Same problem; they get the CC company to issue a chargeback, and you're out the money. Scammers love Ipods and Playstations, 'cause they can easily sell them on. Be wary of your buyers, especially Nigerians / Romanians / Any one offering an unusual method of payment.
Offer it for sale locally on a message board (online or offline), if you have the population density. Get the cash when they turn up. If they do.
Tell your customer to post the item back, then issue a refund.
Even cheques can be dodgy; wait at least a week after the money's in your account; banks take a while to cancel dud cheques, and then they'll take the money back from you.
PS: The fact that he offered more than the normal second-hand price was a red flag; he never meant to pay you, so he was being 'generous'. Look at 'completed listings' to see the true value of any item.
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