Tricks of the Trade: How Fraudsters Try to Scam You out of Your Hard-Earned Money

Tricks of the Trade: How Fraudsters Try to Scam You out of Your Hard-Earned Money
If your business has ever been hit with a fraudulent payment, you know how painful it can be. Here's a list of methods they might use and how you can prevent it.
by Square Jun 23, 2017 — 3 min read
Tricks of the Trade: How Fraudsters Try to Scam You out of Your Hard-Earned Money

If your business has ever been hit with a fraudulent payment, you know how painful it can be. Fraud occurs when a buyer uses stolen credit card information to get free goods or services. Merchants can be held liable for these charges, which means you could be out the goods or services, your time, and the payment.

Fraudsters employ social engineering techniques (aka the practice of manipulating folks into divulging personal info) to earn your trust and get you to run charges you normally wouldn’t.

The examples in this article came from one fraudster’s interaction with a small business owner. (We’ve changed all names and personal details, of course, to protect identities.) By the time it was all said and done, the merchant was scammed out of thousands of dollars. Of course, there’s no silver bullet for detecting fraud, but you can arm yourself with the knowledge to stop it before it goes too far.

6 social engineering tactics and other clues

1. Typos on typos

It can be difficult to discern if someone is simply trying to use slang, shorten their communication, or speak a second language. Fraudsters may be non-native English speakers or may deliberately place typos into their communication because they want to seem informal or uneducated. Their communications often have misspellings, misuse of capitalization, or words you may not be familiar with:

Hello This Adam i will like to know if you do deck installation and do you Accept credit card??

2. They give you a sob story

Fraudsters like to pull at your heartstrings. It’s tough to tell fact from fiction, but they may pretend to be in dire straits or feign a sense of urgency to get you to let your guard down.

Right now Am presently in recuperating from the diagnosis of lung cancer and am still in the hospital. But want to get things done asap.

3. They ask you to wire or transfer funds to a third party

Fraudsters may ask you to run additional charges on your Square account and then provide cash to a third party, such as a real estate agent, driver, or even a wedding coordinator. The third party is actually the fraudster; it is a ploy to get more money.

I need your assistance to help charge an extra $5000 for my Agent as his commission dbalance on my property, We have to make this payment before we can start the project.

4. They ask you to ship bulk orders to addresses that don’t make sense or to use their private shipping company

Fraudsters may ask you to use a shipping company that you’ve never heard of to ship a large order of valuable goods to an address that does not match the billing ZIP code of their card.

Thanks very much for the quick response back with the QUOTE which I gladly accepts… International Shipping fees USD 1,600 (advanced Paid via Western Union cash wire)

5. They use multiple credit cards with varying ZIP codes

To get around detection, fraudsters like to split large payments into smaller ones, use multiple cards (that often get declined), or use cards with varying billing ZIP codes. They may claim to have insider knowledge of Square’s processes, which simply isn’t true.

Process first card for $900 and second card for $540. Square will not authorize big amount on my card so follow my instruction so we wont have issues paying the Agent fee. We will process more funds tomorrow.

6. If it sounds too good to be true, it probably is

Is it the biggest sale you’ve had in months? Is your customer offering to pay you a commission or tip to wire funds? Are they offering to pay for Square fees? Be wary!

I will like to add $200 as tip for yourself for errands and stuffs

What to do if you’re being scammed (or you think it could happen)

If you think someone is trying to scam you, stop engaging with the fraudster. Don’t reply to anything. If you’ve already provided some information, the first thing you want to do is contact your payment processor and let it know.

One of the ways you can prevent fraud is to work with partners like Square that place importance on protecting your business and your customer data. Look for payment providers, for instance, that offer things like fraud detection, dispute support, and PCI compliance.

That way you can focus on what’s important: running and growing your business.

The Bottom Line is brought to you by a global team of collaborators who believe that anyone should be able to participate and thrive in the economy.


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