Internet auctions offer great deals … and steals

BBB advises how to bid safely and successfully

Who hasn’t heard at least one friend brag about the great price they got through an on-line auction? Whether the item is new or used, unique or commonplace, the winning bidder feels a sense of accomplishment. When the purchase arrives as advertised, both the seller and the buyer end up satisfied.

Unfortunately, online auctions do not always offer a happy ending. Better Business Bureaus regularly receive complaints from Internet auction bidders who believe they were defrauded.

“There are some pretty sad tales,” said Elizabeth Merkel, president of the Better Business Bureau of New Jersey. “Some buyers fail to receive any merchandise whatsoever; others receive an item that in no way resembles what was advertised. There are buyers who report being misled about the terms of the sale. We also hear from bidders who were tricked into using fake escrow sites when paying for their purchase.”

BBBs in the United States and Canada are reaching out to on-line shoppers this summer to emphasize how to bid safely and successfully at Internet auction sites.

“If you use care and common sense, you will secure some great bargains by avoiding unethical sellers,” Merkel said.

To help ensure satisfactory Internet auction transactions, the BBB encourages bidders to:

+ Choose legitimate auction Web sites. Carefully read directions for bidders and know upfront what types of protection (insurance, guarantees, etc.) the site offers.

+ Verify the seller’s identity and check their feedback rating before placing a bid. If you can’t find any information on the seller, avoid doing business with them. Don’t rely on e-mail alone; some sellers use a forged e-mail header. Get the seller’s phone number and confirm that it is in service.

+ Know the terms of the transaction. Who pays for shipping and delivery? Does the item come with a warranty? What is the seller’s return policy?

+ Insist on paying with an on-line payment service or a credit card. If you don’t receive the merchandise, you can challenge the charges with your credit card issuer.

+ If you decide to use an on-line payment service, know what protection you are afforded if the seller fails to ship the goods. Using a credit card to pay for goods through an on-line payment service will afford you “charge back” rights.

+ Be cautious if the seller asks you to pay by check or money order, because you will have little recourse if the transaction goes awry. The Federal Trade Commission recommends in general that buyers not wire money, either. If something goes wrong with the transaction, the buyer most likely will lose their payment.

+ If the purchase is a big one, you might want to use a third-party escrow service that will hold your payment until you receive and approve the merchandise. Always verify that the escrow service is a reputable company. If the seller insists you use a specific escrow service and you cannot confirm its legitimacy, back away from the deal.

“This final tip is particularly important,” Merkel said. “Some buyers unwittingly do business with fraudulent escrow sites solely on the recommendation of sellers.”

In fact, according to a press release, some scam artists have gone so far as to use the Better Business Bureau logo or name to try to convince buyers that an escrow service was operated or endorsed by the BBB. Shoppers are advised to always contact the BBB when there are questions concerning the legitimacy of a service or retailer.

“It’s particularly important to check with us if you see the Better Business Bureau name being used in an unusual manner. We don’t, for instance, manage financial transactions for on-line merchants nor are we an escrow service,” Merkel said.