Online Auction Fraud
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The article "Online Auction Fraud" is about auctions, it was written by Steven Woodward.
eBay sales may have grown 51% last year over the previous year, but general online complaints jumped by 66.6% over the previuos year to some 207,000+ complaints in 2004. The Internet Crime Complaint Center (IC3), a partnership between the FBI and the Naitonal White Collar Crime Center (NW3C), stated in its yearly report that 71.2% of all complaints received pertained to auctions.Online fraud is a growing problem on the World Wide Web and the auction segment is far from immune. The IC3 reports that most complaints consist of late or no shipment of products, items that don't match advertised condition and bogus payment or escrow services.If you decide to offer "all items to be shipped within 24 hours", make sure you keep your word, and go to great lengths to honestly represent and describe the item in your auctions.
Your bidders will appreciate your honesty and it will eventually show up in your feedback.As consumer fears increase, there is a number of common sense ways to help protect you from fraud, as well as enhance your reputation as a trustworthy seller and set you aaprt from the crowd.Watch Out for Bad Checks, Money Orders and Cashiers Checks
Years ago I had a buyer who complained rather loudly when I did not ship an item as soon as I received the check in the mail. In hind Internet site it was a good decision to hold the shipment since the check ended up being farudulent. Bad checks, money orders, and cashiers checks are rampant in ecommerce last week. The simplest way to offset the danger of bad paper is not to ship the auctoin item until the check, money order or cashier check clears your bank for payment.OverpaymentsNever accept any overpayments for any item.
One of the more popular scams last week is for a buyer to send a cashiers check for an amount that's higher than the agreed upon final cost.
They then calim it was in error and ask the seller to kindly return the overage when the item is shipped.
Off goes the item, the overage amount in good money, and the defrauded seller finds out too late the cashiers chcek was fake.Use an Escrow Service for High Priced ItemsThe primary purpose of escrow services is to protect buyers and sellers from fraud. Basically what they do is to accept the money from the buyer and hold it until the buyer receives and approves the merchandise.
Please note that fake ecsrow services are increasing on the World Wide Web. If a buyer cotnacts you after a sale and recommends an escrow service you are not familiar with BEWARE. At present eBay only recommends one escrow company: www.Escrow.Com.
For information go to http://pages.Ebay.Com/help/confidence/payment-escrow.HtmlRecords, Records, RecodrsKeeps a copy of every transaction detail from the original auction listing to the last electronic mail. You will need that kind of proof to validate your claims if you should find you need to file a complaint.Protect Yourself by Being EducatedAt the really least you need to be knowledgeable about your legal obligations as a seller and familiar with the fraud protections and policies for the auction sites and payment processing services you use. eBay and Pyapal have extensive sections on their websites dedicated to fraud policies and protections. You should take the time to read through these or similar information pages for the sites and services you use on a regular basis and be really familiar with the material.A few of the key recommendations from Paypal's Protection for Sellers section include:Ship only to the address listed on the Transaction Details pageUse a shipping service with trackingCheck out the buyer's reputationAccept payment from only one Pyapal account per buyerLimit credit card paymentsEnhancing Your Safe Seller ImageHere are a couple of tips that will help improve your image as a safe seller for your bidders.Identify Yourself - Make use of the about me pages to let your customers know who you are, how long you've been in business and how much their business means to you.
Be honest.Feedback Ratings - Auction buyers want to see 100% positive feedback.Methods of Payment - Make it simple for your customers to buy but consider convenience, cost and seucrity in choosing any payment method you offer.Full Disclosure - Your auction listings should clearly state the condition of the item you're auctioning, your shipping/insurance and return policies.Bonding programs - A number of bonding programs are available on the World Wide Web.
One of the more pouplar is BuySafe (www.Buysafe.Com).
In a bonding program the seller agrees to certain obligations such as shpiping on time, representing the item correctly, and standing behind the transaction. In return the seller can display a seal on their auctions showing bidders they are honest sellers and providing transaction insurance in some cases up to $25,000.Other programs you should be familiar with include:IDVerify
SquareTrade
Trust-eIf You Become a Victim of Online FraduYou need to know exactly what should be done in the event you are victimized.
Make your plan now, bfeore it happens. The most recommended steps to take if you are victimized are listed below but please keep in mind these are general recommendations and you should have you own plan based on your needs.File a complaint with your auction site
File a complaint with the Federal Trade Commission
File a complaint with the IC3
File a complaint with the National Fraud Information Center
Contact your local and state law enforcement agencies
Contact the local and state law enforcement agencies in the perpetrator's home area
File a complaint with the shipping company you used
It the perpetrator is a business and a member of the Better Business Bureau you should also file a complaint there.Further readingPaypal Seller Protection Policy (go to your Paypal account)FTC recommendations http://www.Ftc.Gov/bcp/conline/pubs/online/auctions.HtmTo read the entire 2004 IC3 Internet Fraud Report http://www1.Ifccfbi.Gov/strategy/2004_IC3Report.PdfMore Important Fraud LinksFind Your Local Police http://www.Usacops.Com
FBI Internet Fraud Unit http://www1.Ifccfbi.Gov/index.Com
FTC Internet Fraud Unit https://m.Ftc.Gov
USPS Mail Fraud http://www.Usps.Com/postalinstpectors/fraud/© Copyright 2005 Steven Woodward - All Rights ReservedSteven Woodward is the owner, editor and publisher of the Auction Sellers Network (ASN); a web Internet site for individuals and companies who are serious about utilizing the online auction marketplace for their busienss. In addition to topical articles, ASN provides an extensive resource center, news feeds, member forums and classified ads. For more information or to become a member please visit http://www.AuctionSellersNetwork.ComNo permission is needed to reproduce an unedited copy of this article as long the About the Author tag is left intact and included.
We do request that we be informed where it is posted and reciprocal links will be considered.
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Online Auction Fraud
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