smart spending

6 tips for safe online shopping

At $100, the laptop you just found online makes for an amazing deal. Good thing you finally left those big retail Web sites and searched on smaller ones whose domain names you've never heard of. Otherwise, you would have never discovered this incredible price.

The Web site itself looks legitimate, too. Its checkout page has legal disclaimers and asks for the usual billing and shipping information. It says it's secure.

But is it?

If you don't know from whom you're buying, and are simply praying for good luck after sending your payment over the Web, you're setting yourself up -- and not just for losing money. You're risking your personal information, and it's time for a rude reality check.

It makes sense that security is not always a bedfellow of convenience. Open 24 hours a day from anywhere in the world, online shopping sites entice consumers with an array of come-ons such as free shipping, comparison pricing, bargain deals and extra security features. Saving gas, and being able to shop on your schedule, adds more to the online shopping appeal.

Yet, the question remains for the leery: Can online shopping be done safely?

The Internet security experts we spoke with say "yes" -- on the condition that consumers abide by some basic safety tips.

1. Bigger names equal better protection.
"Go with reputable companies you've heard of," says Jim Stickley, co-founder, CTO and vice president of engineering at TraceSecurity, a company that works with financial institutions to better their network security systems to deter identity thieves.

Stickley, who knows firsthand how easily sensitive information is stolen, says that if a deal sounds too good to be true -- say, $20 for an iPod Nano -- it probably is. What's worse, it's probably an attempt to trick you into giving out personal information.

Steven Branigan, founder and president of CyanLine and author of "High Tech Crimes Revealed" agrees and says that it's good to know the site you're going to, such as the bigger sites like Amazon.com. "These sites put their name on the line."

On the other hand, the fear factor hurts smaller merchants who might have better deals.

One comparison shopping site, buysafeshopping.com, solves both problems by bonding qualified merchants for up to $25,000 with Liberty Mutual, Travelers and ACE USA. BuySAFE puts merchants through a screening process to verify the merchant's identity, online sales experience and ability to deliver the purchased items. If a retailer passes that process, buySAFE is willing to stand behind them with its purse, says Jeff Grass, CEO and president, and Rob Caskey, senior director of buyer marketing.

2. When in doubt, check them out.
If you go with an unknown merchant or Web site, contact someone there who can verify the company's privacy policy for you before you make a purchase. Ask if they'll send you a catalog.

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"If they don't list phone numbers and only have an e-mail address, that's a huge red flag," Stickley says. "Call the phone number and see if it goes to voice mail. Anyone can have voice mail set up."

Bottom line: If you can't get a human being on the phone or don't like what you're hearing, go shopping somewhere else.

-- Updated: Nov. 7, 2006

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