Prevention of E-auction Fraud for Consumer

E-auction is a market mechanism by which buyers make bids and sellers place offers; characterized by the competitive and dynamic nature by which the final price is reached which conducted online.

But beware, there are several types of E-auction fraud such as:

• Bid shielding (Having phantom bidders bid at a very high price when an auction begins; they pull out at the last minute, and the real bidder who bid a much lower price wins)
• Shilling (Placing fake bids on auction items to artificially jack up the bidding price)
• Fake photos and misleading descriptions
• Improper grading techniques
• Bid siphoning
• Selling reproductions as originals
• Failure to pay
• Failure to pay the auction house
• High shipping costs and handling fees
• Failure to ship merchandise
• Loss and damage claims
• Fake escrow services
• Switch and return

Ways to prevent E-auction fraud:

• Authentication service-it is a service to determine whether an item is genuine and described in proper manner.

• Grading services-a service that determines the physical of the product whether is in a good manner

• Feedback forum- this is a forum that provides users to express out their experience dealing with e-auction.

• Insurance policy- there is some insurance policy that provide to customers or users like the insurance policy by Ebays with no cost at all.

• Escrow services- Both buyers and sellers in a deal are protected with an independent third party. Buyers mail the payment to escrow services which verifies the payment and alerts the sellers when everything checks out. Eg: i-escrow

• Physical inspection- eliminates many problems especially for collector’s item. When the seller and buyers are in the same vicinity, it is easy to arrange for such inspection.

• Item verification- is a way of confirm the identity and evaluate the condition of an item. Third parties will evaluate and identify an item through a variety of means.

• Become familiar with the auction website. Look into the websites protection policies. Never assume you are protected from auction fraud.

• Before placing a bid, learn as much as you can about the seller. If you can’t find anything out about the seller, than avoid doing business with them. Never fall for promises of better deals by moving away from the original auction website.

• If the seller wants you to use an escrow service you’ve never heard of, look into it. Check out the website. Call up customer support. Contact crimcheck.com to dig up data on the business in question. If you can’t confirm the legitimacy, don’t use it.

• Never ever give out your social security number, driving license number, credit card number, or bank account information until you have thoroughly checked out the seller and the escrow service.

• Always save 100% of the transaction information. You’ll be glad you did in the event your case makes it to court.

• If after the sale you feel the item/payment should have been delivered already, try to work it out with the seller/buyer. If at that point you feel that fraud is involved, immediately contact your state attorney general’s office and the FTC at www.ftc.gov or call toll-free 1-877-FTC-HELP (1-877-382-4357).