starkid wrote:
The freelancers get upfront money from the clients and never deliver the work or deliver incomplete/inappropriate work.
To solve this problem, Elance used an escrow system. The client would tentatively pay money to Elance, which held on to the money until the work was done to the client's satisfaction, at which point the escrow money would be released to the contractor. A lengthy project could be divided up into milestones, with the contractor getting paid after each milestone.
The escrow system was a good way to ensure that neither the client nor the contractor got ripped off.
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