Domain Name Appraisal Scam

Yesterday, I came across a domain name appraisal scheme that I thought I’d share here –it is actually somewhat clever, and I wouldn’t want anyone to fall for it…

I received an e-mail with the promising title: “Offer for your domain EDUXY .ORG”.

A few years ago, I had registered that domain name because I wanted to launch a site about low-cost (possibly open source) educational software. Unfortunately, I haven’t had much time to work on that project because of other obligations, but I certainly had no plans to sell the domain. Still, the e-mail sounded… let’s say: intriguing.

It read:

We are interested to buy your domain name EDUXY .ORG and offer to buy it from you for 75% of the appraised market value.

As of now we accept appraisals from either one of the following leading appraisal companies:

fleos.com

sedo.com

If you already have an appraisal please forward it to us.

As soon as we have received your appraisal we will send you our payment (we use paypal for amounts less than $2,000 and escrow.com for amounts above $2,000) as well as further instructions on how to complete the transfer of the domain name.

We appreciate your business,

Yours truly,

Steven Harris

Now, it’s hard to say what the “market value” of a domain like eduxy.org would be –on the one hand, it is relatively short and quite “brandable”, IMO; on the other hand, it is a .org, not a .com, and not a “generic” term (like “education”).

Let’s assume, for argument’s sake, that the domain would be worth around $2,000. That would mean that Mr. Harris would be willing to pay around $1,500 for a domain I wasn’t actively using –tempting, no?!

The e-mail also mentioned the use of an escrow service, which somewhat alleviated my fears of not receiving any payment after I had transferred the domain.

What, then, was the catch? There didn’t seem to be one…

The only thing I had to do was to get an appraisal from one of the “leading appraisal companies” mentioned.

Hang on.

Anyone who knows anything about “domaining” has heard of Sedo, a company that helps you buy and sell domain names, lets you “park” your domains to monetize them, and offers domain name appraisals for $29 per domain.

But what about “Fleos”?

That “company” has a rather amateurish web site that takes forever to load. (I won’t link to it for reasons that will become apparent in a minute.)

Once you select the “Purchase” tab, you’ll get a list of their “Domain Appraisal Prices”; they start at $22.99 for a single domain.

The site also features an “Industry Leading Guarantee”: if you can’t sell the domain for the appraised price within 6 months, Fleos will either refund the appraisal fee or buy the domain from you.

Sound too good to be true? That’s because it is.

If you look at their Whois data, you’ll see that the domain was registered on July 4th, 2009 –less than a month ago… (And oh, yeah, it uses a Whois protection service to hide the name of the owner.)

So this is how the scam works: they contact unsuspecting domain owners, offering to buy the domain name for 75% of its appraised value. However, they will only accept appraisals from two sites; one of them is undoubtedly owned by them, and it charges $6 less than the alternative site.

They’re hoping that domain owners will either pick the less expensive appraisal service, or get an appraisal from both services (and offer the higher appaised market value as “evidence”, of course).

What happens next? Nothing, I suspect.

I would be very surprised if people hear back from Mr. Harris after they have sent him their freshly-ordered market value appraisals –especially since he uses one of those Gmail addresses that sometimes can be, you know, hard to get through to… ;-)