Fraud on the Internet during the sale of goods

We all buy something, and in one way or another we interact with people online whom we don't know at all.

This article will be useful for buyers who don't want to fall into another trap, and for sellers to understand how not to act so that you are not perceived as a dishonest person.

Most scams involve small amounts of money: the goods are mass-produced, there is little noise, deceived buyers often do nothing, and the police are reluctant to take on such cases. Therefore, fraudsters rely on inaction, and that the deceived buyer will simply give up.

The most common platforms for fraudulent sellers to «work» are Instagram, olx, and Facebook groups.

Scammers exploit human weaknesses:

Greed, the desire to get unprecedented benefits or something for free. Dishonest «sellers» use large discounts, significant price differences, and arguments such as «this is the price at the old rate, you're lucky!» They also use imaginary winnings of expensive goods, which, of course, must be paid for.

Gullibility. Scammers regularly impersonate other people or organizations. They create multiple accounts, pretending to be the seller that naive customers want to see. 

Fear. Fake sellers use fear to force buyers to act quickly and without hesitation — a limited offer, «this product was asked for, now I'll see if it's still available, buy it quickly before it's gone».

Naivety. Flashy banners, offers of unprecedented benefits, links to one-page websites, photos from photo stocks — this type of manipulation is aimed at those who are just starting to use the Internet. 

Curiosity. Criminals use clickbait — attractive offers or intriguing messages — to lure customers or install malware.

Laziness. Many buyers would rather not spend time and energy checking information about the seller. This is one of the main reasons why people fall for fraudulent schemes.

The desire to make money. A drop-shipping scheme from fake sellers when they promise quick and easy money by selling mass, branded, popular goods. Scammers use various schemes — pyramids, intermediation, the need for investment — to force the victim to invest money.

The desire to look good in front of others: scammers can use the desire for social recognition to convince a customer that they should buy something expensive to appear better than others.

Lack of knowledge or experience: scammers use incompetence in a particular area, such as financial advice, or an offer to invest in a new technology or product.

Sympathy and pity. Unscrupulous sellers often manipulate sensitive topics to increase the number of «purchases» of goods by using motivations to buy, such as «% of sales — to the Armed Forces», volunteering or charity.

Self-confidence. People who think they are too smart to fall for fraudsters' bait or too savvy to be targeted may let their guard down.

10 common online fraud scams

There are 10 common fraud schemes that criminals use when selling goods online.

 Fake online stores: Fraudsters set up fake online stores to get money from customers without shipping the goods. These fraudulent sites usually have unrealistically low prices, no contact information, and limited product information.

 Counterfeit goods: Fraudsters can sell fake goods by passing them off as original. They use photos and descriptions of real products to mislead customers.

 Inadequate price: «sellers» offer goods at unrealistically low prices to attract buyers. 

 Full or partial refusal to send goods: fraudsters may take money for goods but never send them, or send goods of poor quality that did not match the description.

 Non-delivery of goods after prepayment. For many sellers, prepayment for goods is a protection against unscrupulous buyers who do not pick up the goods at the post office. Knowing this, buyers agree to the seller's terms and make a partial or full prepayment to the seller's card. Fraudsters actively use this habit: they demand an advance payment for the goods, but at last, they do not send anything, and the buyer is simply blocked in all messengers and social networks.

 Identity theft: fraudsters may ask customers for their personal information, such as credit card details or passport photos, and then use this information to steal personal funds or apply for loans.

 Phishing and account takeover: The «seller» sends a link to pay through a supposed online store, tricking users into entering personal data and bank card details on a fake website. 

 Fake reviews: fake positive reviews are used to confirm the legitimacy of the page and the allegedly shipped goods.

 Misrepresentation of information about goods: the seller provides inaccurate or misleading information about the description of the goods, their condition, or value. Buyers receive goods that do not match the descriptions provided. To sell low-quality goods, landing pages are often created — websites that contain one page about one product.

 Drop-shipping fraud: In this scheme, the seller sells overpriced goods that are not in stock. After the buyer places an order, the seller buys the goods from an authorized dealer or elsewhere and arranges for delivery directly to the buyer. The buyer may receive goods that differ from the advertised ones or receive goods for which they need to pay again, but to the real seller.

How do you know if a seller is a fraud?

Some signs that the seller may be a fraud:

 Low prices. If the price of an item seems too low, it may be a sign of fraud. Suspiciously low prices may mean that the seller is selling a fake product or has no intention of shipping the item after receiving payment.

 Huge assortment. If there are any sizes or configurations in the ad or on the website, you should think about it because either the product is not really available, or it is supposed to be made to order, and the quality may differ significantly from the picture.

 Unusual payment method: if the seller requires payment, for example, via a link on a suspicious website or by transferring funds to a phone account.

 Lack of contact information: if the seller does not provide contact information, this may be a sign of fraud, a means of not allowing themselves to be identified. Check the seller's website, there should be a phone number, email address, or physical address. 

 No reviews: if the seller has no reviews from previous customers, this may be a sign of a newly created «business».

 Incredible promises: If the seller promises something that seems too good to be true, such as very fast furniture production and delivery.

 Language. The law on language came into force on July 16, 2019. All experienced sellers know that the service must be in Ukrainian, as well as the website and product description. Therefore, fraudsters often give themselves away by unceremoniously starting correspondence in Russian, as the law does not apply to them, or they simply do not know about it.

 Lack of systematic work: failure to fulfill the promised — they promised to call but did not call, payment to a bank account, but «currently you need to pay on a card because I am not in the office right now».

How to check the seller before buying something?

 Check the seller's reputation: use a Google search to find reviews and comments about the seller. Also, be sure to check the phone number and card number on Facebook.

 Look at when the account was created, how many entries there are on the page, and whether there are any reviews.

 Check the seller's profile: honest sellers have an open profile. Look through the comments, pay attention to negative emoticons, sometimes they are there for a reason.

 Check the seller's card: if you have a card number, check which bank it is from. Then, through the application of this bank, look at the full name (sometimes it shows only the first name and the first letter of the surname) — they must match the profile name. You should be wary if, for example, the profile is for a woman, but the card is in a man's name and vice versa (unless it is a seller you have bought from many times).

 Check the physical address: if the seller claims to have an offline store, try to verify its authenticity by finding the store on Google Maps.

 Contact the seller: before making a purchase, try to contact the seller to ask questions and get additional information about the product. This will help you understand how serious the seller is about their business.

 Check licenses and certificates: If the seller claims to have any licenses or certificates, try to verify their authenticity. Usually, this information should be available on the seller's website.

 Use secures payment methods: payment through a LiqPay or to an official bank account.

 Check the photo of the product: most often people are deceived by beautiful photos from AliExpress.

If the photo is available only on Chinese or other foreign websites, and the product is not available in Ukrainian stores, it is highly likely that such a product simply does not exist.

Liability for fraud in 2023

Fraud is the misappropriation of another's property or the acquisition of a right to property by deception or breach of trust (Article 190 of the Criminal Code of Ukraine).

In 2023, the tax-free minimum income was changed to UAH 2,481. Accordingly, the limit of administrative liability has been increased to UAH 268.40, and criminal liability for fraud is triggered from the amount of UAH 268.41 or more.

To bring a person to criminal liability for fraud, the investigation must prove that the person intended to misappropriate the property and not fulfill his or her obligations at the time of seizure.