Kickstarter has finally been discovered by fraudsters. The popular crowd-funding platform for artists and inventors allows anyone with an idea to seek funding from the public, which means scammers are sneaking in to exploit donors with fake products.
Recently, a California-based company called Magnus Fun began a Kickstarter campaign to raise funds for a fake Kobe beef jerky product. With almost 3300 backers and $120,000 in donations, the scammers were poised to walk away with a ton of money until Kickstarter officials shut them down.
How did this fake beef jerky scam even get off the ground to begin with? Let’s take a look at this bizarre case of online fraud.
Kickstarter Pulls the Plug on Scam Just in the Nick of Time
After racking up around 3,300 backers in just a month, the Kickstarter campaign that advertised “Kobe Red 100% Japanese Beer Fed Kobe Beer Jerky” was doing exceptionally well.
In addition to its solid number of backers, the campaign page featured testimonials from real-life people who supposedly just couldn’t get enough of that delicious Kobe Red beef jerky.
Except the delicious Kobe Red beef jerky never existed. The company didn’t have photos of their product, public samples or any other evidence to prove their product was real.
Due to their huge site membership, the people who run Kickstarter rely on the community to police campaigns and report abuse. It’s good, then, that this got noticed when it did, as it was literally just a few days away from ending.
Once a successful campaign closes, the campaigners receive all the money no questions asked. That means the scammers almost got away with it.
The Los Angeles-based Magnus Fun company had its campaign up for a month… but hadn’t posted any information about the company or the people that work for it. (Kickstarter recommends that users do this so that the community feels relatively safe sending money.)
The “Kickstarted” Documentary Crew Saves the Day
Had it not been for the work of some dedicated Kickstarter users and the crew behind a documentary called Kickstarted, it’s likely that Magnus Fun would have gotten away with their diabolically beefy scheme.
The team working on the documentary noticed that something didn’t smell right about the Kobe beef jerky Kickstarter campaign and decided to take a closer look.
Oddly enough, all the reviews of Magnus Fun’s product were screenshots of text messages. Another strange detail was the fact that the only positive comments on the campaign came from users with brand new accounts that had only backed projects which had failed in the past.
CNN Money highlighted some even stranger details, courtesy of the Kickstarted crew:
“In a long post on their own site about their role in exposing the Kobe Red scam, the ‘Kickstarted’ team says they reached out to Magnus Fun with an interview request for the film, and Magnus Fun went back and forth a bit before promising instead to send footage from a recent taste test in California.”
It definitely seems odd, and Kickstarter thought so too. When the website was made aware of the suspicious details surround the Kobe Red beef jerky campaign, they promptly pulled the plug.
Magnus Fun has since deleted their Kickstarter account.
Kickstarter Has Its Risks
What does all this mean for you? Well, first and foremost that it’s important to keep in mind the inherent risks associated with a site like Kickstarter.
A recent study actually showed that 84% of projects funded by Kickstarter don’t get sent out on time. This means that backers don’t get their promised perks when they expect.
Additionally, avoiding fraud on a crowd-funding site like Kickstarter is a bit more difficult than traditional sites. Users have to trust that the creators behind a project are honest about their campaign.
It’s important to use your best discretion and make sure you trust your gut. If something seems suspicious, it probably is.