In the world of COVID-19, every restaurant’s priority should be to create a safe and…
Nextdoor, the private social network for you and your neighbors. This popular app is used to keep up with community news, communicate with neighbors, find out about job opportunities and ask for local service recommendations. Unfortunately, scammers have found a way of leveraging this community app to scam its users.
Recently, one of our Risk Management team members was using the app and noticed a post from a local handy man. The handy man shared a suspicious text thread between him and someone requesting his services. The text came from an unknown number who was requesting pricing for unspecified repairs. After additional text exchanges, the individual stated he urgently needed repairs on a newly purchased home in Florida but was unavailable for phone calls due to being in the hospital. If the handy man agreed to completing the unknown repairs, he would receive payment for his services via credit card.
This is a common scam pattern, someone who is difficult to authenticate with an urgency in job completion, pricing is of no concern and no verifiable source of referral. In these scams, fraudsters hope to find a victim they can establish a trusted relationship with in order to find new ways of defrauding them. Once a relationship has been established, victims are hired as General Contractors. As contractors, they bring in other vendors and pay them out using the fraudulent credit card. Subsequently, the victim is left out of the resources put in to complete the job, out of hard cash used to pay vendors and responsible for bank chargeback fees.
After transactions begin to bounce, the scammer either stops communicating or provides another form of fraudulent payment. This results in the victim being pushed deeper into the cycle scam.
Fortunately, in this case the scam was prevented. The Nextdoor community shared information in the app, eventually realizing this was part of a bigger scheme. A number of neighborhood vendors and trades people were being contacted with a similar scam framework. Through collaboration and communication, the neighborhood avoided becoming part of a fraudulent scheme.
Typical red flags to look out for are, immediacy on starting and completing the task, no in person or verbal communication (in this case, fraudster was in the hospital), no concern over the work or knowledge of the work and no discussion of price. These are real-world examples on what defines “too good to be true.” We recommend that if you are in a business of providing services to people where there is a hard cost and an opportunity cost, you do your due diligence and take preventative steps to avoid getting sucked into a scam.
This blog is made available by TouchSuite for educational purposes and to provide general information about certain topics but does not provide professional advice. The blog should not be used as a substitute for seeking professional advice in your state. TouchSuite assumes no responsibility for errors or omissions in the contents on the blog.