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Online Auctions
by David Chan - SVCL
Online auctions are beginning to take off on the Internet and
there are now hundreds of online auction sites. Some of the big
players are ebay and Yahoo!Auctions, which grow ever popular with
consumers hoping to purchase top quality goods are bargain prices.
However, auction sites have also become the target of many scams.
Auction sites are continually doing their best to combat fraud, but
it is nearly impossible to totally eliminate it due to the nature of
online auctions. There are a number of ways that online auction scams
occur. The most frustrating and obvious scam is when a buyer sends
money for a good, but it is never received. Because little contact
information is usually provided, it becomes a nightmare trying to
track down sellers.
A common scam is when sellers use a "shill", which is
either a friend or a second e-mail address, to pump up prices and
hopefully start a bidding war. Another scam involves a
"shield", which again is either a friend or a second e-mail
address, to discourage bids on an item by driving up prices. At the
last moment, they will withdraw their bid to obtain the item at a
cheap price.
Most online auction transactions are completed without problems,
but there are steps you can take to avoid being scammed. First of all,
make sure you read all the rules on bidding and listing items on an
auction site. When you decide to bid, do so on inexpensive items first
to reduce risk. Look at feedback on buyers and sellers, being careful
of users with negative or no feedback. Beware of sellers with little
billing information and anonymous e-mail addresses.
Make sure you know the retail price of the item you are bidding for
so you do not get caught out paying more than retail price when you
include shipping costs. Look out for shills and do not get caught up
in a bidding war. Shills often have an e-mail address with the same
domain name as the seller and have no feedback. Send money in a way
that can be traced, such as by cheque. If you are a seller, only send
products after you have received payment. Record the details of every
transaction including the original product description and bidding
history. Last, but not least, use common sense. As they say, if
something seems to good to be true, it probably is.
Online auctions have a bright future, and by taking the right
precautions, you should avoid being scammed and make the most of the
benefits it brings.
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