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  1. #1
    Administrator Clinton is a Premium Member
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    New scams by Flippa sellers

    I discovered yesterday a new way dodgy sellers are finding of circumventing Flippa rules and exploiting less experienced buyers.

    They create their listing and are careful to follow all the listing rules. Wild claims, claims about originality on content, guarantees about future rankings etc., are kept out of the listing to make the listing look very legit.

    But they've got the copy all carefully prepared - copy that makes all the above claims to hoodwink n00bs - and they send it by PM as soon as you bid or show any interest. In fact, you have to PM them as they usually leave out one crucial bit of information or make a blatant typo to tempt the private contact.

    Some of them have gone one step further and withheld their URL behind a Confidential Listing requiring you to sign up to their NDA and, bingo, they can now PM you the FAQ.

    Flippa, you won't find these sellers by going through my own private PMs at Flippa. I was given a login to someone else's account to see this yesterday.

    Caveat Emptor, but when the emptors being encouraged to bid in Flippa are raw n00bs then Venditor Praemium.
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    There are always going to be new ways to scam innocent buyer, but it is up to Flippa to figure out a way to combat these new schemes or it will completely lose all credibility.

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    Quote Originally Posted by David S View Post
    There are always going to be new ways to scam innocent buyer, but it is up to Flippa to figure out a way to combat these new schemes or it will completely lose all credibility.
    This (scamming in general, not this specific implementation) has been going on for a few years now, so I don't think it's an issue for Flippa. The only way it will harm them is if some other marketplace puts in the effort to cut down on scams.

  5. #4
    Administrator Clinton is a Premium Member
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    David, why is it up to Flippa? Flippa is just the marketplace and therefore cannot take responsibility for buyer stupidity or carelessness, can it?
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    Clearly it IS up to flippa.

    If they allow posters to hide sites behind "URL hidden" then the buyers have no way of knowing whether the seller has multiple schill accounts selling related websites. The only ones in a position to do the comparison is flippa, and so they MUST do it, or possibly even leave them selves open to negligence claims.

    I can confirm (a) there are such schill sellers and (b) flippa are not finding them. Even basic stuff like "same analytics snippet"

    If I can find this, flippa could too.

    But I can only do it KNOWING the URLs which flippa allows sellers to keep hidden.

    In MY view flippa can and must do more to vet sellers. ie ONLY ratified address and identity sellers should be permitted to sell or buy over $1000. There are many technological solutions to this, like forcing seller deposit of funds from a known credit card, for which the sellers name and address match. Clearly any (later) attempt to change name and adress can be viewed with extreme suspiction.

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    Quote Originally Posted by mikeb View Post
    Clearly it IS up to flippa.

    If they allow posters to hide sites behind "URL hidden" then the buyers have no way of knowing whether the seller has multiple schill accounts selling related websites. The only ones in a position to do the comparison is flippa, and so they MUST do it, or possibly even leave them selves open to negligence claims.

    I can confirm (a) there are such schill sellers and (b) flippa are not finding them. Even basic stuff like "same analytics snippet"

    If I can find this, flippa could too.

    But I can only do it KNOWING the URLs which flippa allows sellers to keep hidden.

    In MY view flippa can and must do more to vet sellers. ie ONLY ratified address and identity sellers should be permitted to sell or buy over $1000. There are many technological solutions to this, like forcing seller deposit of funds from a known credit card, for which the sellers name and address match. Clearly any (later) attempt to change name and adress can be viewed with extreme suspiction.
    We'd love to hear about any shill bidding that you see happening in our marketplace... please contact us.

    And we do require credit card verification for all bids above $2000 in our marketplace already, to eliminate not only shill bidders, but to weed out people who have no intention of following through. It's been very successful at reducing disputes.

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    Matt - Sorry I missed this.

    I did contact you guys through support to share what I know. It was like trying to push water uphill.
    It took four? five? responses and several weeks to get past the platitudes to get a glimmer of interest.

    By the time I got interest in a discussion from flippa the trail was already cold. The trial accounts for statcounter that (unlike analytics) seemed to find the problems had expired. Even the tool I was using to prove the correspondence (reverseget.com) was by then discontinued: so discussion after that seemed largely pointless.

    I have a few screenshots of reverseget and statcounter but that is all.
    Happy to discuss , but I want information too.

    In that process I discovered that some of the scammers seem to be good enough to fool google (analytics and adsense) and that is really scary! Conventional wisdom on due diligence of "Google analytics is the gold standard" seems to be wrong.

    And they were certainly fooling flippa - by selling related sites behind URL hidden multiple identities ( which had variously, private server name strings, email id, adsense id , or analytics id in common). The reason I got to know some of this is by networking with one other about sites he had been offered, so we put some pieces of a puzzle together to come to a worrying conclusion.

    The prototype for the scam I think we unearthed seems to be:

    1/ At the heart is click fraud to show real earnings for adsense over a period of months to make a site look attractive to buyers. The earnings screenshots in as far as I can tell real at least for a period, because a live video screenshot of adsense is hard to fake. The earnings continued even when adsense snippet was changed. So this was not as far as I can tell discoverable by fake or verifiable earnings tools. The earnings continued for a couple of weeks after transaction then stopped dead.

    2/ The problem then is to generate traffic that makes those earnings seem sensible CTR. This is the clever part.
    They appear to use a series of US bots to drive traffic (which looks like genuine US search traffic), but it gets through a blindspot in google and appears to be rea. It is cunning, I will grant them that. Statcounter tells a different story, it appears to see the bots, which analytics seemingly cannot.

    3/ The final part - to avoid getting caught on flippa use multiple identities, and hidden URLs. I can say for sure that some of the sites being sold by multiple identities were being sold by the same person or group, but I did not know that till later. I am guessing the reason they wanted rid of the sites, is they knew the game would be up on google sooner or later.

    It seems to me that non paying bidders are and will be just an annoyance in your formula. And a credit card does not prove they can or will pay. It only allows you to ban them! The sellers and you - are protected from all but a waste of time, by various escrow processes. Resulting in no money , no site, so no scam possible. Just time wasters.

    Using credit card validity for buyers, is a bit like making sure the christians are real christians and tasty enough before throwing them to lions: Which may make good business sense, it is not necessarily ethical. It is the lions you should be controlling, they are the ones doing the eating!

    Scammers are for the most part sellers. So they IMHO are the ones who need to produce identity proof, using credit card for example to validate name and address. Particularly if they intend to sell URL hidden. It seems to me they must prove who they are before being allowed to sell. If the earnings last longer than escrow period, then escrow in and of itself is no protection.


    If what I see is real, and I think it is - these guys are clever, and will stay one step ahead, so there is no easy panacea. That means every means is needed to root them out. Like selling related sites from many identities is suspicious in and of itself, but only flippa know that, so it is up to them to root it out.
    Last edited by mikeb; 22 June 2012 at 4:06 am.

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  11. #8
    Administrator Clinton is a Premium Member
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    Quote Originally Posted by Matt Mickiewicz View Post
    We'd love to hear about any shill bidding that you see happening in our marketplace... please contact us.
    That's a nice invite Matt, but it's not the job of users to keep you updated on shill bidding on your platform, it's your job to figure it out! The general public have very little data to go on. They don't have users' IPs, email addresses, usage patterns, bidding patterns or the vast store of other data that you've got.

    All we general public can have is suspicion of shill. There's little point in reporting that to you especially if support is geared to hand out platitudes like they did to mikeb. If we spot shill bidding it's too late, it means your systems have failed. I don't envy you the task of spotting shill bidders, it's difficult, but that task is yours, not ours.

    In that process I discovered that some of the scammers seem to be good enough to fool google (analytics and adsense) and that is really scary!
    Unfortunately, coverage in blogs and elsewhere seems to see the "verified" GA and Adsense facilities in Flippa as a Good Thing. These bloggers are misguided (or blind), I believe. Several of them are members of this forum so, sorry guys, but Flippa verified anything is, like the "complete due diligence stats", simply a bit of fun and not to be taken seriously. But many buyers are taking it very seriously and relying on it. As bryanon says in the tradingwebsites blog, some buyers are obsessed with these so called "verified" stats. They count on them in the mistaken belief that they are somehow safer. They get this idea because of the coverage in Flippa and Flippa-friendly blogs. This is not bad news for Flippa ...as it does reflect favourably in the success fees.

    There are plenty of services around that will inflate your GA or your Adsense stats for you. From that site:

    Your website will have thousands of visitors from Google that searched your website for any keyword you want....

    Boost the value of your website to the sky.
    Selling websites on Flippa? Do you need those extra visits to make your website more valuable and sell it for the price it deserves? Lots of good traffic from Google is what will make you sell your website higher.
    Kudos to Flippa for trying to improve their platform, but verified Analytics and Verified Adsense earnings in Flippa are about as reliable as those millions of valuation sites that tell you your brand new domain is worth more than Facebook. Funny how even some smart people in the industry can't see that (or choose not to).

    Domainshane:
    The biggest problem on Flippa has always been fake stats (and now that problem is solved)
    Yeah, right!
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  13. #9
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    Of course it's up to Flippa. It's in the best interest of the marketplace to minimise the possibilities of their members getting scammed.

    If someone gets scammed on a purchase they've made through Flippa then it's Flippa who risk losing a buyer for life.

    Obviously one could claim that there are no good alternatives to Flippa (even though there are - for mid- to high-end sites anyway), most buyers who are vulnerable to scams are new in the whole industry and getting scammed on their first few purchases may make them leave the industry for good, so at the end of the day Flippa still lose a customer, even though the customer has nowhere else to go.

  14. #10
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    Quote Originally Posted by bryanon View Post
    Of course it's up to Flippa. It's in the best interest of the marketplace to minimise the possibilities of their members getting scammed
    I get both sides of the argument, but isn't it a little like delegation, as in you can delegate authority but not responsibility?

    Flippa should be making an attempt to get rid of scammers - if anything it's good for business, but they're not omnipotent; ultimate responsibility lies with the buyer to educate themself and not rely on anyone else to guarantee they don't get taken for a ride.

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