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December 8, 2000
Electronic Games Sales Scam
Electronic game buyers beware -- Web sites may advertise popular games for sale but never deliver them. That's the warning from the U.S. Council of Better Business Bureaus and the Canadian Council of Better Business Bureaus. The Canadian CBBB recently began to receive numerous inquiries from consumers in the U.S. about two Canadian-based Web sites, www.ps2storeusa.com and www.ps2storecanada.com, which advertised that they had "a large supply" of Sony Playstation2 products. Since the products are sold out in many retail stores, desperate consumers are searching the Web to find them for holiday gift-giving.
According to Bob Whitelaw, President and CEO of the Canadian CBBB, complaints from consumers who placed orders and haven't received the merchandise are coming were coming in at the rate of more than 20 a day. "What's particularly alarming is the fact that purchasers were asked to fax a photocopy of the front and back of their credit cards to assure speedy delivery of their gifts. No legitimate business will request photocopies of your personal financial information," said Mr. Whitelaw.
The Canadian CBBB moved quickly. It confirmed with Sony Computer Entertainment, the manufacturer, that no commercial Web sites can legitimately claim to have large quantities of Sony Playstation 2 products. Sony asked the Royal Canadian Mounted Police to investigate. The CBBB also contacted Visa and MasterCard Canada, who alerted their counterparts in the U.S. to the potential for credit card fraud.
Within days, the Web sites were shut down. The address for the business that operated them, Playstation Store of USA and/or Canada, was a derelict house in New Brunswick, Canada. When consumers visited the Web sites, they were advised to call a toll-free number, which connected them to a call-center in Sacramento, California. The fax number to which they were instructed to transmit the copies of their credit cards to "expedite their orders" was in the state of Washington. And Whitelaw says that the money that the company appears to have wired the money it reaped to a bank in Florida. He was also informed that the business owners obtained credit card merchant accounts by falsely representing that they planned to open a store in a mall.
Whitelaw advises consumers who provided their credit cards to the company to notify the banks that issued them immediately and discuss canceling them, since copies of those cards, including the account numbers, signatures, and other information that can be used for identity theft are now in someone else's possession. Complaints should be filed with the Federal Trade Commission at (877) 382-43576.
Consumers should use caution no matter where they see products offered for sale online; company Web sites, online auctions, or online classified ads. Tips for online shopping include:
- Know who you are dealing with. If the seller is unfamiliar, check it out with your state or local consumer agency and the Better Business Bureau;
- Know how to reach the seller. Look for the physical address and telephone number;
- Be wary of unrealistic claims and promises;
- Be aware that your legal recourse against an individual selling goods online may not be the same as with a business;
- Pay by credit card so you can exercise your dispute rights in cases of fraud or misrepresentation. But be suspicious of any company that won't take the credit card information online or over the phone.
Additional tips about protecting yourself when you're shopping online are available from the Better Business Bureau at www.bbb.org/library/Visa-BB.asp and the National Consumers League at www.nclnet.org.