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Tips for Buying at Auction Web Sites  - Where to turn...

     Internet shopping has become the Internet purchase this year, in comparison with the 13 percent who bought online over the holiday season. One of the key consumer fears about Internet shopping—transmitting credit card information via the Internet is not really a serious problem, experts say, as long as shoppers are careful.
    
Paying by credit card is the safest way to shop on the Internet because many scam artists are not set up to take credit cards and because consumers have the right to dispute dubious billings under the Fair Credit Billing Act," says Susan Grant, vice president of public policy, National Consumers League, Washington, D.C., and director of the Internet Fraud Watch (IFW). "Of the 350 or so complaints we get each week, 98 percent of them involve a situation where the person has paid with a money order, cash or check. Our advice is: use your credit card.
      
Adam Backenroth, president of the Financial Services Technology Consortium (FSTC), a nonprofit group of some 80 banks, credit card companies and vendors that is working to strengthen Internet security, says: "The online consumer is very well protected. At this point, the financial institutions and merchants are absorbing the risks." The problem for online retailers, Backenroth says, is that encryption the standard method for sending secure data provides "an envelope" that assures the sender that the data can't be read by prying eyes, but it does not necessarily assure the merchant that the buyer is who he says he is. That assurance is coming soon, Backenroth says, in the form of digital "signatures" and even "biometrics," such as a digitally readable thumbprint or even the buyer's voice.
     
The bottom line for consumers is that the banking industry cannot afford to have the Internet perceived as unsafe, so individual online financial institutions have assumed virtually all the risks, quietly taken their losses and are working feverishly to build a security infrastructure that will protect them from fraudulent users.

(Source: Newsweek, April 24, 2000 Issue)

Tips for Buying at Auction Web Sites

 Know the seller. Many sites offer a profile of sellers based on comments from other buyers. Be aware that positive comments could be planted by the seller. Get his or her phone number and mailing address (not a P.O. box). If it's a business, contact your local or state consumer protection agency and the Better Business Bureau for more information about it.

For sellers, know the buyer. Check feedback to see if he or she provides payment on time.

Know the product. Try to determine the value of the item before bidding. Read the listing carefully, looking for words such as "refurbished," "close-out," "discontinued" or "off brand," especially when shopping for computer gear or electronic equipment. Be particularly cautious of claims about collectibles.

Ask about delivery, returns, warranties and service.  Settle whether the buyer or seller pays for shipping.

If possible pay by credit card. Credit card users are, protected by a federal law that says they have the right to dispute charges for goods or services they never received, misrepresented items or charges incurred because the card was lost or stolen. Users must report the charge within 60 days of it appearing on their credit card statement and dispute it in writing with their credit card agency. The company will investigate the claim and potentially give the  money he or she lost.

When bidding, do not give out personal information, such as your Social Security, driver's license or bank account numbers.

Document everything related to the transaction. Keep the auction listing, e-mail correspondence, canceled checks, credit card receipts, phone bills and faxes.

Check the auction site's insurance policy.  Most items on eBay, for example, are covered by insurance for up to $200, less the $25 deductible.

Consider escrow services, in which a buyer places money in the custody of a third party. The money is paid to the seller once the buyer receives and approves the merchandise. The buyer typically pays a fee based on a percentage of item's cost.

If you're victim …

Seek dispute resolution. EBay, for example, uses Square Trade, an in dependent third party that provides a trained mediator to resolve disputes. The process takes about a week. The service is free for items on eBay that sell for at least $100.

 Request the seller's user-registration information from the auction site. Attempt to contact the seller by phone or by mail. Send an e-mail to the seller that specifies what you expect and a deadline. Do not attack the seller's character.

Consider using feedback forums. Post negative feedback in seller's file. State only the facts.

Where to turn...

Your local district attorney, state attorney general, the Better Business Bureau  and the auction site.

Federal Trade Commission's Consumer Response Center: 877- FTC-HELP (382-4357); or write Consumer Response Center, Federal Trade Commission, 600 Pennsylvania Ave., NW, Washington, D.C. 20580 or  A complaint form  The FTC can't resolve individual problems but can act against a company if it sees a pattern of possible law violations.

 Internet Fraud Complaint Center, a partnership between the FBI and the National White Collar Crime Center:  The center reviews major complaints and refers them to law enforcement or regulatory agencies. 

 National Consumers League's National Fraud Information Center: 800-876-7060; P.O. Box 65868, Washington, D.C. 20035;. An incident report form is also available on the site.

 If you believe you're the victim of an online fraud scheme in which the U.S. Postal Service was used, (visit the site  to file a mail fraud report. Call 800-275-8777.

Sources: USA TODAY research, eBay, Internet Fraud Complaint Center, National Fraud Information Center, Tessa Herbert and The Online Auction Users Association, Federal Trade Commission

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