maintain now, and keeping a separate phone line for business is a good way to keep your business and personal life separate anyway.
  • Always conduct yourself professionally
  • Do not be afraid to lose a sale. Even if they are a legitimate buyer, would you want to do business with someone who is not willing to negotiate the sales terms with you?