Retailers Processing Network Blog

Never wire money as part of a retail sale

Retailers Processing Network - Saturday, November 26, 2011

“Never say never” usually holds true in life, but in the case of handling a MOTO (mail order/telephone order) transaction as a retailer, you should never wire money to someone.

Let me repeat, because it’s that important. Never wire money to someone as part of a retail transaction.

With the Great Recession of 2009-10 has come a marked increase in the number of merchants who are being taken advantage of by fast-talking scam artists who want something for nothing.

The scam usually starts innocently enough. You get a nice size order for products or services from an unexpected source. The story seems legitimate and fits your business model.

After the bad guy has set the hook, he suddenly “discovers” a problem that can be “solved” with the help of you, the merchant. Usually it is for shipping or for other services; the problem has even been to help the “customer” with customs (for an international order) or tax reporting.

The solution to the customer’s problem is for you to run another transaction and wire the money to another person or company.

These scams are limited only by the imagination of the scam artist and the gullibility of the merchant. Here are some real-life examples:

• A jewelry store customer requests a custom diamond ring, but needs part of the purchase price rebated to cover shipping and/or duty;
• A car dealer customer is interested in purchasing a unique used car, but needs part of the purchase price rebated to handle the shipping of the car;
• A granite memorial customer is interested in purchasing a custom headstone for a dead relative, but needs a portion of the purchase price rebated to facilitate delivery and installation;
• A tire dealer customer wants to purchase four racing tires, but wants them shipped to the racing event and requires a special shipping method;
• A B&B owner receives a request to “rent” the entire facility for executive meetings, but requires the use of an interpreter and needs the separate services to appear as one transaction for tax reasons.

As you might expect, the person or company receiving the wired funds is a partner in the crime being committed. The scam artist has no interest in the actual item or the service, just the wired money.

If you receive an order that follows this track, do not wire money. Ever. Once you wire the money (via Western Union or similar service) it is gone forever, because there is almost no way to get it back. The bad guy has your money, and the credit card transaction will become a chargeback with you holding the bag.

If you ever have doubts about a transaction, call your help desk. They have probably seen or heard of the scam before and can offer sound advice. Remember, a sale that turns into bad debt is not a sale, it is just bad debt.

John Mayleben, CPP, is RPN senior vice president technology and new product development and a national expert on electronic payment processing. Contact John at

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