Is this a scam?

Wow… as mentioned previously, the only solution is run. Period. Refund the deposit, be done. You don’t even need to say why. Just do it. 

Actually if one were to think on this idea of a scam or being ripped off or being susceptible to propaganda or psychological operations campaign(s) directed at a target audience we have to accept we all are fooled to different degrees. It is up to each of us to figure this out. Even something as simple as advertisement. How often have you watched or listened to a commercial for a product or service that offered something much better than you got? That's what advertising is intended to do.

Reverse scam him, keep the money and tell him to F off.

If anyone says you ship first and only after shipping confirmation (or pick up) then you get paid balance amount- that is a red flag. I have paid deposits or partial payment initially to secure the sale- that is ok but any mention of shipping before payment is a scammer at work. Shipping should be after you receive payment or at time of pick up (local transaction).

Until you have the funds irrevocably in hand, never release your goods. But if you have a "bad feeling" about a transaction, back away form it.

That said, I've sold to buyers who use freight forwarders with no issue. Their use generally implies the goods are headed overseas. The forwarder completes all the export docs, occasionally the import docs as well, and arranges shipping. Freight forwarders get paid to provide this service. Having exported equipment, I'd rather pay someone to take care of all this.

Worth repeating: until you have the funds irrevocably in hand, never release your goods.

Is this a scam?  YES

I think Barjohn has the best suggestions above for protection.

From the original post I am not sure why everyone thinks its a scam.  The guy sent money via pay pal why is that suspicious ?  I have been using Pay Pal for years .  Sending it through friends and family saves the commission but the buyer loses protection which is the only thing thats strange.  I wouldnt say for sure its scam. I also wouldnt say for sure its a stolen CC on pay pal as I am not sure its that easy.  That being said I wouldnt send my expensive gear out with only a down payment .  Do the full transaction through Pay Pal and you have protection but get the whole thing paid.  He too as the buyer has protection by paying all through paypal

Freight forwarder means nothing if the guy is abroad.  Not sure why that is a red flag to some.   I have done millions of dollars through freight forwarding companies in my lifetime in technology.  If the guy is not abroad no forwarder would be needed.  

Get paid one way or the other in full before releasing any product

What they all said. report him to Pay Pal too!

Call the bank that issued the card that you received the payment from and inquire if it is a stolen card. Try calling your bank to get the issuing bank's phone number, or ask them if they can advise you how to obtain the number. 

As note by dgluke, it is possible for funds to settle from a stolen card and be reversed at a later date. You want as much information as you can possibly get.

My policy is to never do a friends and family PayPal transaction with anyone I don’t personally know and when using PayPal will ship only to a PayPal verified address.

Best advise is do nothing. If a stolen card, the transaction will be reversed and the scammer, most likely, moved on. Then report suspected fraud to PayPal and USAM. If contacted by the supposed buyer, explain the payment was reversed (bank verified) and that you decided that you will only do a legitimate PayPal sale transaction, shipped to a PayPal verified address.

Jim