PayPal scams come in various forms, such as shipping address, overpayment, fake email, phishing, hacked PayPal, and fake accounts. To protect consumers from scams, it is important stay informed and keep checking each stage.
PayPal platform remained popular among consumers for years due to its long-standing reputation for security and reliability. Generally, the platform is regarded as user-friendly and easy to navigate.
However, PayPal is not immune to fraudulent activities and disputes. Staying informed and watchful is essential to protect oneself from these fraudulent activities. Mark Wright, an anti-money laundering expert at KyrosAML.com.
Wright tells Digital Journal about the various types of PayPal scams and provides practical tips to avoid falling victim to them.
Shipping Address Scams
According to Wright: “One scam that has become increasingly common is the shipping address scam. It starts with a seller receiving an order and payment for an item from a buyer. However, before the item is shipped, the buyer contacts the seller and requests that the item be shipped to a different address. The unsuspecting seller agrees and sends the package to the new address.”
“After several failed delivery attempts, the seller realizes they have been scammed. The shipping company flags the order as undeliverable, and the buyer contacts them with a new, valid shipping address. The seller is left with no proof of delivery since their transaction detail only shows the original, invalid address.”
To avoid falling victim to this scam, Wright recommends: “Always double-check the shipping address before sending out the item and consider talking to your shipping company about implementing measures to prevent customers from redirecting orders.”
Overpayment Scams
PayPal is a widely used payment platform for online transactions. Here Wright warns: “Scammers have found ways to exploit the system by overpaying for an item and asking for the excess amount to be returned. They later claim that their account was hacked and demand a full refund from PayPal, causing the seller to lose money.”
Wright explains that overpayment scams are easy to avoid: “Sellers can choose to only accept payments through the checkout system instead of direct payments through PayPal. If direct payments are necessary, sellers can protect themselves by refunding the entire purchase and requesting a new payment for the correct purchase amount.”
Fake Email Scams
With this fraud, Wright finds: “Scammers send sellers fake PayPal emails claiming that funds are on hold until a shipment tracking number is provided. PayPal does not withhold money in this way, but the scammer hopes that the seller will send the item and tracking number to receive payment.”
In terms of the impact: “This scam can result in the seller shipping an item without receiving the payment and later discovering that PayPal never held any money for them. Some scammers may even create convincing copies of regular PayPal sales emails to deceive sellers.”
Further, Wright cautions: “This scam doesn’t involve PayPal’s systems, so they cannot protect sellers from it. To avoid getting scammed in this way, check your records to ensure you shipped an order, and don’t rely solely on emails.”
Phishing Scams
In phishing scams, a seller receives an email that appears to be from PayPal, asking them to confirm a pending fund transfer by clicking on a link or button. Wright explains the conceit: “If the seller enters their login information into a fake PayPal site, the fraudster can use them to access the seller’s actual PayPal account and make payments or withdraw funds.”
Another recent PayPal scam includes scammers asking for a small payment for processing fees or documentation with the promise of a big financial return. With this, Wright adds: “Meanwhile, fake SMS messages claim that your account has been compromised and ask you to click a link to reset your password. These links actually lead to fraudulent websites designed to steal your information.”
To avoid these scams, Wright says that it is essential to practice good cybersecurity habits:
- Always verify the email address an email was sent from, and don’t click on suspicious links or download any attachments.
- Never enter personal information into a webpage that was linked to you; rather, log into PayPal or other websites by typing in the URL yourself.
- Never call a phone number provided in an email; instead, manage any PayPal issues online by logging into your account from a secure device.
Summing up, Wright concludes: “To avoid all PayPal scams, it is crucial to double-check the shipping address, only accept payments through the checkout system, be aware of red flags, and practice good cybersecurity habits. By following these tips, sellers can protect themselves from fraudulent activities and disputes on PayPal”.
