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Web commerce mostly safe, but stay wary

You explored Amazon and dived into eBay, but you left empty-handed. While browsing on the Web, you shut the Barnes & Noble door behind you without letting your credit-card numbers escape.

You don't have a problem with handing your credit card to a waiter who whisks away your precious plastic for a few minutes. When you call a mail-order catalog company, you cheerfully give your credit-card information. But buying stuff on the Web with a credit card? Isn't that dangerous?

"It's much safer to put your credit card on the Internet with a secure server than giving your card to a waiter in a restaurant or calling someone and giving them your credit card over the phone," says Paul Capelli, a spokesman for Amazon.com.

Steps to reducing risks
Just as you would hesitate to hand your card to a fellow selling sunglasses on the sidewalk, you should steer clear of questionable retailers on the World Wide Web. You can reduce your risk of unpleasant surprises while shopping on the Web by employing common sense:

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  • Know whom you are dealing with.
  • Insist on secure transactions.
  • Pay attention to terms and conditions.
  • Check what other people say about the company.

According to a 2001 shopping online survey conducted by the National Consumers League, 43 percent of web surfers say that their biggest fear is that their credit card numbers will be stolen.

Learn about the online retailer
First, ask how you heard about the site, counsels Walter Effross, an associate professor of law at American University's Washington School of Law. "Did you see an ad in The New York Times or a respectable magazine -- or a spam e-mail?" he asks rhetorically.

You can feel pretty confident with nationally known brands that advertise on television, in newspapers and magazines, and on Web banners. At the same time, a little storefront on the Web might be just as trustworthy and efficient as the big boys.

Let's say your hobby is candle-making and you want to buy supplies online. You could visit Missy's Candles, a company that is not a household name but which offers secure online ordering as certified by VeriSign and belongs to BBBOnLine, an online business ethics program of the Better Business Bureau.

No matter how secure and forthcoming a business seems on the Web, you still might want to check to make sure that the Web site really is owned by the company that you think is the owner.

The most reliable indicator is a search engine called Whois. Run by Versign Inc., the company that assigns Web addresses, Whois allows you to find out who owns a domain name, the part of a Web address that ends in .com, .edu, .org, .mil and so on. It provides contact phone numbers and e-mail addresses.

A well-designed commercial Web site isn't going to make you go to Whois to find out where it is based and how to contact people there. Take the site for Missy's Candles, mentioned above. The company's toll-free number, a fax number and a technical support number are listed at the top and bottom of the home page. The street address and an e-mail link are at the bottom of the page, too.

Another item to look for is a privacy policy, in which the company explains what it will do with information it gathers about you. Will it sell or rent your name, mailing address and e-mail address to other companies? Will it track what you buy so it can tailor sales pitches to your tastes? A site that has a "trustmark" from an organization called TRUSTe has promised to adhere to established privacy principles and comply with TRUSTe's oversight and consumer resolution procedures.

Insist on secure transactions
The good news is that it is pretty safe to use a credit card on the Web if you are buying from a reputable seller. The bad news is that it's not absolutely safe. It is possible, though unlikely, for a hacker or a dishonest employee to steal your credit card number over the Internet.

Here are some tips for protecting yourself:

  • Enter credit-card information on secure server pages only.
  • Choose good passwords and don't reveal them to anyone.
  • Use credit cards instead of debit cards.
  • Confirm whether your order was taken correctly.

For safety's sake, you should enter credit-card information only on pages that are on secure servers (or SSLs, in the jargon of the Web). Usually, your Web browsing software will alert you when you load a secure page. If you are on a secure page, you should see a tiny icon of a locked padlock or an unbroken key in the status bar at the bottom of your Web browser window.

A secure page encrypts the information -- puts it into secret code -- so that even if someone intercepts the data, it can't be read.

Usually, if you're buying stuff over the Internet, the merchant requires you to select a user name and a password. When you choose a password, write one that can't be guessed easily. Stay away from the names of pets or family members, birth dates, your Social Security number or phone number.

Most online merchants reply to an order by e-mailing a confirmation notice that lists the items and quantities bought. Check that carefully and respond quickly if there has been a mistake.

Generally, it's safer to use a credit card than to use a debit card. With some debit cards, you could wind up paying for the entire loss if a crook taps into your account. On the other hand, you are liable for up to $50 if someone uses your credit card fraudulently.

Some Web merchants go even further. Amazon.com and Barnes & Noble, for example, will cover up to your $50 in liability for unauthorized use of your card that's no fault of yours -- for example, if someone stole your credit-card information while you were using their secure server.

Read the terms and conditions
Many retailers on the Web have a "terms and conditions" link at the bottom of the home page. You have to look carefully; the type usually is the size of an ant's eyelash. But some of the most important information is behind that link.

Information about return policies, for example.

A terms-and-conditions page might have information not only about return policies but also about shipping rates, sales taxes, cancellation policies and payment options. Pay close attention because sales tax and shipping charges can differ.

Mark Elliott Budnitz, a professor at Georgia State University's Law College, recommends that you print out key pages and read them on paper to make sure you completely understand it.

"When you're doing business on the Internet, it really is different," says Budnitz, who belongs to an American Bar Association working group that is studying consumer protection in cyberspace. "You don't have written pieces of paper you can look at. So an important consideration for consumers is if you can print something out."

What other consumers say
In the future, you might see Web-based message boards for e-commerce retailers. This is already the case with pay-per-view adult Web sites, says Mark Tiarra, a consultant for pornographic sites. He says there are two major message boards that operators of adult sites can post to, and which customers can peruse to find out who is considered reputable and who is being criticized.

"Anything the adult industry does filters down to the non-adult industry," Tiarra says.

You don't have to use only technology to check up on retailers. Perhaps the best way to discover a store's reputation is to rely on non-computer-mediated interpersonal communication.

In other words, word of mouth.

-- Updated: Jan. 18, 2002

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