Internet experts are warning consumers about fraud artists using fake escrow services to dupe people.

An escrow service acts as an intermediary for buyers and sellers who have reached an agreement on an item for sale. The escrow service will hold the payment in trust until the buyer inspects and accepts the merchandise. Once the buyer is satisfied, the escrow service will release the payment to the seller.

Some sellers are copying information about real cars for sale on other sites such as AutoTrader.com and listing them for sale on eBay. When buyers purchase the cars and transfer money through an escrow service, they soon find out they've been duped when the car never shows up.




It's not just buyers who are getting scammed. Even sellers have lost money.

Adam Owen sold his laptop computer on eBay. He used Escrowsol.com which notified him that it had received the buyer's money. Owen sent the laptop to an address in London, England. He never got the money because the escrow site was not legitimate and he also lost his computer.

Other eBay sellers say they've sent laptops to an address at Wood Street in London and never received payment from an escrow service. Scotland Yard is now investigating.

A site has been created listing almost 50 fake online escrow services and legitimate ones — www.sos4auctions.com. Many of the fake sites are believed to be connected.

The crime can be a hard one to trace. Fraudsters will often use stolen credit cards to register a Web site, using a domain with the word "escrow." They then copy the look of a legitimate escrow site to make it appear authentic.

eBay, the world's largest online auction service, says there have been "virtually no fraud cases reported" by its members involving escrow services. eBay recommends escrow services for purchases over $500 and promotes a site called Escrow.com.

Kevin Pursglove of eBay says members should consider another service such as "Transcrow." The service helps sellers set up a bid verification process in which bidders are asked to submit a driver's license and credit references.

Experts say consumers can protect themselves by being vigilant:

  • check for poor grammar on escrow sites
  • the most copied sites are Escrow.com and Escrow.ca, check them out
  • the "Terms" page is usually stolen from another site
  • be wary if a seller insists on using a specific escrow site