Beware of These Cybersquatting Scams

The Common Types of Cybersquatting Scams

Since 1999, the Anticybersquatting Consumer Protection Act, which is a U.S. Federal law, has defined cybersquatting as the act of trafficking, registering or using a domain name that is purposefully similar to a brand or trademark of a company or person. This is done for the sole purpose of profit.

These individuals may squat for the thrills, simply because they like the particular name or brand, or they may use it for more devious means, such as advertising the products of a competitor, for stalking, fraud or harassment.

Most cybersquatters offer to sell these domains at a high price to the company or individual that owns the trademark. The most malicious cases of cybersquatting involve thieves who use a domain name that is similar to that of a bank or other entity, in order to create a website for the purpose of phishing.

The Common Types of Cybersquatting Scams

The following are the most common types of cybersquatting scams:

Typo Squatting

One type of cybersquatting is known as "typo squatting," and this is a scam where an individual creates a domain name that is almost identical to a brand's website address. Also called "URL hijacking," an example of this is when a brand has a website for their company, i.e. CommunityBank.com. The cybersquatter will take that domain name and register a number of other URLs, such as ComunityBank.com, CommunityBank.org or CommunittyBank.com. All of these are remarkably similar, but different pages.

When an unsuspecting visitor goes to one of these other sites, the outcome could be terrible.

Park and Wait

The "park and wait" scam is another common cybersquatting ruse that some may not consider a scam at all, but more of a business opportunity. This involves buying and registering several domain names, many of which are already ideal for existing companies, and waiting for a company to buy it for a large sum.

Fake Email Scams

In this case, a person receives an email from a registrar company that warns another person is attempting to set up a similar domain name to one that you own. Though the email promises that the company will take back the domain name, they will charge you greatly for this service and the worst part is that there is really no threat.

Domain Name Front Running

Another type of cybersquatting scam is called "domain name front running." This is a tricky scam where a registrar uses information from inside sources. The information is based on the domain name requests of future customers. These domain names are quickly purchased, and then re-sold or used to earn revenue by putting ads on the homepage of the domain.

In this case, the register will block other registrars from selling the domains to other customers. This works by allowing the owner of the domain name to take advantage of a trial period, usually a five day period where other registrars cannot access the name. The registrar does this again and again, essentially blocking others from purchasing it.

Reverse Domain Hijacking

Finally, there is a cybersquatting scam known as reverse domain hijacking. In this case, a scammer will try to take back a domain name that belongs to you by making false claims of cybersquatting, basing it on trademark ownership.

This claim usually intimidates the rightful owner (in this case, you) to transfer their domain name to the owner of the trademark to avoid legal issues.

Cybersquatting will always be an issue, and it makes sense to those who have a brand, or even a name, to claim these domains now. Even those who have children may want to consider buying the domain of their names, too. There are new domain extensions, too, such as dot co, instead of dot com, so keep this in mind as well, and get your domain name before the bad guys do.