Things to take note to prevent e-auction fraud when a consumer participating in an e-auction
Author: Paragons // Category: Week 6By Mei Hoong
What Is E-Auction Fraud?
Internet auction fraud is a growing epidemic worldwide, as online shopping has grown significantly every year that online shopping has been available. Everyone can lower their risk by knowing what auction fraud is, how to detect it, and how to prevent falling for it.
Types of E-Auction Fraud:
1. Bid shielding (a buyer’s action)
Having phantom bidders bid at a very high price when an auction begins; they pull out at the last minute, and the bidder who bid a much lower price wins.
2. Shilling (a seller’s action)
Placing fake bids placed on auction items to artificially jack up the bidding price.
3. Fake photos and misleading descriptions
Some sellers distort what they can truly sell. Borrowed images, ambiguous descriptions, and falsified facts are some of the tactics that sellers might employ to convey a false impression of the item.
4. Failure to ship merchandise (a seller’s action)
This is the old collect-and-run routine. Money was paid out but the merchandise never arrives.
5. Loss and damage claims (a buyer’s action)
Buyers claim they never received an item or received it in damaged condition and then ask for a refund. The seller sometimes cannot prove whether the item ever arrived or whether it was in perfect condition when shipped.
Protecting Against A-Auction Fraud:
Become familiar with the auction website. Look into the websites protection policies. Never assume you are protected from auction fraud.
Before placing a bid, learn as much as you can about the seller. If you can’t find anything out about the seller, than 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. Contact us to dig up data on the business in question. If you can’t confirm the legitimacy, 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.
1. Verification
One way of confirming the identity and evaluating the condition of an item is through verification. With verification, neutral third parties will evaluate and identify an item through a variety of means. This provides a way of tracking an item if it changes ownership in the future.
2. Feedback Forum
The Feedback Forum allows registered buyers and sellers to build up their online trading reputations. It provides users with the ability to comment on their experiences with other individuals.
3. Escrow services
With an easy-to-access link to a third-party escrow service, both partners in a deal are protected. The buyer mails the payment to the escrow service, which verifies the payment and alerts the seller when everything checks out. At that point, the seller ships the goods to the buyer. After an agreed-upon inspection period, the buyer notifies the service, which then sends a check to the seller.
4. Nonpayment punishment
To help protect sellers, first-time nonpayment results in a friendly warning. A sterner warning is issued for a second-time offense, a 30-day suspension for a third offense, and indefinite suspension for a fourth offense.
5. Appraisal services
Appraisers use a variety of methods to appraise items, including expert assessment of authenticity and condition and reviewing what comparable items have sold for in the marketplace in recent months. An appraised value is usually accurate at the time of appraisal but may change over time as an item becomes more or less popular in the marketplace.
One way of confirming the identity and evaluating the condition of an item is through verification. With verification, neutral third parties will evaluate and identify an item through a variety of means. This provides a way of tracking an item if it changes ownership in the future.
2. Feedback Forum
The Feedback Forum allows registered buyers and sellers to build up their online trading reputations. It provides users with the ability to comment on their experiences with other individuals.
3. Escrow services
With an easy-to-access link to a third-party escrow service, both partners in a deal are protected. The buyer mails the payment to the escrow service, which verifies the payment and alerts the seller when everything checks out. At that point, the seller ships the goods to the buyer. After an agreed-upon inspection period, the buyer notifies the service, which then sends a check to the seller.
4. Nonpayment punishment
To help protect sellers, first-time nonpayment results in a friendly warning. A sterner warning is issued for a second-time offense, a 30-day suspension for a third offense, and indefinite suspension for a fourth offense.
5. Appraisal services
Appraisers use a variety of methods to appraise items, including expert assessment of authenticity and condition and reviewing what comparable items have sold for in the marketplace in recent months. An appraised value is usually accurate at the time of appraisal but may change over time as an item becomes more or less popular in the marketplace.
Related links:
http://www.crimcheck.com/background-check-news/whats-internet-auction-fraud-and-how-do-i-prevent-it
http://72.14.235.132/search?q=cache:vjlGWXVLufUJ:faculty.ksu.edu.sa/alnaeem/IS%2520480/CH_7_8_10.ppt+prevent+e-auction+fraud&hl=en&ct=clnk&cd=15
http://72.14.235.132/search?q=cache:Ae7TApOeJwoJ:wps.prenhall.com/wps/media/objects/260/267260/online_appendices/Turban-Appendix2A.pdf+prevent+e-auction+fraud&hl=en&ct=clnk&cd=16
http://www.crimcheck.com/background-check-news/whats-internet-auction-fraud-and-how-do-i-prevent-it
http://72.14.235.132/search?q=cache:vjlGWXVLufUJ:faculty.ksu.edu.sa/alnaeem/IS%2520480/CH_7_8_10.ppt+prevent+e-auction+fraud&hl=en&ct=clnk&cd=15
http://72.14.235.132/search?q=cache:Ae7TApOeJwoJ:wps.prenhall.com/wps/media/objects/260/267260/online_appendices/Turban-Appendix2A.pdf+prevent+e-auction+fraud&hl=en&ct=clnk&cd=16
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