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01|03|2009 02:37 pm EDT

Domain Name Scam Warning : Pumping and Dumping Domains

by Adam Strong in Categories: Featured

Pump my dollarIn a fashion reminiscent of investment pump and dump scams, domain sellers list domain names for sale and pump cheap traffic to the names to make them look appealing and then dump the names on unsuspecting buyers.  These scammers list domains for sale on domain aftermarkets that advertise the inflated traffic information and dump the domains off on a buyer who is likely unaware that the traffic is temporary. This is not a new scam, but it appears that we have some damning evidence of scammers in action on TDNAM.com.

To be clear though, we are not pointing to TDNAM as a perpetrator with any involvement, rather they are merely the venue where  scammers are preying on unsuspecting victims. The sellers in a pump and dump are the scammers not the venues.  We are sure this happens at more than just TDNAM and don’t mean this article to suggest otherwise.  The links we were given show what is easily perceived as sellers engaged in “pumping and dumping” domain names being sold on TDNAM.  Anyone buying any domain names in the aftermarket on the basis of traffic numbers should be aware of this scam.

This activity can also occur outside of an aftermarket venue.  When selling a domain name in public, say on a forum, it’s common for sellers to receive requests from savvy domain investors to “test the traffic”.  The request is made in order to validate any claimed traffic.  It’s the domainer equivalent to due diligence.  Most sellers in this arena are also familiar with the practice.  Sellers know that they won’t be able to sell a domain that they pump with bogus traffic and not be caught.  The risk of being exposed on a public forum as a fraud are likely strong enough that this doesn’t occur very often.   Since whois records can be changed and new identities created easily, it is still possible to run this scam outside of the confines of an aftermarket platform.

An aftermarket platform, however, often provides even more unsuspecting buyers for the scammers to prey on and their terms give the sellers a shield to hide behind. TDNAM, like Sedo.com and other domain aftermarket venues, display domain traffic numbers in the auction details.  The problem with this information is that it is a fairly vague number and only the venues themselves know the details.  The source and  quality of this traffic is not reported and typically not guaranteed.  The TDNAM legal terms only mention this about traffic :

Some Expired Domain listings may include traffic data labeled as “Unique Visitors” (the “Traffic Data”). The Traffic Data is provided AS IS and for informational purposes only. The Traffic Data reflects internally calculated data and does not represent a guarantee of continued traffic in any way.

I was unable to find a terms of service disclaimer on Sedo, but I’m sure that the numbers they post are also not guaranteed.  Obviously, not guaranteeing traffic provides an “out” or protection that sellers can hide behind as they pump in as much traffic to a domain name.  When the domain is sold and the unsuspecting buyer realizes that there is no traffic coming to the domain, the venue and seller can simply reply “We don’t guarantee the traffic”.  This lack of any guarantees enables the pump and dump domain scam.

This is one of the reasons most savvy domainers who buy on aftermarket auctions follow the rule of caveat emptor (buyer beware), knowing full well that the numbers can’t  be relied upon.  What happens to the novice unsuspecting domain buyer ?  TDNAM, being  run by the largest domain registrar, likely has a customer base that is not primarily made up of savvy domainers and likely is unaware of these sorts of scams. To an unsuspecting buyer or novice, a domain with a reported high amount of traffic may seem very appealing.  There are likely far more unsuspecting buyers on these aftermarket sites which enables the scammer even more.

Need Some Evidence ?

So how do we know this is happening ?   Here’s two example domain names that are for sale on TDNAM as of this writing (Friday at 3 am cst) that seem to be “pumping and dumping” (see screen shot below).   Both names have sold in the process of writing this story. The  TDNAM numbers shows 1723 for the domain VideoGameSupermart.com and the domain Dvdroms.net reports 39097.

godaddybloating

It’s interesting to note that the domains mentioned above are not expired domain names. The only mention of traffic in the terms of service on TDNAM that I could find (see above) talks about expired domain traffic not being guaranteed. Does that mean that they are guaranteeing the traffic numbers non-expired names listed on TDNAM?   I doubt these are guaranteed numbers and I’m guessing this omission in the TOS disclaimer will be fixed very soon. There’s a note on the auction page next to the traffic numbers that says “The traffic data is provided AS IS and for informational purposes only. The traffic data reflects internally calculated data and does not represent a guarantee of continued traffic in any way.”

Let’s look closer at Dvdroms.net though. The traffic numbers claim it is getting over 1000 uniques per day. That seems to be a stretch, but maybe it’s not. Where could this traffic be coming from ?   A former website with incoming links ?  Not likely based on a Google link check. Type-ins ?  I highly doubt it.  How about just buying up traffic before you put the domain on auction ?  Enter the company UGGIcorp.com, a company that sells traffic on the cheap.

Setting up and getting Traffic is fast and simple. We charge $2.000 per 3000 Unique Visit. We will review your website and will have it active within 1-12 hours. Make Sure Your site follows our terms. These Traffic Packages are not adsense safe unless it says so on the package.

UGGIcorp has a page on their website that displays how much traffic they’ve sent to various clients during the month (screen shot below in case it goes away).  It turns out that both Dvdroms.net and VideoGameSupermart.com appear on the list of domains that received this “pumping” of traffic in December.

inflatednumbers

SOLD !

Dvdroms.net ended up selling for $265 on TDNAM (sorry link not available).  If the seller bought 50k uniques worth of traffic, as the UggiCorp site seems to be saying, he likely paid around $30.  Add in the $10 paid for the domain, and you’ve got a nice profit of $225.  Videogamesupermarket.com was sent around $2 worth of traffic and sold for $69 .

Ok, so big deal. It’s only 2 domain names, right.  Wrong.
First, these aren’t the only names selling on TDNAM that appear on the UGGIcorp list. The same seller appears to be doing this with multiple domain names listed on TDNAM.  Secondly, these are only the ones we found that had some sort of evidence linking the bought traffic to domain names offered for sale.  Like cockroaches, once you’ve seen one scammer, rest assured there’s more hiding out somewhere.  I’m sure there are other sellers doing this same thing, but with a little more stealth. If not now, I’m sure after this post, the practice of pumping traffic to domains will be done with more discretion in the future.

To top off the story, the whois for the domain names that we mentioned seem to contain bogus information.  Another thing someone pointed out when we discussed this issue is that these domains all go to a Godaddy parking page.  Most PPC companies and search engines frown on traffic that is bought and pumped in to a landing page.  Do you think that the advertisers on that landing page want to pay for this sort of traffic ?  It’s a violation of terms to have bogus whois info and it’s a pretty safe bet that pumping in traffic to a lander is also a terms of service violation somewhere.

Buying domains on the aftermarket comes with risks.  Most savvy domainers know about this scam (possibly having been burnt by it before), but others might not.  Buyers need to be aware of these type of scams.  This example seems to be a clear case of “pump and dump” domain selling.   Hopefully, in the future something can be done on these aftermarket platforms to combat these scams.

Thanks to our friends at DomainAuctionCleaner.com for alerting us to this.

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37 Comments

David J Castello

January 3, 2009 @ 3:22 pm EDT

Great work, Adam.
On the other hand, domainers have to use their heads. I wouldn’t buy undeveloped names like dvdroms.net or tatuaze.info for $5 no matter how much traffic someone claimed it received.

Reece Berg

January 3, 2009 @ 3:26 pm EDT

I would never buy a high traffic domain without first either testing it out myself (nameservers change by owner to accommodate me) or seeing server logs, complete with referral urls. Due diligence absolutely is a must — plenty of resources like Archive.org + WT/KD to better estimate traffic. I’ve seen a lot of questionable domains with high traffic offered on domain forums lately as well.. Best to stay away if you can’t determine where it’s coming from imho.

Francois

January 3, 2009 @ 3:39 pm EDT

Open a parked page into a popunder and you start to generate false traffic.
What is vicious is this traffic will have no referer so it will be assimilated as type-in, bookmarks by the traffic logs, in other words traffic of high quality for domains.
And unfortunately there is ABSOLUTELY NO WAYS to control if the traffic is fake or no. So if the scammer just inflate the traffic enough to make the domain appealing and you only base your bid on this you are dead.
This is why it’s good to allways check domain metrics (term frequency, search popularity, …) and see if the traffic make sense.

Andrew

January 3, 2009 @ 3:40 pm EDT

Nice work, Adam. I wonder if people trust the TDNAM numbers b/c they’re under the impression that traffic numbers are only shown on expired domains?

Adam Strong

January 3, 2009 @ 3:59 pm EDT

@David,Reece,Francois,Andrew – thanks for the comments. Of course everyone should use their head, checking sources for metrics, and caveat emptor always rules. There’s a lot of “non-domainers” that read these posts and don’t necessarily know better. Really who knows how many have been suckered by the alluring false traffic counts. As someone in another forum pointed out to me, if the numbers aren’t verifiable and not backed, why even post them. It’s clear seems very clear why in my mind.

Adam Strong

January 3, 2009 @ 4:01 pm EDT

@andrew – good question btw with the traffic numbers now showing on 3rd party domains for sale that confusion can easily be made. Maybe tdnam needs to differentiate expired domains from 3rd party in a graphical manner ?

Reece Berg

January 3, 2009 @ 4:24 pm EDT

@ Adam: Yes, I’m sure this will help lots of people. People wouldn’t be doing this unless they’re making a profit doing it, so they’re clearly finding people to sell them to, as your examples above illustrate.

[…] Domain Name Scam Warning : Pumping and Dumping Domains […]

Steve Kaziyev

January 3, 2009 @ 5:23 pm EDT

Great post Adam,

I’ve been burned myself in the past and now i see how its done. Disgusting, and the names that i’ve purchased with traffic(fake) were all purchased from tdnam. now i know why the name had 5000 visiotrs and 3 weeks later had none. great post. i’m sure to use be more careful on my next purcahse at tdnam, if any at all.

@ Reece Berg – i know of archive.org but what is WT/KD?

Once again great post Adam

Happy new year.

tim davids

January 3, 2009 @ 6:38 pm EDT

what is “informational purposes”?
to me a number is represented as a fact and the platform owner should be responsible for its acuracy because it is a for profit business.

Good reporting btw

tim davids

January 3, 2009 @ 6:40 pm EDT

After thought: maybe it should read “entertainment purposes” :)

domain name

January 3, 2009 @ 6:43 pm EDT

I found your site on technorati and read a few of your other posts. Keep up the good work. Looking forward to reading more from you. Cheers, AJ.

ASEAN Central

January 3, 2009 @ 10:32 pm EDT

@Steve Kaziyev: I believe WT/KD means WordTracker.com or KeywordDiscovery.com.
These are sites are approximator of keyword popularity.

Steve Kaziyev

January 4, 2009 @ 12:30 am EDT

@ Asean – Thanks

ligtv izle

January 4, 2009 @ 6:50 am EDT

Nice work, Adam. I wonder if people trust the TDNAM numbers b/c they’re under the impression that traffic numbers are only shown on expired domains?

TurkDN.com

January 4, 2009 @ 8:39 am EDT

Great post, one of the best that I have read during last few weeks to be honest. I was so close to be burnt by one of those fake trafficked domains. It was almost in the last minute I figured out how the traffic is so high. It happened earlier in 2008 and I kept warning my other domainer fellows. But never had a chance to write anything about it.

Thanks for the warning, it is amazing in how many different ways people are trying to trick others. This just hurts the industry as a whole.

[…] Strong from Domain Name News wrote a great post about traffic domains and what you should watch out for. If you’ve been […]

[…] Domain Name Scam Warning : Pumping and Dumping Domains […]

ParkingFirm.com

January 4, 2009 @ 10:56 am EDT

interesting find Adam, we will have to be little more alert while buying domains/websites wit high traffic :-)

Thanks to you again Adam.. cheers!


Jay M
ParkingFirm.com

Johnny B

January 4, 2009 @ 12:38 pm EDT

Kudos! A great article and investigative reporting Adam.

I apologize if this is a tangent, but can anyone recommend a reputable place to purchase legitimate unique traffic? And no, NOT for domain pumping.

I want to increase traffic to some sites and I am hoping there is something less expensive than pay-pay-pay-per-click.

Ron

January 4, 2009 @ 1:25 pm EDT

Excellent article. The traffic figures have always been misleading in my opinion. First of all there are several different forms of traffic as illustrated in the appraise video on this page:

http://www.webtrafficconsultants.com/vancouver-search-engine-optimization-videos.htm

Another important issue in buying and selling domain names that hasn’t been big because we are still in the infantcy of domaining is domain destruction. Like purchasing a house you can buy a domain name that is completely destroyed. For example, the email has been used for spam or the domain name has been used or tied to damaging activity and it is published on the internet.

I have on two occasions seen domain names in these categories which further stats my case that domain auctions and the way people approach domaining will evolve in the future.

Joe Bloniarz

January 4, 2009 @ 1:27 pm EDT

When domainers are scamming each other, it’s no wonder that general users are suspicious of us. Those of us that have been in this business for awhile will often get an unsolicited offer for one of our better “type-in” domains, and when explaining to the “general public”, about the many attributes that makes a particular domain valuable I find they often dismiss the traffic numbers, its truly no wonder that they do as you can purchase crappy traffic for cheap.

Remember back in I believe late 2007, when people would place PPC adds on yahoo.com and have the traffic directed to their parking provider that would use a google feed? It seems the idea of artificially inflating traffic just never seems to die!

Ron

January 4, 2009 @ 1:34 pm EDT

By the way as I mentioned in my post above. What are all of the different forms of traffic?

Direct Type in Traffic
1) Guess Type in Traffic (Usually long lasting. I guess that there will be something there so I type it in. i.e. NewYorkPlumber.com)
2) Brand Type in Traffic (Associated with a current or previous brand)
3) Link Traffic (Links on sites and search engines that have built up which will vanish over time unless there is a site that reflects the links)

If the name in question had all of its traffic coming from #3 above would we look at this as a pump and dump? Obviously having all of the traffic from #1 above would show a very valuable domain name but looking at the domain name being a .net and very poor I think we all can conclude that it isn’t getting the traffic from this source.

Chris Nielsen

January 4, 2009 @ 2:59 pm EDT

Old story, but need to be told again and again so it’s not forgotten, and NICE investigative work to find the source of at least some of the traffic. Great work! :-)

Les

January 4, 2009 @ 3:02 pm EDT

Don’t buy any domain based on traffic. Built into a quality site…the traffic will come. TDNAM and SEDO both sell pump and dump domains…I’ve been burned on both sites!

web2.0domain

January 4, 2009 @ 5:28 pm EDT

Good post, I saw someone get busted trying this scam on the Digital Point forums just last month. As far as I’vd noticed those TDNAM traffic estimates are fairly useless even if people aren’t scamming so I never trust those. I rather search for existing links or use my head to determine if it is the type of name that would attract type in traffic.

Dave at Marketing Forums

January 5, 2009 @ 3:18 am EDT

I had long suspected that this practice was in use, i tend to look at the domains as only having worth if the name is of any use to me, and the price is right (ie not highly inflated!!)

Even if there is traffic, it has to be related to something you are wanting to do to be worth something, and it won’t last forever unless the backlinks are still there.

Stephen Douglas

January 5, 2009 @ 4:05 am EDT

Again, my cousin Adam comes up with an amazing piece of investigative journalism for the domain industry. This is a very important piece of info for all domainers, especially the beginners.

However, the overall effect has been moot, if you take into account all the other domain value factors that most pro domainers know. First, never buy a domain based on traffic stats, ESPECIALLY nowadays.

Second of all, TDNAM? Good grief. Although I have connections with Godaddy, I’m totally disappointed with the way their system manipulates the noobies, all across the board. That said, you can find some good deals there, just be smart and careful.

Thirdly, the sale prices of the two domains mentioned, “dvdroms.net” and “videosupermart.com” were cheap, and they aren’t bad domains, regardless of the traffic. (This doesn’t make what these “pump and dump sellers” legit) What’s ironic here is that the “traffic” pump that was posted didn’t push these domain values up. Maybe the buyers were pro domainers who ignored this obvious “promotional party favor”. I expect this to be true.

NOTE: It’s like the little fish asking his dad which worm not to bite, and his dad replies “Avoid the ones that say ‘Made in Taiwan’ on its butt.”

The same thing applies with buying any domains. Do your dang homework, people! The domain has to make common sense. It has to have some niche value. You have to anticipate how your domain purchase will play out as an investment:

1) Are you going to park it for PPC rev? (this is where common sense and deep research need to be applied)
2) Build it out and sell CPA or your own prodserv? (find a good inexpensive domain development company)
3) Or are you going to sit on it and wait for an end user resale?

In all cases, the domain should be short, memorable, and have a resellable prodserv. The techniques to finding how to do this is up to your own research and education. A quick way is hiring Adam (domainconsultant.com) or someone you trust as a consultant to help you figure this out. The dollars spent on having a pro domain consultant assist you with your domain purchases is ultimately more valuable for your ROI than going it alone, and arrrgggghhh, heaven forbid, you going on a “domain name buying spree cuz you caught the fever” on an idea that just won’t work.

A final word on TDNAM… oops… can’t speak my mind folks. I’m corporate now. They are sweeties. However, that Danica Patrick is a danger. Just got her second ticket in a year. Going 54 mph in a 35mph zone. Tsk tsk. Endorsement value dropping…

Great article, cuz.

Stephen Douglas

Furkat

January 5, 2009 @ 4:52 pm EDT

Adam, a great job, I should have read this article before I bought one of my domain names on SEDO.COM Auction.

I have lost some money on one of the domain names I bought on SEDO.COM auction by using PayPal.com .

I have appealed several times to SEDO.COM and PAYPAL.COM, neither of them responded to my appeals.

Guys be careful, I am glad that ADAM has responded to such calls and glad that Google has taken over the domain parking business from SEDO and Others. It is going to be more transparent and cleaner from those bustards out there.

Stephen Douglas

January 6, 2009 @ 7:17 am EDT

*Furkat* Did you just say that Google domain parking “is going to be more transparent and cleaner from those bustards out there”?

When I start eating green chicken and poop purple sherbet, you can expect “transparency” from Google.
Why don’t you tell a detailed story of your experience of losing money from a domain you bought at Sedo and using Paypal? What happened? Fill us in…

Free Reg Names

January 6, 2009 @ 10:14 am EDT

Stephen, I’m positive Google will eventually become transparent.

However, you and I might not live long enough to see it.

keith

January 6, 2009 @ 12:00 pm EDT

Just had 10-reg.com tell me some one was trying to buy domains similar to mine and wanted to know if we wanted them before the other person bought them.
went to whois and found out they were in bussiness for 2 months and had no history on the internet.

Steve M

January 6, 2009 @ 5:46 pm EDT

Great investigative work, Adam.

Thanks.

Wikan

January 7, 2009 @ 12:14 am EDT

So, what is the good guidance for buying good aftermarket domain?

Karan Goyal

January 8, 2009 @ 12:20 am EDT

Very nice digging work, awesome find.

UFO.ORG

January 12, 2009 @ 6:07 am EDT

There’s a well known site that sells websites that appears to suffer from the same problem(s).

This is actually a complicated industry; people really do need to learn the trade before throwing themselves headlong into it. I would guess that every domainer (not matter how successful) can raise their hand to wasting money on dross while they have learned about it all.

[…] the perpetrators were trying to pump-and-dump on GoDaddy Auctions. GoDaddy Auctions shows traffic numbers next to domain names listed for sale that are also parked […]

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