The email scam that costs you thousands

Would you respond to an email that promised you £50,000?

Imagine you run a small business supplying really hard to find items. Perhaps you sell spanners that fit pre-metric nuts, or parts for nineteenth century clocks, or personalised horse blankets.

There are literally thousands of companies like this – and they rely on internet orders as you can't find this stuff on the high street. In many cases, these firms make items required – a chainwheel for the 100 year old bicycle an enthusiast is restoring - if they can't find it in their specialist stock.

You probably enjoy doing this. You have to, as supplying these items will never make anyone rich.

Typically orders will be small - rarely more than £500 if that - and usually preceded by detailed enquiries. For example, sometimes the broken item or a drawing arrives by post. Buyers know orders may take time.

Then suddenly, an email arrives in your inbox from someone wanting to place an order for £50,000 or £100,000 worth of goods, several hundred times your typical order, and maybe months' of business. And the payment is promised upfront with a credit card. Your first instinct will be to cheer and break open the champagne.

Don't. It's almost certainly a scam. And if you respond, you could end up losing thousands of pounds in cash as well the cost of sending out materials.

How the scam works

The seller receives the £50,000 order but is shortly afterwards asked for a “discount” as the order is so large. But then story changes. The “buyer” is willing to forego the discount provided the order is sent by the fastest means possible. And in order to facilitate the equivalent of first class air freight in the country the “buyer” claims to be, you have to send money – perhaps £5,000 – via Western Union, Moneygram or a similar cash set-up.

“But don't worry,” you're told. “We'll add this to the total and send you a banker's draft first for the new amount. Banker's drafts are as good as cash.”

You send the cash. When the draft arrives, you bank it. Then you send the goods. But a few days later, your bank tells you the draft is forged. So you lose your cash. The items will never be collected and may even find their way back (with more freight charges).

There are variations, of course. But in the main, it's no different from those overseas offers to buy the car you're advertising for more than you want where you send the car and cash as well in return for a draft that bounces. This scam can be used for any large-value moveable item.

How to spot this scam

Tell-tale signs include orders many times greater than normal, “customers” who don't have much idea (if any) of what you sell or attempt to talk about it, and the initial credit card promise (no normal customer tells you about payment methods – they want to know about the goods first).

Other danger signals include:

Sense of urgency – capital letters, demands for fast delivery and the promise of higher payments for speed
Tortured English including broken sentences
No address or phone number for items that will need to be delivered
Use of easy to get email address such as hotmail, gmail or ymail when the size of the order suggests it would come from a commercial entity.
Destination address is unlikely – who would want £50,000 of clock parts in Vietman or Venezuela
Convoluted explanation of why the goods are needed.

Lack of your name in the letter or anything specific about your particular goods – the scamster will send out thousands of emails so will not tailor them for your particular offering. However, sharper scammers will work their way through trade directories so they may say something general about the goods you sell.

So remember the old adage (slightly adapted). If it looks too good to be true – and orders one hundred times the average certainly are – then it's bound to be a scam.