Attempted fraud by the use of online payment providers such as Paypal.
I use Paypal as the vehicle to receive payments from my clients which are located all over the world.
Just recently, I received an e mail which looked exactly as if it had come from Paypal, right down to the colour on the letterhead. This mail asked me to update my card details, or payments to me would be blocked. And because I was not vigilant or aware enough, I filled in the form, and sent it off, under the impression that it was all above board.
Later, I got an SMS alert from my bank, to say that my card had been used to purchase goods from a certain company, whose name was provided, to the value of $1500.
Fortunately I was able to find this company on the net, and telephoned them. They confirmed that an order had been placed from Nigeria with my card details, for delivery to an address in the US. They had not yet shipped the goods, and I was able to provide them with the information needed to cancel the order, and they put in a refund request for me. All of this was confirmed in writing by both parties.
As soon as the payment cleared into their account, they refunded the money to me, less the card fee handling of $5.
I was very lucky, and will not be caught again. If I had not acted as quickly as I did, I might have lost the $1500, which is a lot of money to me.
This could have been devastating if they had taken more from me, and if I had not been timeously alerted by the bank of the activity in my account. I was also fortunate that because I am not resident in the US, it was a foreign card presented to an American company, and it takes longer to clear. My bank had already approved the funds, which had not yet cleared on the other side, so the goods had not yet been shipped. I was able to stop the shipping, and got a refund from a very honest US company!
Paypal is used by millions of people worldwide for financial transactions. After my experience I conducted some research into how these frauds happen.
Paypal, including Bitpay, Credtcall, First Data, and Heartland Payment Systems, among others, are all reputable online payment service companies, widely used by businesses and individuals.
Here are some tips that will help you not to fall into the same trap. You might not be as lucky as I was.
No matter which online payment service you use, they will not send a request on open forum for you to update or confirm bank details.
Do not respond to any such requests.
In my case, the mail from Paypal looked absolutely authentic, and included in the request was a notice that any payments due to me would be frozen, until I had supplied the information. So watch out for phishing! Here is how to report that to PayPal.
Ensure that you have an arrangement with your bank to always advise you of any payments made from your accounts.