Tips for Avoiding Online & Phone-Order Scams

Hacker attacking internet

I was studying our 2020 business plan when the call came in. The man on the phone said he wanted a skimmer, and I took his order. That’s when things began to feel … a little wrong.

The man’s accent was Eastern European, but his name was Drake. The skimmer was not unusual, but I’d sold exactly the same one the previous day, again by phone. He haltingly supplied his address. Even more disturbing—the “customer” had zero questions!
With mounting suspicion, I proceeded to do a reverse-phone-number search and a quick online address verification while he was on the phone. The information returned very conflicting information. My suspicions were confirmed. It was clear that I was dealing with a con artist. I told “Fake Drake” that the card would not go through. He promised to call his bank and hung up.

After the call, I pondered what had happened. Our experience with credit card fraud had been limited to our website. I double-checked that previous skimmer order we received over the phone, and it, too, turned out to be a bogus order.

If criminals were placing orders by phone, we were really going to have a problem! I was not sure how to proceed, but by the next morning, I had a plan. It was reckless, slightly dangerous and fraught with potential failure at every turn — so it was absolutely perfect for me.

Joining the “Mafia”

My plan was contingent on the crook answering his phone. I dialed, and on the fourth ring, he answered.

“Hi, may I speak to Drake?” I inquired.

“Who?” the voice replied.

“Drake Blackwell. It’s about the skimmer he ordered.”

“Oh, yeah … this is Drake,” he said.

A huge grin spread across my face — the game was afoot.

I told him that I knew he was using a stolen credit card and a phony name. For a small surcharge, I offered to help him run charges through my employer’s company.

He hung up, but I was undeterred. I called back. I launched into how I desperately needed money and proceeded with a tirade about my boss. I offered to help him steal from my company if I could get in on the action. Curiosity got the better of him, and we began to talk.

“So, Drake,” I said. “Is that your real name?”

“I can’t tell you that,” he said.

“OK. How about I call you Mr. X?”

And just like that, my induction into the criminal world had begun, and Mr. X would be my mentor. While Mr. X was a boss, he was not the big boss. He reeked of unappreciated middle management. He craved a sympathetic ear, and with little prodding, he proudly told me about the expanses of his organization.

Mob School Orientation

“We have 1.5 million stolen credit cards with full names, addresses, phone numbers, security codes and banking information,” Mr. X said. “We have hundreds of people all across the United States who place orders all day long. With debit cards, we can drain an account in one day. If the bank declines a purchase, we call them and clear it, since we have the security info.”

On and on he went, spouting information about how the organization operated and claiming several times that they “cannot be stopped.”

As our conversation proceeded, I asked him why they had ordered skimmers. Mr. X had absolutely no idea what a pond skimmer was. He confided that he simply had a list of items to fill from a buyer, and he spends each day ordering them.

Eventually, he asked me how I could benefit the organization.

I suggested that I was a master at conversation, I knew the products, and I could easily establish a rapport with other businesses. This would result in a higher rate of purchases for the organization. Mr. X mulled over my suggestions and came up with an idea. He would set me up in my own operation. I could steal whatever I wanted, but I would have to fill additional orders to destinations of his choosing.

Welcome to the Dark Web

To get started, I needed to purchase a block of 1,000 stolen credit cards for $15 each. He even offered to send me a free sample card to test out.

“Great! Should I send you a money order?” I asked.

“Oh, no! Nothing like that!” Mr. X exclaimed, almost laughing. “Just set up a Bitcoin account, and that is how you will pay me. Create a new email address and use it only for our correspondence. Once you are done, call me, and I will email you a link. Don’t open the link until you are ready to transfer the Bitcoin. The link will only work once. The link will not open if forwarded. The link will disappear in 24 hours.”

I assured Mr. X that I would gather the funds quickly. However, after thinking about this elaborate criminal operation, I decided that it was not worth making an enemy of the mafia. I would simply end my queries and never call him back.

Having put this adventure behind me, I found the rest of the week relatively uneventful. We did have to refund a few online orders that were found to be fraudulent, and another lady called about a skimmer. (We declined the order.) Other than that, it was back to business as usual.

Mr. X’s Very Bad Day

A few days later, the phone rang.

“Graystone Industries, may I help you?” I said.

“This is Drake Blackwell. I want to check on my order,” the caller said.

“Mr. X, is that you?”

“Oh yeah. Hey.”

“We cancelled that order a few days ago, remember?” I said.

“OK. Thanks. Bye.” He quickly hung up.

He clearly had no idea whom he had called, but I shrugged it off.

A few minutes later, the phone rang again. I recognized the number.

“Hello, my name is Jeffrey Westell,” the caller said. “I placed an order for some pumps and need the tracking number.”

“Mr. X! Hey, it’s John!” I exclaimed. “Remember? I wanted to join your organization. You accidentally called me back again.”

“Oh, yeah. Are you going to buy that block of cards?”

“Well, $15,000 is a lot of money for me,” I replied.

“I could sell you 100 cards,” he quickly offered.

“OK, I will let you know.”

Not even 30 minutes later, he rang again. I had to cut to the chase.

“Hey, Mr. X, it’s me again,” I said. “You need to stop calling here, or my boss will get suspicious.”

“You again? Man, I don’t have time for this!” he said.

“Maybe you should stop placing orders here,” I continued. “The owner seems to be on to us.”

“We will stop placing orders if you buy the credit cards,” he offered curtly.

“I guess I will talk to you soon, then,” I replied. I could not help but add, “I hope the rest of the day goes better. You seem a bit stressed out.”

Mr. X sighed and hung up.

Mr. X’s Exclusions

During my conversations with Mr. X, there were two things he conveniently did not share with me. Both of these should be of great concern to the pond industry.

First, he did not mention how the product gets from the requested addresses —often remote locations or apartments — to the buyers who are ordering from the criminal organization. Perhaps these packages are stolen from the porches of remote houses or picked up from the doorsteps of apartments that are known to be vacant? Mr. X would not tell me all his secrets.

Second, and more importantly, who is ordering these pond products? Are they being resold online? Is it possible that someone in our own industry is ordering their stock directly from these criminals? The products they chose to order indicate some level of knowledge of the industry, yet the criminals doing the ordering have no idea what they are stealing. Mr. X asserted that he could not tell me who his customer was. It was my impression, however, that even he did not know who his customer was.

What Can We Do?

With the information provided by Mr. X, a little common sense and some available tools, I believe 95% of fraudulent orders can be identified and stopped.

By no means do I suggest hanging up on customers or dismissing online orders prematurely. Instead, just proceed with caution. Double-check each unusual order carefully before shipping. It can take up to a week or longer before credit card fraud is detected, and once the order ships, it is unlikely that you’ll get it back. Asking for just a little more information from the customer could end up saving your company thousands of dollars. Consumers are aware of credit card fraud, and legitimate customers are almost always willing to help you help them.

In the words of Mr. X, perhaps these scammers “cannot be stopped.” But, I’ll bet that if we all work together, we surely can slow them down a little bit.

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