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buzz2021
Community Member

Client wanted to buy Crypto/ Crypto scams/ Payment reversed

A client recently wanted to buy cryptocurrencies (**Edited for Community Guidelines**) on Upwork. I accepted the offer and the client put the money in an escrow account. I thought that my money would be covered as far as I can show proof that work was done. After I sent the coins to the client's coinbase exchange wallet, he paid me through upwork immediately. So, the money was moved to "Pending" in my report. However, I received an email from upwork support today and they reversed the payment and the client was removed from marketplace because of fraud. This really surprised me that money can be taken away from my account so easily! So, please be wary of these sort of scams. I think several freelancers have sent him/ her coins.

 

Probably is a scam, not yet confirmed. The matter is still under investigation by the upwork team.

 

Does upwork still hold the money while this is being investigated or has it already been returned to the client?


Email from upwork support:
**Edited for Community Guidelines**

17 REPLIES 17
petra_r
Community Member


Kian Foong L wrote:

 

Probably is a scam, not yet confirmed.


Oh it's confirmed to be a scam...

 

Are you the person who had already sent the scammer โ‚ฌ6000 of his own money in untraceable crypto currency they can't ever get back by the time Upwork noticed the $10k scam? Or another victim?

buzz2021
Community Member

Thanks for the reply. I sent the guy a total of $1,000 (4000 XLM) in terms of coins. The payment for the first part/ job was approved and I received $320 ($400 - 20% fees) in my "earnings". The rest was reversed.

Will the payment for $320 be reversed as well?

petra_r
Community Member


Kian Foong L wrote:

Thanks for the reply. I sent the guy a total of $1,000 (4000 XLM) in terms of coins


Oh dear... I really don't know what you were thinking. How did you think for a minute that this was going to be legitimate and work out? You must have wondered why anyone would pay over $1600 for $1000 in crypto to a complete stranger on the Internet?

 


Kian Foong L wrote:

Will the payment for $320 be reversed as well?


Somewhere between maybe and probably...

buzz2021
Community Member

Alright, I've learned my lesson. Thanks ๐Ÿ˜„

Hey, Did you get back your money?


Sami U wrote:

Hey, Did you get back your money?


There is no way to get back the money once it was sent via crypto currency.

Hello Petra,
Thanks for your time.  ActyuallyToday a job was posted where the Client wanted to buy crypto from us(Freelancers ) and then pay us through Upwork. Because I had Crypto and needed to sell it so I applied for the Job. He Paid milestones and the payment became Pending. So I thought It was legal and sent him Crypto from my wallet. But I had a feeling that it could be a scam SO now upon Researching I found this community Post as his funds are now reversed. It's really sad someone on Upwork can come and take out Freelancers' hard-earned money so easily. My funds are still in pending, Can I do anything to save them? Well, I've contacted Upwork support and explained everything. I wish I had researched before getting trapped.


Sami U wrote:

Hello Petra,
Thanks for your time.  ActyuallyToday a job was posted where the Client wanted to buy crypto from us(Freelancers ) and then pay us through Upwork. Because I had Crypto and needed to sell it so I applied for the Job. He Paid milestones and the payment became Pending. So I thought It was legal and sent him Crypto from my wallet. But I had a feeling that it could be a scam SO now upon Researching I found this community Post as his funds are now reversed. It's really sad someone on Upwork can come and take out Freelancers' hard-earned money so easily. My funds are still in pending, Can I do anything to save them? Well, I've contacted Upwork support and explained everything. I wish I had researched before getting trapped.


The moment you agree to transfer Crypto currency, you are agreeing to make a payment outside Upwork = ToS violation.  Your money is gone.

Hello Jennifer,
I know accepting payment outside of Upwork is against Upwork policies and I have never done it. 
Because He was paying me through Upwork So I accepted his offer and got Trapped. I learned my lesson anyway.


Sami U wrote:

Hello Jennifer,
I know accepting payment outside of Upwork is against Upwork policies and I have never done it. 
Because He was paying me through Upwork So I accepted his offer and got Trapped. I learned my lesson anyway.


You are using Upwork wrongly and need to re-read the User Agreement and overall ToS maybe some basics.

a) A crypto transfer is not a Freelancer Service if you also provide the crypto. In this case you are selling goods.

b) All payment are made in US$. Using a different (crypto) currency is just a big no.

c) Accepting payment outside Upwork is not the only "payment related" ToS violation. You need  to request, make, and receive all payments through Upwork.

2. PURPOSE OF UPWORK

Section 2 discusses what Upwork does and does not do when providing the Site and Site Services and some of your responsibilities when using the Site to find or enter into a Service Contract with a Freelancer or Client, as detailed below.
The Site is a marketplace where Clients and Freelancers can identify each other and advertise, buy, and sell Freelancer Services online. Subject to the Terms of Service, Upwork provides the Site Services to Users, including hosting and maintaining the Site, facilitating the formation of Service Contracts, and assisting Users in resolving disputes which may arise in connection with those Service Contracts. When a User enters a Service Contract, the User uses the Site to invoice and pay any amounts owed under the Service Contract
 
6.7 U.S. DOLLARS AND FOREIGN CURRENCY CONVERSION
The Site and the Site Services operate in U.S. Dollars. If a User's Payment Method is denominated in a currency other than U.S. Dollars and requires currency conversion to make or receive payments in U.S. Dollars, the Site may display foreign currency conversion rates that Upwork, Upwork Escrow, or our Affiliates currently make available to convert supported foreign currencies to U.S. Dollars. These foreign currency conversion rates adjust regularly based on market conditions. Please note that the wholesale currency conversion rates at which we or our Affiliates obtain foreign currency will usually be different than the foreign currency conversion rates offered on the Site. Each User, at its sole discretion and risk, may authorize the charge, debit, or credit of its Payment Method in a supported foreign currency and the conversion of the payment to U.S. Dollars at the foreign currency conversion rate displayed on the Site. A list of supported foreign currencies is available on the Site. If foreign currency conversion is required to make a payment in U.S. Dollars and Upwork or its Affiliate, Upwork Escrow or Elance Ltd., as applicable, does not support the foreign currency or the User does not authorize the conversion of such payment at the foreign currency conversion rate displayed on the Site, Upwork Escrow or one of our Affiliates will charge, debit, or credit the User's Payment Method in U.S. Dollars and the User's Payment Method provider will convert the payment at a foreign currency conversion rate selected by the User's Payment Method provider. The User's Payment Method provider may also charge fees directly to the Payment Method even when no currency conversion is involved. The User's authorization of a payment using a foreign currency conversion rate displayed on the Site is at the User's sole risk. Upwork, Upwork Escrow, Elance Ltd., and our Affiliates are not responsible for currency fluctuations that occur when billing or crediting a Payment Method denominated in a currency other than U.S. Dollars. Upwork, Upwork Escrow, Elance Ltd., and our Affiliates are not responsible for currency fluctuations that occur when receiving or sending payments to and from the Escrow Account.
 
7. NON-CIRCUMVENTION
Section 7 discusses your agreement to make and receive payments only through Upwork for two years from the date you first identify or meet your Client or Freelancer on the Site, unless you pay a Conversion Fee; violating this Section 7 is a serious breach and your Account may be permanently suspended for violations, as detailed below.
7.1 MAKING PAYMENTS THROUGH UPWORK
You acknowledge and agree that a substantial portion of the compensation Upwork receives for making the Site available to you is collected through the Service Fee described in Section 5.1 and that in exchange a substantial value to you is the relationships you make with other Users when you identify or are identified by another person through the Site or Site Services (the โ€œUpwork Relationshipโ€). Upwork only receives the Service Fee when a Client and a Freelancer pay and receive payment through the Site. Therefore, except as set out in Section 7.2, for 24 months from the start of an Upwork Relationship (the โ€œNon-Circumvention Periodโ€), you agree to use the Site as your exclusive method to request, make, and receive all payments for work directly or indirectly with that person or arising out of your relationship with that person and not to circumvent the Payment Methods offered on the Site unless you pay a fee to take the relationship off of the Site (the โ€œConversion Feeโ€). For the avoidance of doubt, if you, or the business you represent, did not identify and were not identified by another person through the Site, such as if you and another User worked together before meeting on the Site, then the Non-Circumvention Period does not apply. If you use the Site as an employee, agent, or representative of another business, then the Non-Circumvention Period applies to you and other employees, agents, or representatives of the business or its successor when acting in that capacity with respect to the other User.
By way of illustration and not in limitation of the foregoing, you agree not to:
โ€ข Offer or solicit or accept any offer or solicitation from parties identified through the Site to contract, hire, invoice, pay, or receive payment in any manner other than through the Site.
โ€ข Invoice or report on the Site or in a Conversion Fee request an invoice or payment amount lower than that actually agreed, made, or received between Users.
โ€ข Refer a User you identified on the Site to a third-party who is not a User of the Site for purposes of making or receiving payments other than through the Site.
You agree to notify Upwork immediately if a person suggests to you making or receiving payments other than through the Site in violation of this Section 7 or if you receive unsolicited contact outside of the Site. If you are aware of a breach or potential breach of this non-circumvention agreement, please submit a confidential report to Upwork here.
You acknowledge and agree that a violation of any provision in this Section 7.1 is a material breach of the Terms of Service. Your Account may be permanently suspended and charged the Conversion Fee (defined above) if you violate this Section 7.1. If you refuse to accept any new version of the Terms of Service or elect not to comply with certain conditions of using the Site, such as minimum rates supported on the Site, and therefore choose to cease using the Site, you may pay the Conversion Fee for each other User you wish to continue working with on whatever terms you agree after you cease using the Site.

 

 

Thanks Jennifer for helping me. I've re-read all ToS and User Agreements and will be extra careful next time.


Sami U wrote:

Can I do anything to save them?.


Nothing at all.

 

How did you not suspect right from the first second that it is a scam? No real client would use their own real money to buy crypto at hugely inflated prices. They could just buy it the normal way and pay way less. So that would have been the moment you should have recognized that the "client" was not real and that this would end in tears...

 

The only reason such a "client" would do this is because it is such a neat way to turn a stolen or hacked credit card or payment method into untraceable cash.

Hi,
So the client approved all of it $1000, you received $320 and the rest was reversed?

Hi Danyal,

 

I see that you already have an open ticket regarding your contract. Please allow time for our team to review and update you directly on the same ticket. Thank you!

~ Joanne
Upwork

Yes, I am in contact with the support on that. I wanted to get another idea from Kian Foong L so that I know what compensation was made in his case. Thanks. 

AleksandarD
Community Manager
Community Manager

Hi Kian,

 

I followed up with the team handling your case and you can expect an update on your support ticket in a timely manner.

 

Thank you.

~ Aleksandar
Upwork

This cryptocurrency scam is kind of interesting, because it is different from the more common scams that we see here (fake check).

 

But it really isn't a "new" scam. Ultimately, it is just a variation on offering freelancers money for real untraceable money while sending them fake money. The fake clients could have been asking freelancers to send money via Western Union, or WhatsApp, or gift cards, etc. But money transfer methods often get played out as scammers use them and end up motivating companies to crack down. Cryptocurrency's decentralized nature may make it more resilient to the type of corporate crackdown that has led to some money transfer methods losing favor with scammers (e.g., Western Union).

 

The wisdom and effectiveness of Upwork's policy that prohibits off-platform exchange of funds is certainly manifest within this thread's unfortunate situations in which freelancers were scammed out of real money.

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