Escrow Wolves in Sheep’s Clothing

The word unscrupulous does not go far enough to describe those who seek to gain by others’ misfortune or bad luck; we have to add words like devious, deceitful, cunning, and not least of all merciless and cruel.

Predators

For this is the world of praying on the innocent and unsuspecting; and worse even, perpetrating fraud in the guise of help. What, indeed, could be more contemptible?

This is the world where the weary online buyer—well read by now about online auction frauds and false promises—to safeguard his money turns to an online escrow service to make sure that he receives and approves the merchandise before his funds are released to the seller.

He Googles "Online Escrow" and is met with a host of sites, one seeming more legitimate than the next. He reads the "about us" carefully, and as much of the fine print as he has time or mind to absorb. Finally settles on one: Integrity Escrow.

He establishes an account, and his email is verified by the site, over a secure https link. So far so good. Seeing the https and the little security symbol in his browser makes him feel warm and fuzzy.

He then provides the details of the transaction, and, as a final step, deposits the purchase amount—in this case $3,500—in his newly established escrow account.

And that, as the saying goes, was the last he saw of that money.

Impersonating the Solution

Turns out Integrity Escrow was nothing but a slick impersonation of a bona fide escrow company, established—normally in China, Russia, or the former Eastern EU—for the sole purpose of stealing your money while pretending to do the exact opposite, i.e., preventing theft.

Did I say unscrupulous? Yes, it is a step down from out and out theft; it is stealing in the guise of helping.

Unfortunately, online escrow fraud is escalating, due to factors such as:

• Online identity/credit-card theft

• The Anonymity of the Internet

• A lamentable lack of public awareness about fraudulent escrow sites

• Web hosting companies that allow fraudulent escrow sites to be created with stolen credit cards, and then allow them to remain on their service even after they have been reported.

To this I would add an increasing number of tech savvy criminals with zero concern for their fellow man.

How Do They Do It?

Luckily—for the Fake Escrow Detective—those who set up fraudulent escrow sites are, as a rule, lazy people, who wouldn’t (probably couldn’t) create original copy if their lives depended on it. No, too much work.

Lazy people normally resort to templates, made to order scam sites (which abound as well) where they go to download a respectable site. As for trust-inducing copy, few sites are better than bona fide online escrows, such as Escrow.com, which is where they go for the words.

Voila: A new online escrow site.

The Detectives

The fraudulent online escrow detectives have seen this all before, and many, many times. They recognize the templates; they recognize the words.

And so they should, because those words are normally stolen from their own sites—these private eyes are normally employed by the bona fide escrow companies to search out, track and close down as many fraudulent sites as possible.

The Hunt

I asked one of these detectives, Brandon Abbey of Escrow.com, how they find out about the fraudulent sites.

"There are a couple of ways we hunt down the fraud sites," he said.

"Quite often someone calls our customer support department to inquire about a particular site. In this case, the site is reviewed and if fraudulent a notice is sent to the hosting company.

"The note to the hosting company is a request for them to review the site giving consideration to their Terms of Service (TOS) and Acceptable Use Policy (AUP), and it usually results in the takedown of the site.

"Some hosting companies, however, take the stance that they are not responsible for the content on their servers regardless of what it is. There are specific laws that address certain things like child pornography but nothing we can point to regarding the escrow fraud."

What if nobody calls you? I wondered. How do you track them down?

"Often we Google a word-string (phrases) taken from our own site, and you’d be surprised how often we get hits. This means we’ve found a fraudulent site which came to us for the copy.

"Now, when we find a fraudulent copy of our site we can send a Digital Millennium Copyright Act (DMCA) notification to the ISP and that usually works.

"The main problem is that the ISPs are afraid of someone suing them for shutting down a site. The reality is no one has ever been sued by a Romanian scammer.

"We have also built a library of templates, which we can track down; as well as a library of phrases that we Google.

"On a good day (or bad day, depending on viewpoint) some of these searches will come return over a hundred matches. We then inspect each site to see if it is legitimate. If suspicions we forward the notice to the hosting company asking for a TOS and AUP review.

"As you can imagine some hosting companies are better than others. Generally, hosting companies in the US are very responsive.

"Xinnet, on the other hand, a hosting company in China, has supported some of the scam sites for months at a time."

Valuable Advice

How can, I wondered, the average Internet user protect him- or herself against online escrow fraud?

"Of course," said my detective, "it is important that people do research on these site before ever sending money or merchandise. In fact, I suggest doing a WHOIS search on the domain. This way you can discover how long the site has been up, where it is being hosted, how many times the site has been taken down. These are clues.

"If it smells fishy at all to you, go elsewhere."

Safeguard Your Money

It is your money. Handing it over to a cyber criminal probably has not yet made it onto your top-ten list of what to do with it.

There are many great deals online. There are many great auction houses online. There are bona fide online escrow sites, but nowhere near as many as there are fraudulent ones.

Do all the online research you can. When you have found a site that seems legitimate, you can do one of several things:

• Firstly, while fraudulent sites can buy the necessary certificate to make it a secure site, they seldom do;

• Secondly, you can check at escrow-fraud.com to see if the site you have decided on is listed as a fraudulent site by them; they also maintain a list of bona fide sites;

• Thirdly, you can call the site’s customer service department to make sure they are based in the United States. If you have any doubts about that, ask them to call you back, and check the caller ID—if it’s an international call, beware. Also, if the site does not have a customer service department, again, beware;

• Once you know that you’re talking to a U.S. based service department, ask any questions you can think of to ensure they are legitimate, such as which bank are they using for their escrow accounts, and who is their main contact at that bank (whom you can then call to verify that this online escrow company does in deed have an escrow account there);

• If the answer is a well-known American bank, and if the customer service rep can supply contact information at the bank, you are 99% there. Then, if you want to reach 100%, make that final call to the bank to rule out any vestige of doubt.

Now you have found an online escrow company you can trust.

Enjoy your purchase.

P.S. Escrow.com is an online escrow company you can trust.