Internet auction fraud is a growing epidemic worldwide. There are 51,000 cases of internet fraud cases were reported in 2002. In 2006, that number increased to 97,000. The numbers are staggering, but everyone can lower their risk by knowing what auction fraud is, how to detect and prevent it.
Internet auction fraud cases involve straightforward scams where consumers allegedly win merchandise by being the highest bidder. Everything goes well until consumers send the payment and never receive the merchandise.
In one extreme case in 1999, a man started collecting payments and setting up new auction accounts on a daily basis. In 2001, he started setting up bank accounts and post office boxes under the names of his former victims and collected payments. It isn’t long before authorities question the two people the scammer targeted; only to find out they are dealing with identity theft on top of auction fraud.
In other cases, scammers setup fake escrow services and websites. This way, the scammers can collect merchandise as well as collect payments. The victims never suspect a thing until they have already sent their payment to the fake escrow service or sent their merchandise off to the buyer thinking the payment is safely waiting in escrow.
Prevention of e-auction fraud….
- Become familiar with the auction website. Look into the websites protection policies. and never assume you are protected from auction fraud.
- Before placing a bid, learn as much as you can about the seller. If no information found about sellers, try to 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. If legitimacy cannot be confirmed, don’t use it.
- Never ever give out your social security number, driver’s 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.
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