Marketplace scams: How to protect yourself

Online marketplaces have become popular platforms where people can buy and sell their own goods. However, if you enjoy online shopping and bargaining, you’ve probably also heard of marketplace scams. They are becoming more common both in the UK and around the world.

In this guide, we’ll explain more about marketplace scams and how to avoid them. We’ll cover some of the most common types of scams, how to report them to Wise and what we’re doing to fight scams.

What is a marketplace scam?¹

Marketplace scams are a type of fraud taking place at an online marketplace. These scams involve deceptive practices and they can be conducted by both buyers and sellers.

Some platforms where these scams are possible are Facebook Marketplace, TikTok Shop, Instagram, eBay and many others.

Types of marketplace scam to watch out for

Here are some common marketplace scams you might want to look out for:

Fake payment confirmation scam²

A common type of marketplace scam is a fake payment confirmation. If you’re the one selling something, a scammer might send you a false email with a supposed payment confirmation. In reality, no payment has been made, and they want you to send them the item for free.

Shipping scam³

If you’re the buyer, a shipping scam could involve the seller falsely claiming they’ve sent you the items you paid for. On the other hand, this also includes buyers asking you to ship an item before they’ve sent you the money.

Phishing scam⁴

Online marketplaces are also a common source of potential phishing. The goal of phishing scams is to steal your personal data and information. If the person you’re communicating with is asking you for more info than they would usually need, this is a red flag.

Counterfeit scam⁴

A well-known scam that is particularly common on Facebook Marketplace involves selling counterfeit or damaged items. If you're the seller, it may also happen that the buyer gives you counterfeit currency when you meet.²

Rental scam³

Rental marketplace scams involve scammers creating fake property listings with the goal of luring people into paying deposits or rent money. Another version of this is hijacking actual rental ads and requesting a fee to view a property or offering lease-free properties.

Fake giveaway scam³

Giveaways on platforms designed for buying and selling are often fake. These are typically a gateway to data theft, as you'll likely be asked to fill out a form with personal information.

Verification code scam³

In general, never agree to share a verification code with anyone you don't know. These marketplace scams often start with the scammer claiming they need to verify your identity before doing business with you. If you encounter someone like this, make sure to report them to the marketplace platform.

How to spot a marketplace scam or online shopping scam⁴

Consider if it’s too good to be true

Identifying marketplace scams begins with your intuition. If a listing seems too good to be true, it most likely is. Scammers either set very low prices when they’re selling or offer to overpay when they’re buying.

Urgency

Also, any kind of panic or urgency is usually a bad sign. You have the right to take your time while shopping and scammers know that acting quickly leads to more mistakes.

Pay attention to the details

Lastly, make sure you carefully look at the photos of the item you’re buying. If you feel like you can’t see its condition very well, make sure you ask for more pictures. If the seller can’t provide them or avoids your questions with vague answers, you’re likely dealing with a scammer.

How to avoid getting scammed: Facebook Marketplace?³

To stay safe on Facebook Marketplace, try to use Facebook Messenger for communication. If Facebook needs to intervene and help you with a scam, they may not consider conversations that take place outside the app.

Aside from this, stick to safe payment methods, avoid too-good-to-be-true deals and don’t communicate with high-pressure buyers.

How to avoid getting scammed on Instagram?⁵

Whether you’re shopping through Instagram or via another platform, you should always follow the basic rules of online shopping. For instance, try not to buy from new shops without ratings.

Before rushing into a purchase, do some research online about the company. Often, other people will have left reviews or written about their experience on forums, you can use this to inform your decision. Only make a purchase if you’re sure the company or seller is legitimate.

You should also try to avoid flash sales or closing down sales (especially if you’ve never heard of the company). In both cases, these can be tactics to create a false sense of urgency and encourage shoppers to be impulsive. They’re often promoted by aggressive sellers who try to trick you into buying their items.

How to avoid getting scammed on TikTok Shop?⁶

Try to avoid buying certain items, as they don’t undergo the same safety checks. For example, if you’re purchasing electronics, you might end up with appliances that don’t even work.

The same rules apply to TikTok Shop as to other marketplace platforms. You should question offers that sound too good to be true and stick to secure payment methods.

📚Read: TikTok Shop payment methods

How to protect yourself from marketplace scams

Although marketplace scams are becoming more frequent and increasingly sneaky, you can still protect yourself to some extent.

This starts with never giving any money before seeing the item you’re buying. For instance, you can ask the seller to send you more photos or even agree to meet you in a public place and show you the item in person. You could even ask them to send you videos to ensure the photos aren’t stolen from someone else.

When it comes to payment methods, always rely on trusted, secure options. If someone offers to pay you with gift cards in exchange for the items you’re selling, insist on being paid through a more reliable method. Payment options other than cards or cash can easily be faked.

Also, always double-check your account balance to confirm the money has actually been sent. If the buyer wants you to send the items before paying, never agree to those terms. Payment first, items second.

What to do if you’ve been the victim of a marketplace scam?⁷

In case you become a victim of a marketplace scam or suspect you’ve been scammed, don’t reach out to the potential scammer, instead, simply report the scam as soon as you can.

Checklist

• Report the scam (e.g. Facebook Marketplace lets you file a dispute)
• Contact Action Fraud (run by the UK police)
• Let your financial provider know as soon as you can

It’s a good idea to document each interaction on these platforms, in case you end up needing more proof.

How to report a marketplace scam to Wise

If you suspect that you’ve been a victim of a marketplace scam, there are a few steps to take in reporting this to Wise. This should be done immediately if you’ve been scammed by a Wise user, if someone made a payment using your Wise account or if you are a Wise user who has fallen victim to a scam.

You can file a report easily via the Wise app. We’ve outlined the steps below, but you can read the detailed Wise help article on this topic for more information.

1. Login to your Wise account
2. Select the transfer from your activity that you want to report and it will bring up the transaction
3. Select the question mark symbol "?" on the top right hand corner
4. Depending on the type of transaction, you'll see some options:

• I’ve submitted a dispute. When will I hear back?
• I want a refund
• I was charged multiple times
• I don’t recognise this
• Something else

In most fraud cases you will want to select “I don’t recognise this”.

However, in a marketplace scam, where you have made the purchase, it is best to select “Something else” which will bring up the following contact options:

• Chat
• Phone
• Email

1. Select your language from the drop down menu and your preferred form of communication, and then provide us with as much information as you can to report your scam.

We'll get back to you as soon as we can. However, get in touch with us if:

• You have difficulties using the above self-service flow
• You’ve been scammed by a Wise user
• You believe somebody else made a payment using your Wise account

Once you have reported the scam to Wise, you can file a police report if you haven’t done so already. Wise will always help the police with their investigation when they reach out to us.

Things we'll never ask our Wise customers to do

If you are contacted by Wise, we will never:

• Ask you to pay deposits to unfreeze your money
• Ask you to put money into an account in order to ‘re-activate’ it
• Ask you to move your money from your main account, to a ‘safe’ account
• Create an account on your behalf, using information you send us, or make payments or transfers on your behalf
• Ask you to download software to allow us to make payments via your device

How Wise works to protect customers from scams

Now that we’ve covered the essentials of marketplace scams, you should know how to recognize them better and protect yourself.

Wise also does everything to protect you from all types of fraud, including marketplace scams. Our security operations team continuously runs vulnerability scans to safeguard your money and data, while two-factor authentication adds an extra layer of protection for all transactions.

We’re also on a mission to educate our customers on the different scams to watch out for, including impersonation scams. Learn more about Wise’s recent scam campaign activity.

Useful resources

In case you’re worried about impersonation scams, here are some useful resources you could look into:

• Action Fraud
• How to Stay Safe When Using Wise
• Take Five to Stop Fraud
• Take Five to Stop Fraud
• Citizens Advice
• CIFAS

Sources used:

1. Sift - marketplace scams
2. The Times - common marketplace scams
3. Norton LifeLock - Facebook marketplace scams
4. F-Secure - Facebook marketplace scams
5. How-to-Geek - Instagram shopping scams
6. AiThority - TikTok Shop scams
7. Aura - getting scammed on Facebook Marketplace

Sources last checked on date: 06-Nov-2024