Things to take note to prevent e-auction fraud when a consumer participating in an e-auction.

Ebay.com is one of the popular auction websites where users can get products for low price. But before bidding for a product, we should consider some aspects. Fraud might be conducted by customers or by sellers. Some times consumers may send fake checks or fake account details to the sellers. But, most of the fraud cases are conducted by sellers. According to the statistics of National Internet Fraud Watch Information center, Most of the internet frauds are based on online auctions. Forty five percent of online frauds are based on e-auctions, reported in 2005.

E-Auctions

In online auctions, buyers compete to grab desired products for low price. But before going to bid, we should consider that sellers play some tricks to lure the buyers.

1.Bid shielding:
Bid shielding is one of the ways to mislead the real bidders. Fake bidders starts bidding with very high price and they drop from the bidding at last minute. The real bidder who bid for low price would win the bid and he needs to pay for it. All this is just to mislead the real buyer’s concentration to their products.

2.Shilling:

In shilling, sellers arrange fake IDs and start bidding as buyers. The real bidders lure to the particular product and they bid it for little bit high amount than previous. In this way sellers get more benefit.

3.Hidden shipping costs and handling fee:

Sellers hide the real shipping cost and handling fee. By the time buyers get the product, they might need to pay more than they expected.

4.Failure to deliver:

Some times buyer will never get the product even after he/she paid for it. This is an old type of cheating method.

5. Damage and loss claims:

This type of frauds might be from buyer’s side. Buyer tries to claim new product or refund by reporting the seller that they never got products or they got damaged product. Some times seller can not prove the delivery of product.

Prevention of online auction fraud:

1.Buyers could buy products on secured websites only.
2.Buyers can know the website security by checking security certificate of website on browser.
3.Buyers could check the seller reputation and feedback.
4.Buyers can contact the seller and inquire about all required information.
5.Victims of fraud should report the fraud information to the website management as well as Internet fraud repot. This would help to delete cheater account and sentence him.