CNNdotCOM Tools: Scam protection

From James Hattori
CNNdotCOM Correspondent

(CNN) -- Buyer, beware of scams. Half of all Internet fraud complaints are related to online auctions, according to the Internet Fraud Complaint Center.

Many scams begin when a seller posts a high-ticket item on an auction site and then doesn't accept a credit card payment, said Ed Albro, senior features editor at PC World. The buyer is then asked to send a money order to a post office box instead.

"Once you do that, you'll usually never hear from them again," Albro said.

In other cases, products are grossly misrepresented. A computer touted as the newest and fastest may be a 1986 antique when it shows up on your doorstep.

QUICKVOTE Are online auctions worth the risk? a. Yes. Cautious consumers can get a good deal. b. No. Reputable vendors are worth the extra cost. View Results     ALSO Report results: Online auctions dominate Internet fraud Be E-Wise: How to Shop Safely Online     RESOURCES Online tools for online fools

Albro suggests reading the feedback sections on auction sites, which typically list the seller and all the comments submitted by buyers. Some scam artists have friends and family submit false positive feedback, so most online auctions now require that feedback be from somebody with whom the seller has completed a deal. Negative comments are a sign that you may not want to bid with that seller.

If it's a new seller with no feedback, you're taking a larger risk when buying a big-ticket item. Make sure you get a telephone number that works and a legitimate address -- not just a post office box. You should also have the seller's full name and various means of contacting that person. Many online auction sites now require a credit card number from the seller, to verify identification. Online auctions also try to prevent shilling, or price inflation by owners bidding on their own items.

Another pre-emptive strike is to use an escrow service.

"These are the companies that hold the money while the buyer looks at merchandise and makes sure it's what they wanted. When the buyer approves it, the escrow service sends the money on to the seller," Albro said.

eBay and Amazon.com offer the most buyer protection right now, according to Albro. eBay reimburses you up to $200 if you get ripped off, while at Amazon.com, you can receive up to $2,500 in repayment if you use their payment system.

If you use an auction site that doesn't have an insurance program, and you've been scammed, you can always apply to the auction site for reimbursement. You can also file a complaint with the FBI Internet Fraud Complaint Center.

"The likelihood that the FBI is going to go out and chase the guy down and bring back your money is pretty low," Albro said. "But if you put in a complaint, maybe the guy will get arrested; maybe he won't rip somebody off in the future."

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Yahoo! Auctions
eBay
Amazon.com Auctions
FBI Internet Fraud Complaint Center

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