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Seller beware: How thieves can scam you

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  • Seller beware: How thieves can scam you

    I copied this article from the April Inner Fidelity email. It details how thieves were scamming high end audio companies by using stolen credit cards and changing the delivery location at the last second by switching from the credit card holder's address to the local UPS center. They were eventually caught, but only after the seller's diligence, good police work, and some luck.

    http://www.innerfidelity.com/content/busted

  • #2
    Busted!!!
    By Tyll Hertsens • Posted: Apr 11, 2013 • Published: Apr 3, 2013

    Todd gets ripped off....twice!
    Sometime last fall Todd "the Vinyl Junkie" Green got a phone call from a customer interested in his Pinnacle headphone amp, a $10,000, top-of-the-line piece of gear. The customer seemed well versed in the world of high-end headphone listening, and nothing in particular seemed amiss. The amp wasn't in stock, so Todd did a little sleuthing in the mean time to ensure that all the addresses and security codes matched. All seemed good, so the card was charged without trouble and the box was put into the hands of UPS to be shipped to the address associated with the credit card.

    Todd happily went on with life as a high-end vendor thinking he had another satisfied customer until a short time later when he discovered the credit card company reversed the charge and he found himself with a $10,000 hole in his bank account.

    That's a whole lot of money for a small business to lose. Todd was shocked...and angry. Evidently the perpetrator had contacted UPS to have the shipment diverted from the credit card address to be held for pick-up at a UPS office. Then, using a fake ID that matched all the purchasing information, the perpetrator picked up the Pinnacle and walked out the door with a free amplifier. Todd made inquiries of UPS and the credit card company, but found no remedies. He considered pursuing recovery using a private detective, but that just began to look like throwing good money after bad. He decided to simply round up all the evidence he could and file a report with the police in Orange County where the crime had been committed...and then just carry on as best he could.

    I've known Todd for more than 30 years (we worked together before I started HeadRoom), he's a stand-up guy. He rolls with the punches life doles out, and just keeps working it as best he can. In this case, to cover his losses, he dug into his stash of fabulous mint vinyl and offered it for sale at bargain prices. He survived...even thrived, by knuckling down, working hard, and making good deals for customers.

    Then, just a few months later, it happened all over again, this time with a pair of E.A.R. 509 mono-block power amplifiers valued at $14,700. Different names and addresses, but the scam went about the same. This time, however, there was a security camera picture of the perpetrator picking up the boxes. Todd decided to tell the story on Head-Fi with the pix and asked for the community's help in solving the crime. A desperate measure, but one that eventually paid off.

    Enter HeadAmp's Justin Wilson
    About a few weeks ago, Justin got a call from a customer interested in a pair of $5000 Stax SR-009 headphones. Again, the customer seemed legit and well versed in the world of headphones. Oddly however, he claimed to be unaware of Head-Fi.org. This got Justin's spidey-senses tingling as it would be rare that someone interested in a $5000 headphone would be unaware of Head-Fi. Even though it was looking very legitimate, the buyer was in southern California, and Justin being well aware of Todd's troubles from the Head-Fi post started digging.

    He called the customer and asked for a photo copy of his ID and credit card. The customer refused to send an image of the credit card, but did agree to send a copy of his billing statement. While waiting for the proof, Justin Googled the shipping address and found it to be a business. He began calling the business, but the phone went unanswered. Eventually (and I may be getting the series of events a bit jumbled here), Justin did contact the business owner(who had been in Europe), and who was correctly identified on the card but had not made the purchase. By the time he received the customer's photocopy of the ID and billing statement he knew he had a scammer on his hands, and careful observation of the documents sent showed a number of errors.

    Justin contacted the Torrance police department and provided all the info needed to get them to move into action. A box of appropriate size for a Stax SR-009 was loaded up with two aluminum bars Justin had lying about to give it the right heft. The shipment was made to the credit card address, and the customer was emailed the tracking number. All that was left to do was for the Torrance PD to keep hitting the refresh button on the Fed-Ex tracking page to see when the perpetrator changed the shipping from the credit card address to hold for pick-up, and to find out which Fed-Ex office was chosen as the shipment hold location.

    ...tick...tock...tick...tock...

    Many refreshes later...Bingo! The Fed-Ex tracking showed the customer had elected to change the shipping to hold for pick-up and revealed the chosen location. On delivery day---April 1st, how appropriate---the Torrance police, to their great credit, positioned an officer behind the counter at the Fed-Ex location, and had an unmarked vehicle outside the office.

    ...tick...tock...tick...tock...

    And then it happened, at about 3:49 PM, the perp came in with proper (fake) ID and picked up the box. He walked out of the Fed-Ex office and got into a car with another person in it. With the undercover Torrance police following, the perp and accomplice eventually found their way to an apartment building. The perp got out of the car and went inside with the box. Then came back out, at which point the police evidently confronted the thieves. A foot chase ensued. Eventually, the perp was caught and brought into the police station for questioning. At this point the police had to find out which apartment the box had been delivered to and had to get warrants to search the apartment.

    Now, here's the weirdest part of the story. At 7:20PM Justin received an email from the customer: "I've just filed an IC3 complaint. Returning your "product" for a full refund today." Evidently, the real (fake) customer was in the apartment. The guys who picked up the box were simply 'mules' making the pick-up and delivery. It was later found they got paid $100 for the task. So picture this, a thief who went to great extents to scam Justin out of gear, receives his Stax SR-009 delivery and opens the box only to find two aluminum bars. And then has the gaul to email Justin threatening an IC3 complaint.

    The IC3 is the Internet Crime Complaint Center---a joint venture between the FBI and National White Collar Crime Center. I was unaware of this office. Are you aware of this office? Probably not. But for damn sure this internet criminal ripping off high-end audio gear was aware of the IC3, and he was now threatening Justin with actions through them.

    Bwa ha ha ha ha ha! Little did he know what the evening had in store for him.

    As soon as Justin received the email, he called the cops to let them know. Now it was obvious to all that a third party was involved---the real criminal---who remained at the apartment building. Evidently the police got enough info from the mules to figure out which apartment the main perpetrator was in, and they got the warrants they needed.

    At about 10PM, they bust into the apartment. The perp is in bed. The apartment is loaded with hundreds of thousands of dollars worth of various and sundry stolen audio and high-tech gear...including Todd's E.A.R. 503 mono-blocks and the Pinnacle amplifier...and, of course, two aluminum blanks. :)

    A Happy Ending
    Now, because Justin and Todd had been so thorough with the record keeping and communications, the police have all the evidence they need to prosecute the criminals, and they have no need to hang on to Todd's gear as evidence. Todd drove to California last week and received his stolen gear---fortunately still in very good condition.

    Justin from HeadAmp may never get his two aluminum blanks back, but I'm sure he doesn't care. His help bringing these criminals to justice, people that hurt Todd, is by far his greatest reward. Great job, mate!

    130403_Blog_Busted_Applause

    Also a huge shout-out to the Torrance PD! In these times of ever shrinking budgets these guys seemed to have pulled out all the stops to be extraordinarily responsive and effective. The headphone community thanks you!

    The Moral of the Story
    The moral of this story, if there is one, is this: It is WAY harder being a small specialty company in high-end audio than you might think. When I worked at HeadRoom we had about one case of being ripped-off per month. This, among many other things, is a hidden cost that very few enthusiasts think about when buying from these companies. It really sticks in my craw when people look at the parts cost inside an electronic product and complain, "Why does the gear cost ten times as much as the parts in it?" Well, advertising, employee health care, R&D, and myriad other expenses occur in the normal course of business. And on top of that, small, on-line business firms have to deal with all sorts of caustic problems like credit card fraud and cyber attacks.

    My hope, dear reader, is that you'll be just a little more understanding of the enormous effort it takes to to bring specialty products to your doorstep. Paying a fair price for product received is a bit easier when you realize the price these vendors/makers pay to bring product to this market is often far from fair. And if you get asked to present a lot of verifications or maybe have to follow strict shipping policies, it's because these guys have to be very careful.

    Oh, and if you've got a yen for a Pinnacle headphone amp or a pair of E.A.R. 503 mono-blocks, I hear Todd at TTVJAudio.com has some that come with one hell of a story.
    engtaz

    I love how music can brighten up a bad day.

    Comment


    • #3
      Nice to read a story about a thief coming to justice. Weird that the UPS office didn't check the picture with the "owner."

      ID theft is one of the biggest crimes going now.

      Comment


      • #4
        I DO love it when the good guys get the bad guys. :applause:
        Jack

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        • #5
          Great story, unfortunately though 99% of all those types of crimes go unsolved.
          Current System
          Amps Sunfire TGA7400
          Mackie 1400i
          Crown XLS-1500
          Receiver:Sunfire TGP5
          Speakers: Klipsch KLF-30
          Jamo D8 CEN
          Chase SS-18.2
          2x Lilmike Cinema f20

          Video:Epson 3010 3d 1080p, 130in perforated screen

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