How to detect and avoid PayPal Scams

Whether you want to kick-start an online business or want to do safe online shopping, PayPal unquestionably is one of the most secure and convenient platforms. Since its inception, PayPal has been the de-facto way to send/receive money online. Although PayPal is a very dependable service, scammers still manage to spot the loopholes and escape roads to dodge PayPal’s anti-scam defenses using cheap tricks.

Let’s face it, PayPal scams do occur, and scammers should trick you if you regularly use this platform for online transactions. With this blog, we aim to bring to your notice a few ways scammers cheat people on PayPal and how you can avoid PayPal scams.

Avoid PayPal Scams

Criminals are obstinate, but you can avoid falling into their scam traps by being proactive and knowing what to watch out for. Be aware of these most common PayPal scams.

Advance Fee Fraud
Email Scam
Display Name Spoofing
Fake Charities
Overpayment Scam
Shipping Scams
Employment Scam.

Let’s look at all these PayPal scams in detail:

1] Advance Fee Fraud

As humans, we are very cautious about strangers on the street, sadly in the online world, we aren’t that cautious. One of the most common PayPal scams users should be cagy of is ‘Advanced Fee Fraud’. Here fraudsters will request you to send some smaller amount (for legal documentation, taxes, etc.) before they can transfer your millions – The truth is these irresistible offers are scams.

You may receive an email with a subject line in ALL CAPS claiming you’ve won a legacy. When you open such emails, you may find an official letter from someone in a high political position telling you that you’re an insane amount of money for some phishing reason. What happens next? You are asked to provide some basic information that explicitly opens up the lines of communication. Ultimately, the scam successfully collects your personal information and can be used in identity fraud while also grifting money from victims.

How to avoid – Don’t rope money to someone you don’t know. A legitimate prize won’t require you to pay a sum to receive it.

2] Email Scam – “Your Account Is About To Be Suspended” Or “Problem With Your Account”

Another PayPal scam comes in the form of emails; many scammers send hoaxed emails warning indicating an account is about to be suspended or there is some issue with the account. The account holder is tricked into opening the email and clicking on a link that directs them to a phishing website. Furthermore, the victim should enter their PayPal account password in the spoofed webpage.

How to avoid – PayPal is never going to ask you to enter your login details unless you on their login page. Report any suspect email by forwarding it straight to spoof@paypal.com. Also, it’s a good idea to change your password frequently.

3] Display Name Spoofing

Also known as “friendly name” scams, fraudsters utilize a feature of the email systems which lets the sender’s display name to hide behind a “friendly name”, which makes it looks very genuine. Cheats can easily fake the “friendly name” in the sender’s email address. For example, an email can look like coming from “PayPal Services,” but be from sqz7@twomail.com.

How to avoid – Open the suspected email, but NEVER click any links in the email. Also, hovering over the display name in the email will display the real email address so you get to know if it’s a hoax.

4] Fake Charities

Fraudsters tend to play with victims’ emotions, too; in a few cases, these can include tricking kind-hearted people into donating to bogus charities. Many fake charities pop up from nowhere following occasions of a refugee crisis, a terrorist attack, or a natural disaster (like an earthquake, flooding or famine). In such fraud events, these charities may have a fake website, or they simply send information over the web – ultimately asking victims to pay through their PayPal accounts.

How to avoid – Before making any donations, check the charity’s background. For verifying charities, PayPal itself recommends using one of the following websites:

http://www.charitynavigator.org
http://www.bbb.org/us/charity
http://www.charitywatch.org

Note if you cannot verify the charity through any of these options, it is expected to be fake.

5] Overpayment Scam

PayPal vendors should be concerned about this scam. What happens here?

The vendor sells a product/service to an individual/business
The buyer makes a payment but sends more money
The buyer then requests the vendor to return the difference

But the catch here is that this time the buyer wants the refund to a different account.

How to avoid – A legitimate buyer will never overpay you for an order. If a customer overpays you and asks for a refund for the difference, consider canceling the order and do not ship the product. And never return the money to a different account.

6] Shipping Scams

The shipping scams occur in two ways, service scams and address scams.

Shipping Service Scams:

The buyer can ask you to use a specific shipping service. They can claim that they have a preferred vendor who is more reliable or they can get a discount. In all certainties, they can easily contact the shipping company and reroute the order to another address and later file a complaint about not receiving the item at the original address.

How to avoid: Use only your shipping account and review and validate the buyers’ address before shipping the product.

Shipping Address Scams:

Here the scammer tempts you to make a delivery to a different address other than the registered one with PayPal. They will make the payment through their PayPal account, but the item needs to be delivered to a different address. Once the item is delivered, these scammers will open a dispute that they never received the product.

PayPal security guidelines mention clearly that you should never deliver an item to an address other than the one it is registered with on PayPal. This platform takes no responsibility for the delivery of goods that have not been delivered to the address registered with the buyer’s PayPal account. Now even if you provide a shipping confirmation receipt, PayPal will not do anything about it.

How to avoid – Never deliver an item to an address other than the one it is registered with on PayPal.

7] Employment Scam

This occurs when someone offers you to be their partner or employee. They ask you to trade products on eBay or a website, pay their supplier, and update your PayPal account address to their address. Such fraudsters can conduct fraudulent transactions and hold you liable.

How to avoid – First thing, verify such suppliers. Never pay on behalf of someone you don’t know and never update your PayPal account address to someone else’s.

Read: How to create a personal URL for PayPal payments.

Detect Fake PayPal Emails

While the above-mentioned PayPal scams are the most common ones, you must know that numerous fake emails are being frequently used to cheat users worldwide. Today there are hundreds of ways fraudsters can use fake emails to cheat people. But following basic email scam prevention rules can help in the prevention of these dodges. Below are some clues that can help detect fake PayPal email scams:

An email from PayPal will always come from paypal.com and not support@paypal.com.
Phishing emails will ask for confidential information, like bank details, PayPal login details, full name, your security question’s answer, and other similar information which can be exploited.
PayPal emails will never contain attachments and will never ask you to install or download anything.
PayPal emails will always address you by your first and last names or your business name.
Scam email content creates a sense of urgency. For example, “Click now to get $100 coupon” or “We have noticed wary activity in your account; click the link below to confirm”.

Always make sure your email spam filters are turned on; this will automatically put emails from unknown sources into junk/spam folders. Also, when you receive emails from any suspicious emails, instantly add them to your block senders list.

Last Words

In the case of fraud, your best option is to contact PayPal.com directly. PayPal offers fraud protection for all buyers and sellers who utilize their service. If you believe there is a mismatch in your transaction or any fraudulent activity, report it to PayPal within 60 days. The company will investigate the issue and verify the information.

It is also very important that you keep track of your PayPal account, even if you don’t use it that often. Log in securely once a while and check the history of your payments; also, make sure you create a very strong password to help secure your account. Even though PayPal is the most trusted payment service on the Internet, there are ways around its security that can lead to a breach.

Now since you know how these scammers operate and the tricks they use – Be careful!

Speaking of scams, some of these links are sure to interest you: