Skip to main content

How to Spot and Avoid Third-party Seller Scams

As more and more transactions take place online, a growing concern is the rise of third-party seller scams on popular marketplace websites. These are schemes devised by some independent sellers to defraud shoppers and can involve sellers offering fake products or even instances of no products arriving. Say you’re shopping for a pair of new shoes from your favorite brand. A seller on a legitimate website has the style and size you want at a great price. When they finally arrive, they’re not what you’re expecting and you suspect they may be an imitation. Or, maybe you pay and the shoes don’t arrive at all and the seller isn’t responding to your messages. This, unfortunately, is a common type of fraud. Our latest Consumer Pulse survey revealed 28% of fraud victims were targeted by third-party seller scams, making it the second most popular scheme, ahead of stolen cards and even identity theft.

The Office of the United States Trade Representative (USTR) acknowledged it can be difficult to discern scams on legitimate websites, as “consumers are unknowingly exposed to counterfeit and pirated goods in settings and under conditions that make the articles appear genuine. Consumers are often shopping from the safety of their homes through mainstream online markets that provide an aura of authenticity and trust.”

Below are some tips to help you avoid these kinds of online scams, so you can feel more confident as you shop.

Beware of deals that seem too good to be true

It’s always smart to shop around to find the best deal, especially for pricey, big-ticket items. After you comparison shop, you’ll have a good idea of a competitive price for the product you’re looking for. If you see a seller is offering a product that is priced substantially lower than others, it’s worth doing additional research into the seller before purchasing. This could be a sign of faulty or counterfeit products not matching your expectations.

Check for reviews

Of course, steer clear of products and sellers with overwhelmingly poor reviews. But it may not be enough to know that a product has good reviews. It’s smart to take a critical eye and actually read reviews as well, even if they are mostly five stars. As you do, ask yourself these questions:

Are the text reviews generic?

Some fraudulent sellers may use fake reviews in an attempt to trick people into thinking it’s a legitimate listing. If most of the product’s reviews are basic or don’t discuss specific aspects about the product, it should give you pause.

Do reviews match the product being sold, or do they seem to be describing another product?

On occasion, fraudulent sellers may edit a listing from one product to another, taking advantage of positive reviews already in place from a different product altogether. This can help their fraudulent product rank better and ultimately be seen by more consumers.

If reviews seem confusing or don’t answer concerns about the product you’re looking for, it may be best to find another seller.

See if the seller is “partnered” with the marketplace

Some online marketplaces will grant a type of status for certain sellers if they’re known to deliver reliable service. This is a way for sites to reward their top-performing sellers and help them build trust with customers. You can usually see an icon or badge for trusted sellers on the product or seller’s company page. Top-rated sellers typically adhere to the marketplace’s expedited shipping option for members as well. A seller that has been acknowledged by the website as top rated or partnered is less likely to be a scammer.

Other tips to stay safe from website scams

The Federal Trade Commission has a list of additional tips to help you stay safe while shopping online. These include noting sellers’ refund and return policies, as well as making sure to pay with a credit card when possible. Credit cards tend to have better purchase protection than alternative payment methods. The Fair Credit Billing Act allows you to dispute certain credit card billing errors, which includes charges for goods not delivered as agreed.

When in doubt about the legitimacy of a seller, it’s best to choose another option. Of course, not all third-party sellers are using fraudulent tactics or counterfeit products. Most are hardworking, legitimate small business owners you can trust. Even still, it’s important for you to do your due diligence and take a few extra moments to research third-party sellers, especially if something seems amiss. For more tips, TransUnion has additional fraud victim resources and you can check out the FTC’s most recent scam alerts.

Disclaimer: The information posted to this blog was accurate at the time it was initially published. We do not guarantee the accuracy or completeness of the information provided. The information contained in the TransUnion blog is provided for educational purposes only and does not constitute legal or financial advice. You should consult your own attorney or financial adviser regarding your particular situation. For complete details of any product mentioned, visit transunion.com. This site is governed by the TransUnion Interactive privacy policy located here.

What You Need to Know:

There are various types of credit scores, and lenders use a variety of different types of credit scores to make lending decisions. The credit score you receive is based on the VantageScore 3.0 model and may not be the credit score model used by your lender.

Subscription price is $24.95 per month (plus tax where applicable).