Online marketplaces have become the default way Americans buy and sell used goods, find rental housing, and hire local services. Craigslist, Facebook Marketplace, OfferUp, Mercari, and Poshmark collectively facilitate billions of dollars in transactions annually. But the same features that make these platforms convenient (anonymity, speed, and minimal verification) also make them fertile ground for fraud.
The Federal Trade Commission received more than 330,000 reports of online shopping and marketplace fraud in 2025, with reported losses exceeding $4.2 billion. The actual figure is almost certainly higher, since many victims don’t report losses. Scam tactics have evolved significantly in recent years, with fraudsters leveraging artificial intelligence, deepfake technology, and sophisticated social engineering to exploit buyers and sellers alike.
This guide covers the most common scam types by platform, the payment methods that put you at greatest risk, how to verify sellers before committing money, what to do if you have been scammed, and state-specific resources for reporting fraud.
Platform-by-Platform Breakdown
Craigslist
Craigslist remains one of the most widely used classified advertising platforms in the United States, with approximately 250 million monthly visits. Its minimal user verification and anonymous posting system make it a persistent target for fraudsters.
Rental scams are the most financially damaging category on Craigslist. Scammers copy legitimate rental listings (including photos, descriptions, and sometimes even floor plans) and repost them at below-market prices to attract interest. They then request deposits, first month’s rent, or application fees via wire transfer, Zelle, or cryptocurrency before the victim can visit the property. The FBI’s Internet Crime Complaint Center (IC3) estimates that rental fraud costs Americans more than $400 million annually, with Craigslist being the leading platform.
Red flags for Craigslist rental scams include:
- Prices significantly below market rate for the area
- Landlords who claim to be out of town or overseas and can’t show the property in person
- Requests for payment before a lease is signed or the property is viewed
- Listings that use stock photos or photos that appear in reverse image searches as belonging to different properties
- Communication exclusively through email or text, with refusal to speak by phone or video call
Vehicle scams are another Craigslist staple. Fraudulent vehicle listings typically offer desirable cars or trucks at below-market prices, with elaborate stories explaining the discount (military deployment, divorce, estate sale). The scammer requests a deposit to “hold” the vehicle, often through an escrow service that turns out to be fraudulent. A less common but more sophisticated variant involves sellers who possess a vehicle but have altered the odometer, concealed accident damage, or are selling a car with a salvage title that has been washed through out-of-state registration.
Overpayment scams target Craigslist sellers. A buyer sends a cashier’s check or money order for more than the asking price, then asks the seller to wire back the difference. The check eventually bounces, but the wired funds are gone. Despite being one of the oldest scam formats in existence, overpayment fraud continues to succeed because fraudulent cashier’s checks can take weeks to be identified by banks.
Facebook Marketplace
Facebook Marketplace has grown rapidly since its 2016 launch, with more than one billion monthly users globally. The platform’s integration with Facebook profiles provides a veneer of accountability (buyers and sellers can see each other’s names, profile photos, and mutual friends) but this transparency is easily exploited.
Fake product listings are the most common Facebook Marketplace scam. Scammers post listings for popular items (electronics, furniture, vehicles, concert tickets) at attractive prices, collect payment through peer-to-peer platforms, and either ship counterfeit goods, ship nothing at all, or ghost the buyer after payment is received. Facebook’s internal data indicates that electronics (particularly gaming consoles, smartphones, and laptops) are the most frequently reported scam category.
Shipping scams have proliferated as Facebook Marketplace has expanded beyond local pickup to include shipped items. Scammers may request payment outside of Facebook’s checkout system (which offers buyer protection for shipped items) to avoid refund liability. Others use fake tracking numbers that show as “delivered” to a zip code near the buyer, even though the package was never sent to the correct address.
Impersonation and identity theft represent a growing threat on Facebook Marketplace. Scammers create fake profiles using stolen photos and personal information, build credibility by joining local buy/sell groups, and then defraud buyers or sellers. A particularly insidious variant involves scammers who request that buyers send a verification code to “confirm” their identity. In reality, the code is a Google Voice or two-factor authentication code that allows the scammer to hijack the buyer’s accounts.
Deposit scams for high-value items have increased in frequency. For items like vehicles, furniture sets, or appliances, sellers may request a deposit to “hold” the item, then become unresponsive. Alternatively, a scammer posing as a buyer may offer to pay a deposit for an item, send a fraudulent payment notification (often a spoofed Zelle or Venmo screenshot), and then pick up the item before the seller realizes no payment was received.
OfferUp
OfferUp, which merged with Letgo in 2020, positions itself as a safer alternative to Craigslist, with user verification features including TruYou identity verification and in-app messaging. However, scams persist.
TruYou badge manipulation is a concern. While TruYou verification requires users to submit a photo ID, some scammers use stolen identity documents to obtain verification, lending false credibility to fraudulent listings. The badge should be considered a positive signal, not a guarantee of legitimacy.
In-person robbery is a more serious risk on OfferUp and similar platforms that facilitate local transactions. Scammers arrange to meet sellers for high-value items (electronics, jewelry, vehicles) in isolated locations and then rob them. OfferUp and local police departments have responded by establishing designated safe exchange zones (often in police station parking lots), but not all users are aware of these options.
Bait-and-switch tactics involve sellers who post an item at an attractive price, then claim it has been sold when a buyer expresses interest and attempt to redirect the buyer to a more expensive or inferior alternative. While less financially damaging than outright fraud, bait-and-switch tactics waste time and can lead to impulse purchases of overpriced items.
Payment Method Risk Assessment
The payment method you use is the single most important factor in determining whether you can recover money lost to a scam. Understanding the risk profile of each payment method is essential.
Highest Risk: Wire Transfers
Wire transfers (Western Union, MoneyGram) are effectively irreversible once sent. They are the payment method of choice for scammers precisely because recovery is nearly impossible. The FTC has explicitly warned consumers never to wire money to someone they haven’t met in person. If a seller requests wire transfer payment, treat it as a near-certain indicator of fraud.
High Risk: Peer-to-Peer Payment Apps (Zelle, Venmo, Cash App)
Zelle, Venmo, and Cash App are designed for payments between people who know and trust each other. They offer minimal or no buyer protection for marketplace transactions. Zelle, which is integrated into most major bank apps, is particularly problematic because consumers often assume that its bank affiliation provides protection. It doesn’t. Zelle transactions are treated as authorized by the sending bank, and chargebacks are generally not available for completed payments.
Venmo offers a Goods and Services payment option that provides some buyer protection, but scammers typically request the Friends and Family option, which doesn’t. Cash App’s dispute process is limited and frequently unsuccessful for marketplace fraud.
High Risk: Cryptocurrency
Bitcoin, Ethereum, and other cryptocurrency payments are irreversible by design. While cryptocurrency isn’t commonly used in casual marketplace transactions, it appears in higher-value scams, particularly those involving electronics, vehicles, and investment-related fraud. Never pay for marketplace goods with cryptocurrency.
Moderate Risk: Personal Checks and Cashier’s Checks
Personal checks can bounce, and cashier’s checks can be counterfeited. The critical risk is timing: banks often make funds available from deposited checks before the check has fully cleared, creating a window during which a buyer or seller believes they have been paid when they haven’t. The full clearing process for checks can take up to two weeks, and a check that appears to have cleared can still be returned as fraudulent.
Lower Risk: Credit Cards and PayPal Goods & Services
Credit cards offer the strongest consumer protection of any payment method. The Fair Credit Billing Act provides the right to dispute unauthorized charges and charges for goods not received. Most credit card issuers have dispute processes that are favorable to consumers, with provisional credits issued within days.
PayPal’s Goods and Services protection similarly provides dispute resolution and refund capability, though the process can be slower than credit card disputes. PayPal’s Friends and Family option, like Venmo’s equivalent, offers no buyer protection.
Lowest Risk: Cash (for in-person transactions)
For local, in-person transactions, cash eliminates most payment-related fraud risks. The buyer can inspect the item before handing over payment, and there’s no risk of chargebacks, bounced checks, or digital payment manipulation. The primary risk is counterfeit currency, which can be mitigated by using a counterfeit detection pen or meeting at a bank.
How to Verify Sellers Before You Buy
Due diligence before committing money can prevent the vast majority of marketplace fraud. The following verification steps take minutes and can save thousands.
Reverse image search the listing photos. Upload the listing images to Google Images or TinEye. If the photos appear on other websites, other marketplace listings, or stock photo sites, the listing is likely fraudulent. Legitimate sellers use their own photos, which won’t appear elsewhere online.
Check the seller’s profile history. On Facebook Marketplace, review the seller’s profile creation date, posting history, and friend count. Recently created profiles with few friends and no history of legitimate activity are suspect. On OfferUp, check the seller’s rating, number of completed transactions, and how long their account has been active.
Request additional photos or a video call. Ask the seller to send photos of the item from specific angles or with a specific item (like a piece of paper with today’s date) placed next to it. Scammers using stolen photos will be unable to comply. For high-value items, request a video call where the seller shows the item in real time.
Verify vehicle information independently. For vehicle purchases, obtain the VIN and run a vehicle history report through Carfax or AutoCheck. Verify that the VIN on the report matches the VIN on the vehicle’s dashboard and door jamb. Check for open recalls, accident history, title status, and odometer discrepancies.
Search the seller’s phone number and email. Enter the seller’s contact information into a search engine. Phone numbers and email addresses associated with scams often appear in online fraud databases and consumer complaint forums.
Meet in a public, surveilled location. For in-person transactions, insist on meeting at a police station safe exchange zone, a bank lobby, or another public location with security cameras. Never go to a seller’s home for a first meeting, and never invite a stranger to yours.
Trust your instincts. If a deal seems too good to be true, it almost certainly is. Scammers rely on the urgency and excitement of a perceived bargain to override buyers’ better judgment. A legitimate seller won’t pressure you to make an immediate decision or payment.
What to Do If You Have Been Scammed
If you have fallen victim to a marketplace scam, take the following steps immediately:
1. Document everything. Screenshot all communications, listing details, payment confirmations, and any other evidence. This documentation will be essential for fraud reports and potential recovery.
2. Report to the platform. File a fraud report with the marketplace where the scam occurred. Facebook, Craigslist, and OfferUp all have reporting mechanisms, and reports contribute to the removal of fraudulent listings and accounts.
3. Contact your financial institution. If you paid by credit card, initiate a chargeback dispute immediately. If you paid by Zelle, Venmo, or Cash App, file a fraud report with the platform and your bank, though recovery is less likely. If you paid by wire transfer, contact the wire service (Western Union or MoneyGram) to request a recall, though success rates are low once funds have been collected.
4. File a report with the FTC. The Federal Trade Commission accepts fraud reports at ReportFraud.ftc.gov. While the FTC doesn’t resolve individual complaints, reports contribute to enforcement actions against patterns of fraud and provide data that shapes consumer protection policy.
5. File a report with the FBI’s IC3. The Internet Crime Complaint Center (ic3.gov) accepts reports of internet-facilitated fraud. IC3 referrals have led to the recovery of funds in some cases, particularly for wire transfer fraud where the funds haven’t yet been withdrawn.
6. File a local police report. While local police may not investigate individual cases of online fraud, a police report creates an official record that can support insurance claims, credit card disputes, and civil litigation.
7. Monitor your credit. If you shared personal information (Social Security number, bank account numbers, driver’s license) during the scam, place a fraud alert or credit freeze with the three major credit bureaus (Equifax, Experian, TransUnion). Monitor your credit reports for unauthorized accounts or inquiries.
The Chargeback Process Explained
For victims who paid by credit card, the chargeback process is the most effective recovery mechanism. Here’s how it works:
Initiation: Contact your credit card issuer (the number on the back of your card) and state that you want to dispute a charge. Specify the reason, most commonly “goods not received” or “goods not as described” for marketplace fraud.
Provisional credit: Most issuers will provide a provisional credit to your account within one to two billing cycles while the dispute is investigated. This credit is temporary and may be reversed if the dispute isn’t resolved in your favor.
Investigation: The issuer investigates the dispute, which may involve contacting the merchant (in this case, the scammer or the payment processor). You may be asked to provide documentation supporting your claim.
Resolution: Disputes are typically resolved within 60 to 90 days. For straightforward cases of marketplace fraud (where goods were not received) resolution rates strongly favor the consumer. The Fair Credit Billing Act limits consumer liability to $50 for unauthorized charges, though most issuers waive even this amount.
Time limits: You must initiate a chargeback within 60 days of the statement date on which the charge appeared. Do not delay.
State-Specific Resources
Consumer protection enforcement varies by state. Most states maintain consumer protection divisions within the Attorney General’s office that can assist with fraud complaints and, in some cases, pursue enforcement actions.
Idaho residents can file consumer complaints with the Idaho Attorney General’s Consumer Protection Division at ag.idaho.gov or by calling (208) 334-2424. The division handles complaints about deceptive business practices, including online marketplace fraud. Idaho’s Consumer Protection Act (Idaho Code Title 48, Chapter 6) provides civil remedies for victims of deceptive practices, including the potential for treble damages in cases of willful violations.
California residents should contact the California Department of Justice’s Office of Consumer Protection. California’s consumer protection laws are among the strongest in the nation, and the state has been active in pursuing enforcement actions against online marketplace fraud.
Texas residents can file complaints with the Texas Attorney General’s Consumer Protection Division. Texas has the authority to pursue civil penalties of up to $10,000 per deceptive trade practice violation.
New York residents should contact the New York Attorney General’s Bureau of Consumer Frauds and Protection. New York’s consumer protection laws provide strong protections, including the ability to recover attorney’s fees in successful fraud claims.
Florida residents can file complaints with the Florida Attorney General’s Division of Consumer Protection. The Florida Deceptive and Unfair Trade Practices Act provides broad protections against marketplace fraud.
For residents of other states, the National Association of Attorneys General (naag.org) maintains a directory of all state attorney general offices with links to consumer complaint filing systems.
Emerging Threats: AI-Powered Scams in 2026
The rapid advancement of artificial intelligence has introduced new fraud vectors that marketplace users should be aware of.
AI-generated product photos allow scammers to create realistic images of items that don’t exist. Unlike stolen photos, AI-generated images won’t appear in reverse image searches, defeating one of the most reliable verification techniques. Look for telltale signs of AI generation: inconsistent lighting, blurred text on labels, or objects that don’t quite conform to physical reality.
Deepfake video calls are an emerging threat for high-value transactions. Scammers can use real-time deepfake technology to impersonate sellers during video calls, defeating the “request a video call” verification technique. While current deepfake technology still has detectable artifacts (slight lip-sync mismatches, unnatural blinking, inconsistent lighting on the face), the technology is improving rapidly.
AI-powered chatbots allow scammers to operate multiple fraud schemes simultaneously, maintaining convincing conversations with dozens of potential victims at once. These bots can adapt their communication style, respond to questions intelligently, and maintain consistent personas across extended interactions.
Voice cloning enables scammers to replicate the voice of a real person (such as a legitimate seller whose identity has been stolen) using just a few seconds of sample audio obtained from social media or voicemail greetings.
The best defense against AI-powered scams remains the fundamentals: verify independently, use protected payment methods, meet in person for local transactions, and maintain healthy skepticism about deals that seem too good to be true.