Avoiding Domain Name Scams

These are some of the most current scams concerning domain names. The people, who pull them off, have hurt many domain name investors, buyers and sellers. At the Domain Name Pros, we make it our business to stay on top of our industry and keep you abreast of what’s going on. We wish that it wasn’t so, but unfortunately, whether you are buying or selling a domain name, it is imperative that you properly protect your interests from unscrupulous men and women. Get to know these scams…

Administrative Contact E-mail Warning

There has been an increase in the number of domain thefts of late due to compromised registrant admin email addresses. You should always insure that your registrant’s Administrative email address is not only up to date, but that it is not bouncing. Also you should be using a registrar that sends out expiration notices prior to a domain name expiring. Domain name thieves use errant admin e-mail addresses to hijack domain names every week.

The PayPal Dispute Scam

This con game is being used more and more since it so successful. It works like this… the transaction go smoothly. The buyer purchases the domain name and you transfer ownership. While you are enjoying the fruits of your labor, the scammer opens a dispute with PayPal claiming some type of infraction on your part, (i.e., you didn’t deliver the product, it was not what they ordered, etc.) At that point, PayPal sends you a dispute e-mail citing the buyers claims. Even if you respond, oftentimes, based on the buyers description, PayPal may issue a refund by taking the money out of your PayPal account and refunding it back to the buyer. To avoid this trap, either use an escrow service or use the PayPal Mass Pay Option.

The Credit Card Charge Back Scam

Anytime person uses a credit card payment in a transaction, they have the right to file a dispute with their credit card if they are not satisfied with the purchase. Domain Name scammers and con artist use this right as a loophole to acquire high value domain names for free. Here’s how this scam works… they purchase the domain name with a credit card and soon after they take possession, they file a dispute against the seller through their credit card company. In most of these cases, the seller will usually lose because the credit card company represents their customer, the domain name buyer. To avoid this trap, use an escrow service that has a no charge back policy.

The Business Partner Scam

This is a new twist to gain control of your domain name(s). It works like this; a potential buyer contacts you concerning a domain name and before you know it, they are offering to invest substantial money into your business. To seal the deal, as your new partner, they will need access to your domain name account with your registrar. Once you give them access, you can kiss your domain name(s) and your Internet dreams good by. The lesson to learn here is this: never give anyone access to your domain name account. Not even a new business unless you solicited them as an investor and even in that case be cautious.

Warning: Rialex and Domain Thefts
Be cautious and concerned when dealing with any party that asks for payment to be made to Rialex as Rialex is a payment processing company that sends money to Iran and there has been a purported Iranian/Rialex connection in many of these thefts.

The Fake Interest - Bait and Switch Scam

This scam is one of the oldest domain name scams on the Internet. On the surface, the potential buyer seems authentic, but in reality, they are implementing the old bait and switch scheme. How does it work? You receive an offer to purchase e-mail from what appears to be a potential buyer. Once you respond the e-mail, the scammer gently switches gear and requests that you either acquire a paid appraisal or a paid domain name history/theft check from companies they recommend, prior to the purchase. It seems like a reasonable request to the unskilled domain name seller, but to the pros who know… THIS IS A SCAM! Here is a copy of one of the scammer’s e-mails:

Hello,

Are you still interested in selling your domain name? I saw it listed for sale.

Have you received offers from others?

I’m ready to purchase this domain now; I just need to know your desired price. There’s no need for me to make an offer. Just email your desired price.

I run an IT company that develops client-server systems and databases in Oracle for high profile companies. Buying and selling domain names is not my main business, it’s just another way that I invest money to make additional income.

Best regards,
Dr. David Hillsbury, Ph.D.
President
NTerNet Solutions

Important things you may need to know:

Steps To Purchase a Brandable Domain Name

How To Pay For Your Domain Name

How We Complete Your Domain Name Transfer With Godaddy.com