Notes On a Scam (Part 2) aka Little Friday is Little Business Day

So, as mentioned in last week's first small business post, Baby Tattoo fell for the I'll Send You Money For Books Plus Shipping Then You Forward The Shipping Money To My Freight Person scam. Baby Tattoo ran a credit card, got an approval, wired a big chunk of the money to a third party, then the credit card number turned out to be stolen (or something else sinister) and the merchant bank will almost certainly require that the full amount of the credit card transaction be refunded after the wired money is long gone. Bob Self, who should have noticed the situation was extremely iffy, simply didn't think this one through. He also didn't do his internet fraud homework. There is a well-organized page at craigslist.org that clearly explains the basic form of this scam; if you sell anything online, read the warnings here.

A couple of notes:

In Baby Tattoo's situation, the false funds came from a credit card, not a money order or cashier's check. The credit card approval obtained through Baby Tattoo's online merchant account created a false sense of security. A credit card transaction (even an "approved" one) can be just as bogus as a fake check, so be cautious with out-of-the-ordinary, non face-to-face (i.e. "card not present") transactions.

In Baby Tattoo's situation, the instigating communication was not a single email; it was a series of emails that started off unsuspicious then added the questionable aspects a little at a time.

And here's a little useful lingo that Baby Tattoo learned the by way of multiple frantic phone calls. If you call a credit card issuing bank's fraud/security department about a suspicious transaction, you need to ask if the card in question is, "Still open." The issuing bank will probably not give you much of any information about the card or the cardholder (which is frustrating if you are trying to uncover a fraudulent payment), but if you ask specifically if the card is open, they will probably be able to tell you, "Yes" or "No." Obviously, a card that is no longer open indicates a problem.

You are probably thinking, "Duh." Well, just remember that the easiest people to fool are often people who think of themselves as hard to fool.

Note: The Fool image used at the top of this post was found deep in cyberspace. Baby Tattoo does not know who the copyright should be attributed to. If copyright information becomes available, this post will be updated appropriately.

More small business information will be posted next Thursday.