Triangulation fraud
Triangulation fraud
Triangulation fraud definition
Triangulation fraud is an online scam involving three parties: an unsuspecting buyer, a genuine seller, and a fraudulent seller as a middleman.
See also: scam
How triangulation fraud works
- The scammer sets up a fake online store offering products at significantly reduced prices to lure buyers.
- When a victim buys something from them, the fraudster takes the order and uses stolen credit card details to get the same product from a genuine online store.
- The real seller then ships the product directly to the victim, believing they made a legitimate sale.
- The scammer keeps the money from the original sale. Plus, they never had to handle the actual product.
Damage of third-party fraud
- Stolen money. The scam relies on using stolen credit card data, which means someone is paying for the product without knowing about it.
- Loss for the seller. The genuine seller faces chargebacks when the true owner of the stolen card disputes the transaction.
- Loss for the buyer. While receiving the product, the victim may end up with substandard goods or face issues if they attempt to return or service the product.
- Reputation damage. Genuine sellers can have their reputation tarnished if victims believe they were part of the scam.
- Legal issues. All parties can get entangled in legal troubles, especially if they try to trace back the fraudulent transactions.
