You may have recently seen tempting Facebook ads proclaiming unbelievable deals from major retailers like Bed Bath & Beyond, Walmart, Lowes, or Wilko liquidating inventory at 90% off due to bankruptcy. But before you click, know that these viral “Bankruptcy Liquidation” ads are a deceptive scam trying to fool social media users out of their money.
This comprehensive guide will uncover how this brazen scam works, techniques used to trick victims, and most importantly – how to identify and avoid getting ripped off by these fake bankruptcy liquidation sale scammers.
This Article Contains:
Scam Overview
The Bankruptcy Liquidation Clearance Sale scam employs highly deceptive social media advertisements and convincing sham e-commerce websites to defraud victims out of their money.
Here are a few key points about why this Bankruptcy Liquidation Clearance Sale ad is a scam:
- The ad uses clickbait phrases like “BREAKING NEWS” and “Don’t Miss Out!” to create false urgency and pressure people into buying quickly. This is a common tactic of online scams.
- Promising “Up to 90% Off All Items” is highly suspicious and unrealistic for a major retailer to offer across the board. Legitimate closing sales may offer discounts, but not 90% off everything.
- Secure credit card payments and 24-hour delivery are enticing promises, but likely empty given that this is not the real website. Victims who purchase will likely have their credit card info stolen with no items ever shipped.
- No actual locations are mentioned as closing down or liquidating inventory. The ad is vague, just urging people not to “miss out.” If it was a real closing sale, specific store information would be provided.
- This ad appeared only on Facebook, not on the site official website or social media pages. Scammers create fake accounts and ads to lure victims.
Scammers link these ads to sophisticated fake online storefronts impersonating well-known retailers like Bed Bath & Beyond, JCPenney, Kohl’s, or Walmart. These sites claim the brands are liquidating all merchandise and closing stores permanently due to declaring bankruptcy.
In reality, these sites are elaborate fraudulent shells used to scam users who think they are getting blowout clearance discounts on their favorite brands due to bankruptcy. After checkout, customers never receive any items ordered. The fake scam websites quickly disappear, preventing victims from pursuing refunds.
Some common traits exposing these viral closing sales as scams include:
- The website domain was registered immediately prior to launch of the fake liquidation sale. Scammers only create the sites temporarily to execute their fraud.
- No public bankruptcy filing or announcement exists for the major brand supposedly closing down. This would be major news covered by media outlets.
- Prices discounted to an unrealistic degree, like 90% or even 95% off all merchandise including popular items customers would buy at full price.
- Countdown timers and limited purchase windows pressure buyers to act fast before the unclear deadline expires. This urgency distracts from evaluating legitimacy.
- Email is the only form of customer contact, using a domain name unrelated to the company. There are no working customer service phone numbers.
- The company’s logo appears slightly altered or pixelated on scam sites compared to the real brand’s.
- No social media presence exists beyond the temporary scam ads. Searching online yields no history or satisfied customer reviews.
With no physical stores attached to the liquidation, no valid contact information, no company history, and no permanent web presence, these sham retailer websites essentially vanish after collecting victim’s money. The deceivingly realistic store templates and targeted ads enable an intricate cash grab bilking social media users seeking unbelievable deals.
How the Bankruptcy Liquidation Scam Works
The scam starts with compelling social media ads announcing a major retailer like JCPenney or Kohl’s is liquidating inventory due to declaring bankruptcy. The ads tout blowout fire sale discounts up to 95% off everything as they close stores nationwide.
When users click through to the store’s website, the polished site looks very legitimate at first glance. Merchandise appears drastically marked down in all departments with urgent messages to take advantage before stock runs out.
No indication appears about which physical locations are actually closing. And despite the massive sell-off claims, there’s no option for in-store pickup.
Countdown timers ratchet up the pressure to purchase immediately before the unclear deadline expires. Contact is only available through an email address on the site.
After checkout, no order confirmations get sent and the website soon becomes unreachable. No products ever ship out, but victims’ payment information was already stolen during the fake purchase process.
Some users eventually receive cheap counterfeit items weeks later that barely resemble what was ordered. Most get nothing. Requests for refunds are futile as the sites vanish quickly after collecting payments during the short-term scam.
A handful of customers can get credit card charges reversed as fraudulent. But most victims have no recourse beyond eating the loss, unable to even identify the scammers behind the phony liquidation sales.
How to Spot This Scam
While scam sites appear convincing at first glance, several red flags can help identify their fraudulent nature:
Check for a Legitimate Domain Name and Company Details
- Fake sites often have domain names with odd spellings, extra words or use popular brand names. Search the company name online to confirm they are real.
- Check that a physical business address, working customer service phone/email are provided. Lack of real contact details indicates a shady seller.
Look for Overly Good-to-Be-True Deals
- Scam websites lure customers by advertising extravagant discounts of 50-90% off or deals well below market prices. Real businesses cannot sustain such heavy losses. If the deal looks too good to be true, it likely is.
Verify Company Reputation
- Search the website, business name and owner names online for any negative reviews or scam reports. Check with BBB, TrustPilot and complaint forums to see their reputation.
- No social media presence and zero signs of real customer activity on review sites signal likely frauds.
Analyze Site Security and Payment Options
- Ensure sites connect with SSL encryption and have guaranteed refund policies. Unsecured sites should not handle payments or sensitive data.
- Scam websites tend to only take irreversible payments like wire transfers, gift cards, cryptocurrency and avoid credit cards with stronger fraud protections.
Spot grammar errors, plagiarized policies, limited products
- Fake sites lack effort invested into proper grammar and original legal policy writing seen on established businesses.
- Very limited product selections avoiding common best-selling items categories also indicates pop-up scams.
Carefully applying these warning signs allows shoppers to expose scam retail fronts seeking solely to exploit rather than serve legitimate customer bases built on accountability and trust.
How to Spot This Scam on Social Media
In tandem with operating entirely fake e-commerce storefronts, retail scam websites heavily leverage sponsored social media ads promoting unbelievable yet highly compelling deals up to 90% off across product ranges in attempts to lure target audiences.
Highly deceptive posts explicitly screaming too-good-to-be-true price cuts frequently overrun Facebook feeds, Instagram stories and TikTok streams with aims of deceiving deal-seeking shoppers. However, certain patterns across these advertisements expose their underlying deceitful intentions.
Spotting Fraudulent Facebook Ads
Beware of too-good-to-be-true deals in Facebook ads like “90% off” or “Free Shipping” that entice people to shop. Scammers know how lucrative Facebook’s 2 billion users can be. Warning signs of a scam Facebook shopping ad:
- Extreme discounts such as “Store Closing Sale” or “Going out of Business” that seem suspicious for a newly created page. Legitimate businesses usually don’t heavily discount new inventory.
- Language and grammatical errors or inconsistencies throughout the ad or website. This signals the scammers likely quickly generated the content.
- Generic stock images of products rather than real images. Or images with watermarks that the scammer likely didn’t have rights to use.
- Very recent Page creation date shown under the Page name. Scam sites don’t last long before users report them or Facebook removes them.
If an ad or Page sets off warning bells, search for reviews of the website before purchasing. Or reverse image search any product photos to see if they were stolen from another site. Don’t support scammers taking advantage of Facebook users.
Spotting Fraudulent Instagram Ads
Scam online shopping sites try luring Instagram users with attention-grabbing captions like “Limited Time Offer!” and enticing prices such as “Today Only $39”. But is the Instagram shop legit or a scam? Signs to help determine:
- The account has very few posts and followers. Scams setup disposable accounts that get deleted once reported.
- Check user tags on the posts. If real people aren’t shown wearing or using the products, that’s a major red flag.
- Tap on the shop link in the bio. If there’s no HTTPS or SSL certificate, it’s not secure to enter payment information.
- Reviews seem fake or non-existent. Scam sites don’t have much satisfied customer proof.
- Limited or vague return policy information. Or difficult channels to request a return.
Trust your instinct if an Instagram shop seems fishy. Check independent review sites first before buying through an unknown seller advertising on Instagram. Protect your personal and payment information entering it only on secure sites after verifying legitimacy.
Catching Fake TikTok Ads
Scam TikTok shopping sites try attracting traffic using compelling videos showcasing unbelievable deals. But amazing discounts and prices may bait unsuspecting TikTok users into a scam. Be wary of:
- Links in the caption or videos bringing users to store sites no one’s heard of. Scammers setup temporary sites that won’t be around long.
- No blue checkmark verification badge on the account. This signals TikTok hasn’t authenticated the authenticity of the seller.
- Prices drastically slashed with countdown timers pressuring purchase decisions. Scare tactics rush rational judgement.
- No reviews or evidence showing real customers enjoying the products. Easy with video testimonials to fake satisfaction.
Check comment sections on TikTok scam shopping site videos for warnings from others getting duped. When prices seem too good to be true, they most likely are. Verify legitimacy before handing payment info to unknown sellers promoting on TikTok videos. Your security comes first.
What To Do If You Are A Victim
If you have fallen victim to this scam, you should take immediate action to protect yourself and your money. Here are some steps that you can take:
- Contact your bank immediately – Alert your bank to disputed charges and consider canceling your card to prevent further fraudulent purchases.
- Keep records – Save receipts, emails, screenshots, and any details related to the transaction. This provides proof of the scam.
- File a complaint – Report the fraud to the FTC and Internet Crime Complaint Center. Provide any relevant records.
- Leave online reviews – Post details of the scam on consumer review sites to warn others. However, don’t defame legitimate businesses.
- Report social media accounts – If the scam involved social media, report the accounts to get them removed.
- Reverse payments – If you paid with a credit card, request a chargeback. For wire transfers, contact the recipient bank to possibly reverse it.
- Check credit reports – Request credit reports to check for any accounts opened fraudulently using your information. Consider placing a credit freeze if needed.
- Reset account passwords – Change passwords on any online accounts that used the same login credentials entered on the scam site.
- Check your device for viruses – Run a Malwarebytes Anti-Malware Free scan to check for any malware that may have infected your device through the site.
- Learn from the situation – Study how you were deceived so you can avoid other scams in the future.
Being vigilant against shopping scams and acting quickly when scammed can help limit financial and identity theft impact. Report it to help authorities investigate and shutdown scam sites that are still active.
FAQ
What is the bankruptcy liquidation sale scam?
It’s a scam where fake ads and sites pretend popular retailers are liquidating due to bankruptcy with unrealistic discounts. But it’s a ploy to steal money.
How does the bankruptcy sale scam work?
Scammers use ads to drive traffic to convincing fake sites with unbelievable prices. After checkout, no items are ever shipped to victims.
What are some red flags of this scam?
Prices like 90% off everything, fake countdown timers, no physical location details, new domains, altered logos, email-only contact.
What happens after I order?
Most likely your order disappears with no confirmation. The sites quickly vanish after the “sale,” preventing refunds.
Can I get a refund if I was scammed?
If you paid by credit card you may be able to dispute the charges for non-receipt of goods. File complaints immediately.
Why do they impersonate real retailers?
To make the liquidation sales appear legitimate. Established brand names trick users into believing the unrealistic deals.
Do they ever ship any actual products?
In rare cases, victims report getting random, cheap items weeks later that significantly differ from their order.
How can I spot these scams before ordering?
Research unfamiliar sellers claiming huge discounts. Watch for new site domains and lack of location specifics.
Why such extreme discounts like 90-95% off?
Massive markdowns create urgency to buy before scrutinizing validity. Huge deals also attract more potential victims.
How can I avoid becoming a victim?
Carefully vet unfamiliar sellers and unrealistic discounts. Avoid direct money transfers. Use credit cards with protections.
Conclusion
The viral Bankruptcy Liquidation Clearance Sale scam capitalizes on the disappointment of missing huge blowout discounts from favorite retailers. But the jaw-dropping deals actually mask sophisticated shams just trying to steal money through deception.
Carefully researching unbelievable markdowns, website details, company standing, and avoiding pressure sale tactics is key to not getting duped. Staying vigilant allows social media users to steer clear of these bankruptcy liquidation scams exploiting those desperately seeking deals.
