Has anyone encountered this before or know the proper way to handle it?

This is a pretty common scam, @Jasmine Pickney. .   

Identity theft and advanced fee scams are big risks.

Is it just me or are others seeing lots of VRBO scams?

It has typically been held to be a major ethics violation with a punishment that includes a hefty fine and an ethics class.Do you all encounter this problem a lot?

I might be wrong, but this sounds like a scam, partially because you found it on Craigslist which is ground zero for scammers.

Their cost of money will be higher.This is a scam, @Nathan R Andersen.

So in 2001, when people are crazy about Internet , there're actually 30% real inventions that change how people live, but 70% are crappy it-seems-line-an-invention-but-it's-not that the whole purpose is just to scam people by introducing new idea.   

Will I just encounter the same issue?

But I've also had a deal (you can search for my post where I tell the story) where it took me 6 years to close a listing due to estate issues and executors dying, short sale scams, etc.