The Better Business Bureau Serving Central & South Alabama is warning heavy equipment vendors that they may unknowingly be involved in a scam that has already resulted in $1.5 million in losses.
“It’s just the most incredible kind of thing,” says Carl Bates, president and CEO of the BBB. “It’s the same scammer going from place to place, using Alabama, I guess, because we’re so rural, as the patsy in the deal.”
What’s happening, Bates says, is that someone is setting up shop online, using real companies — mostly companies that have closed, but a few that are still operating — so that they look legitimate. If someone Googles the company, they’ll find a website that looks legitimate, so potential buyers feel comfortable proceeding with the online transaction.
The scammers post items for sale on Craigslist, Facebook Marketplace, Truck Trader and other sites, collect thousands of dollars in deposits and never deliver on the equipment.
Bates says the scammers have used companies in Millbrook, Beatrice, Albertville and other Alabama communities. Once they’re discovered, they quickly set up another fake company. The FBI began investigating, and the agency has recently turned the investigation over to the cyber-criminal division of the Secret Service, Bates says.
The BBB estimates the amount of loss so far to be $1.5 million, though Bates says that figure is probably a low estimate. Another problem? Legitimate businesses are losing business because Alabama is known to have this scam occurring. “Alabama is getting a bad name,” Bates says. “Some people think, ‘Don’t buy anything from Alabama because it may be a criminal.’”
Bates says the BBB does have some suggestions to avoid the scam.
“One, if you’re going to buy heavy equipment sight unseen, that’s a mistake,” he says. “If it’s that kind of an investment, it’s worth a plane ticket or a drive to see what you’re buying. … At the very least, before you make a major purchase, call us and check it out first.”
Businesses won’t know they’re part of the scam until someone files a complaint or starts asking questions, Bates says.
“Businesses in our area are in real danger of having their identity stolen, and basically, they wouldn’t even know it,” he says. “A lot of times, the actual business may not know for months that it’s happening, until we get a call asking if they’re a legitimate business. That’s why it has gone on for so long. We may not find the new fake location for a month, until a consumer calls.”
Alabama isn’t the only place this scam is happening.
“We’ve seen this a couple of times in Indiana and southern Illinois, other rural areas, but not to the extent that it’s happening here,” Bates says. “They are preying on smaller businesses out there in rural areas, where there’s very little media, no investigative reporters, not a lot of people trying to dig this out and publicize it.”