Tips for Spotting Escrow Fraud

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Escrow companies can be helpful in completing a transaction safely but make sure you are using a legitimate escrow company. Here are a few tips to help you choose a good company.

Don't be talked into using a particular escrow service
Be suspicious of using an escrow service recommended by an online buyer or seller. Be sure to scrutinize the site carefully before using the service. When the seller directs you to an escrow site of their choosing, that's a warning flag. Don't assume that because a company has a website that it is legitimate.

Call customer service
Call an escrow site's customer service number. Not being able to get a live person on the phone is a big red flag. If you call and get a fax or a generic voice mail that says leave a message, than it's probably a scam. Don't use any escrow service that doesn't list an address or phone number. Get on the telephone and converse with folks and verify their credentials."

Verify and then trust
If using an on-line escrow company, verify any and all endorsements and credentials on an online escrow site. Are those really TRUSTe, Better Business Bureau and VeriSign Secure seals on an escrow site? Be sure to check.

Study all licensing information carefully. Contact any licensing authority listed on the escrow company website and verify that the site is actually registered. Check this information carefully. Many scam sites have ripped off the legitimate license numbers from other companies.

You'll also want to check when an escrow site's domain name was registered. Many scam escrow sites say they've been in business for years but only have been registered for a few days or weeks. You can use a "Whois" tool at any domain name registrar, such as or, to find out.

Steer clear of escrow sites with sloppy content
A sloppy Web site is probably a scam. Spelling errors, grammar problems, inconsistent information or broken links are good indicators that an escrow site is a scam.

Of course, a great website is no guarantee an escrow service is legitimate. A flashy, flawless escrow site could still be a fake.

No matter how good an escrow site looks, be sure to verify all claims and content.

How you pay could be a tip off
Take a close look at how an escrow site asks you to pay. If an escrow site asks you to make a payment to an individual or agent rather than a corporate identity, it's a scam. A legitimate escrow service will never ask you to send your money or your product to the other party.

Beware of escrow sites that use person-to-person money transfers such as Western Union and MoneyGram. Western Union is not affiliated with any escrow service.

An escrow company on the up and up will ask you to wire money from your bank to their bank. They'll provide you with a routing number and account number.

If you wire money to an escrow service, ask your bank to tell you where the wire transfer is being sent.

Do a search
Search for the escrow site on Google, Yahoo, or another search engine. If your search turns up zero results, be wary. If your search turns up consumer complaints about the escrow site, avoid doing business with the site. Again, just because the site does show up is not guarantee that it is legitimate.

Be wary of "safe" and "secure" online escrow companies
Scammers love to use those words "safe" or "secure" when naming scam sites. A dash in an escrow company's name, such as, is another red flag. The dash seems to show up in many phony company names.

Avoid escrow sites with Web addresses that end in "org." A legitimate escrow service would never try to pass itself off as a nonprofit organization. You'll also want to avoid escrow sites with Web addresses that end in ".biz", ".cc", ".info" and ".US".

Don't be blinded by a super deal
Many phony escrow sites place phony ads on Internet auction and classifieds sites. These ads promise potential buyers and sellers unbelievably good deals. 

If the price on a motorcycle seems to be way under market price there is a good chance it really doesn't exist. .

Another tip off is when you send an e-mail to a buyer or seller and you get a scripted, "Dear Sir" response, referring you to an escrow site that they've used many times.

And if a seller offers to pay shipping and insurance on a really big item, that's another red flag that the deal may not be on the up and up.

Watch out for copycat sites
Many scammers copy the content of real Escrow sites. These sites may use a similar name or domain mane to confuse you. Make sure you are on the correct site. Call the customer service and verify. Watch out for companies that claim to be "affiliated" with legitimate company. Don't use an "affiliate." Use the real company.

Watch out for fake e-mail
scam_e-mail.gif (32897 bytes)Take a look at this e-mail. (click on the image at the left to enlarge) This is an actual e-mail sent by a scammer.  He tried to pass it off as coming from "Square Trade" as an escrow service. First of all "Square Trade" is not an escrow service. Look closely at the e-mail. You'll notice it looks rather official looking. The scammer tries to make it look like you are sending your money to safe location. It even displays a "Trust-e" seal to make you believe it is secure. Look at the payment information. "Square Trade" is not the recipient.  The instructions are actually telling you to send the money directly to the scammer. In this case knowing that "Square Trade" is not an escrow company is a dead giveaway, but similar e-mails could be sent pretending to be real escrow companies. Always contact the escrow company directly. 

Note: TRUSTe® is an independent, nonprofit enabling trust based on privacy for personal information on the internet. The Trust-e logo shown on the e-mail sample was placed there by the scammer. We duplicated the logo along with the e-mail to show how scammers misuse the logo. It is not meant to signify that is associated in any way with Trust-e and have long lists of known escrow fraud sites on their Web sites. lists screen shots of common escrow scams.

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