yourself in online auctions
are an e-commerce phenomenon. But watch your back when you log on to sell and
Tyler Sullivan has experienced a good auction deal gone bad.
"At the time, I was clueless," says the 18-year-old student from Green Bay, Wis.
"I had no warning."
Sullivan sent $115 by money order to an
online seller, and waited, and waited ... and waited. Unfortunately, the seller
had duped him. "I was just left wondering," he says.
Sullivan found I-Escrow, now called Tradenable.com.
For a small fee that is based on the cost of the items, Tradenable.com acts as
a go between for buyers and sellers.
an item online, buyers send their money (usually a check) to Tradenable.com rather
than the seller. When the check clears, Tradenable.com tells the seller to send
the item to the buyer. If it meets the buyer's satisfaction, the escrow service
sends the payment to the seller.
"We offer real protection
for sellers as well as buyers," says Johnny Wong, a spokesman for Tradenable.com,
in Redwood, Calif. Wong suggests sellers state that they will only deal through
an escrow service, and bidders request use of the service when they place their
Auction fraud is unusual but worth your attention. On
any given day, there are 6.5 million items for sale on eBay, the Internet's
best-known auction house, based in San Jose, Calif., and another 1 million new
items are added daily. Sales per day are approximately $26 million. eBay's rate
of fraud rate remains below .01 percent.
eBay's security begins
with the initial registration. Setting up an account requires supplying a name,
this information will not be shared with other sites or dealers.
in good standing
For any transaction on sites including
Auctions and Amazon.com Auctions,
you should exercise caution. Kevin Pursglove, a spokesman for eBay offers three
simple steps that can help keep you safe on eBay.
a few minutes to read the user agreement. Become familiar with the rules and regulations
as a bidder and a seller.
- Check in eBay's Safe
Harbor area to learn about all of the avenues available to you as a buyer
or seller. eBay will insure transactions through Lloyd's of London.
forum. Read the ratings and comments that other users have left about the
member you're dealing with before you make the bid. e-mail the person with any
questions to make sure you're perfectly clear with all of the aspects of the trade.
yourself, and use an educated and informed approach when dealing with online auctions,"
says Pursglove, adding that escrow services offer another layer of protection.
you play it safe, you can buy and sell without being sorry. Scot Wingo, CEO of
an online auction shopbot based in Research Triangle, N.C., has completed 50 to
100 successful online auction transactions.
"It's a great way
to find things to support a hobby, and some people have even made it a full-time
job," Wingo says.
Wingo has his own tips for auction protection:
- Never buy from a dealer who has less than
10 good sales in their feedback rating.
- Be specific
about what you will accept from a buyer when you place your item up for bid. For
example, require that the bidders have a certain feedback rating to bid on your
item. If a bidder doesn't meet your criteria, sell the item to the next highest
- Personal security issues are a factor
in online auctions. When you send a personal check with your address, phone number
and checking account number on it, there's a concern for safety.
heard of sellers showing up at buyer's houses with the merchandise if they live
in the same town," Wingo says.
Even if you follow all precautions,
there's still a small chance of problems. But eBay and other online auction houses
are doing what they can to keep these troubled transactions at bay.
implemented programs to boost confidence and trust," says Pursglove. "We've hired
a formal federal prosecutor and members of law enforcement to stop anyone from
violating the user agreement, reducing the number of fraudulent transactions,
and apprehending violators."
If you have a bad transaction,
you can file a complaint though eBay, and the complaint is immediately sent to
the Federal Trade Commission
"We're working hand in hand with the FTC to
develop ideas for safe trading," Pursglove says.
"The majority of the people out there have good purposes with their trades. But
for every 100 good transactions, there's a risk for one bad one."
auction safety checklist:
- Before you act, find
out what your options are if the deal goes bad
- Read an auction
site's user agreement for rules
- Check a buyer or seller's
- Beware of compromising your personal security
an online service that acts as a financial go-between