The ANZ Bank has alerted Federal Police to a new scam targeting people who use online classifieds to sell products. Generally perpetrated by overseas criminals, this scam is different because it targets sellers, not buyers.

In this scam, the fraudulent buyer sends the seller a cheque for the goods which is far more than the price, and by taking advantage of the slow pace of international cheque clearing, scams the seller out of thousands. The seller receives the cheque, and then the buyer claims to have made an innocent mistake, and rather than delaying for another cheque to be sent, asks the seller to transfer the extra money via Western Union or other electronic service back to the scammer, or to a third party like a shipping company.

As a result, the seller has transferred a few thousand dollars in some cases in instant, cleared and untraceable funds, and then, some six weeks later, the Australian bank informs the seller that the cheque they originally recieved with an inflated price has bounced completely.

While this scam is not a result of the internet, it is the ability for buyers and sellers from all over the world to interact that has led it to occur. The main piece of advice is to practice the same rules as the banks do – when recently paying for some services in Hong Kong for an upcoming trade show, we were interested to realise that the Commonwealth Bank wouldn’t accept a credit card to make a bank to bank transfer, requiring fully cleared funds – in our case, cold hard cash.

To read about Matthew McBride, who was targeted in this scam when selling his bike online, check out the Sydney Morning Herald article at http://smh.com.au/articles/2005/03/15/1110649163329.html.