The Warning Signs Of Online Fraud And
How To Avoid It By
Donald Lee
The number may seem grim for Web-based commerce. In 2004 in the Unites
States alone, computer users logged in more than 207,000 Internet fraud reports
to the U.S. Internet Crime Complaint Center. If you look hard at this
number, you may be astounded, and a good bit frightened, by the
implication. You may ask, “Is it really safe to buy and sell at an
online site?”
Put simply, the answer is: yes. The Internet is an incredibly powerful
tool for business, so you can’t pass it over just because of a few
crooks and conmen—even if they do seem like they’re behind every pop-up
window and banner ad. The truth is that you can create opportunity
and
make more money online
than you could lose in fraud.
Better yet, you could lose absolutely nothing if you know the warning
signs of fraud and the tricks to avoid danger during your
Web-based
business dealings.
Whether you’re looking to buy or sell goods online, the first - and the
best - way to fight fraud is prevention. There are certain warning
signs to watch for, which should set off a chorus of alarms and
flashing red lights in your head. Don’t do business with this person!
For buyers, these potential warning signs can be when a seller:
• asks you to pay through non-traceable avenues, such as Western Union
or MoneyGram, or a third party, or via an overseas address. You should
ask yourself—and the seller—why he or she won’t accept payment options
that are traceable and convenient for you.
• posts an image on his auction or classified ad that’s obviously from
an outside source. Sometimes these images may not even match the type
of item, let alone the brand, that the ad features.
• sells a typically expensive item at cut-rate prices, which is a good
indicator that it could be counterfeit.
• refuses to provide tracking numbers when you purchase an item.
Tracking numbers are another way to trace a valid transaction.
• offers only excuses, instead of help, when your purchased item
doesn’t arrive at your doorstep.
If you’re a seller, you ought to be wary of signs of a suspicious
buyer, such as when a buyer:
• asks to pay only some of the fee, offering to the pay the rest
sometime in the future. This is the old excuse from Popeye’s friend
Wimpy, who always could be heard saying, “I'll gladly pay you Tuesday
for a hamburger today.” Wimpy never paid Tuesday.
• sends you a cashier’s check for more money than the agreed price “by
mistake.” In this scam, the buyer then asks you to repay him the
difference by personal check, wire transfer, or money order—before you
find out that the cashier’s check didn’t clear. Believe it or not, this
scheme works because cashier’s checks can be cashed before they bounce.
• sends you a cashier’s check for the correct amount of money but then
demands a refund, requesting that you repay with your own money. See
the scheme above for how this trick works.
These warning signs, of course, are only for a handful of the frauds
and scams out there. Conmen are good at what they do, trying to
separate you from your money. That’s why it’s best to always follow
these golden rules of online commerce whenever buying or selling on an
Internet auction or classified site.
Keep your common sense. No matter how good a deal seems, or how much
clients say they want to pay, always remember the old adage: “If it
sounds too good to be true….”
Do your business locally. Try to buy and sell from your neighbors as
much as possible. It’s safer, more convenient, and better for your
local economy. What’s more, it saves you the trouble of dealing with
foreign vendors and buyers. Though they may be legit, dealing with them
can be complicated because of different legal systems and customs,
which can make any conflict difficult.
Seal the deal with plastic. Paying for items with credit cards, and
allowing your customers to charge for purchases, is a great all-around
business decision. Under U.S. law, all plastic purchases are protected
from fraud and allowed to be disputed in case of problems.
Meet at the middle man. Intermediary services are virtual middle men
that protect both buyers and sellers from cyber shysters. Services like
Escrow
act as a holding pen for both payment and sale items
until both the buyer and seller are content. Only then will Escrow
finish a transaction.
Purchase
with PayPal. As Escrow and credit cards do, PayPal guards against fraud
for both buyers and sellers. It’s a secure and reliable way to transfer
money over the Internet. No wonder PayPal is the most popular online
money transfer service.
As you can see, the odds are actually in your favor when it comes to
doing business on online classified or auction sites. The resource of
the internet is far too valuable than to be taken away by a few crooks
and conmen. It simply comes down to being smart, sensible, and
observant whenever buying or selling on the Web. Then again, that’s
what all good business is about, whether you’re doing it in a mall or
on the information superhighway.
About
the Author:
Donald Lee is the public relations manager for
Buysellcommunity.com. Buysellcommunity provides free classified listing
services for individuals and businesses to market their products and
services online. For global and localized classifieds, please visit
http://www.buysellcommunity.com - Free Buy & Sell Classifieds
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