Internet Auctions

Thinking of bidding in an online auction? What about selling some of your stuff? Internet auctions are a great resource for shoppers and sellers, but you need to watch out for a few pitfalls. Here's how:
Evaluate:
  • How soon do you need to receive the item you're bidding on? Can you tolerate it being delivered late, or not being delivered at all?
    • Many complaints about internet auction fraud involve late shipments, no shipments, or shipments of products that are not the same quality as advertised.
  • Whether you're a buyer or a seller, read each auction site's Terms of Use before using it for the first time. 
    • Sites may charge fees, follow different rules, or offer different protections.
  • Carefully consider your method of payment.
    • Learn what resources you have if something goes wrong. Don't send cash, and don't use a money wiring service.
  • Don't reply to phishing emails. 
    • Messages that look like they've been sent by an auction website or payment service and ask for your password and other personal information. 
  • Know who you're dealing with.
    • Avoid doing business with sellers you can't identify, especially those who try to lure you off the auction site with promises of a better deal. 
    • Confirm the seller's telephone number in case you have questions or problems.
  • Know exactly what you're bidding on.
    • Read and print a copy of the seller's description of the product closely, especially the fine print.  Save copies of all emails you send and receive from the auction site or seller. 
Understand:
Internet auction sites give buyers a virtual flea market with new and used merchandise from around the world; they give sellers a global storefront from which to market their goods. But the online auction business can be risky. OnGuard Online wants to help buyers and sellers stay safe on internet auction websites. Among the  thousands of consumer fraud complaints the Federal Trade Commission (FTC) receives every year, those dealing with online auction fraud consistently rank near the top of the list. The complaints generally deal with late shipments, no shipments, or shipments of products that aren't the same quality as advertised; bogus online payment or escrow services; and fraudulent dealers who lure bidders from legitimate auction sites with seemingly better deals. Most complaints involve sellers, but in some cases, the buyers are the subject.

Whether you're a buyer or a seller, understanding how internet auctions work can help you avoid most problems. 


Review:
Review the role of the auction site: Most auction sites  specialize  in person-to-person activity where individual sellers or small businesses sell their items directly to consumers. In these auctions, the seller--not the site--has the merchandise, and often, the site will not take any responsibility for any problems that may arise between buyers and sellers. Before using an internet auction site for the first time, review any information offered by the site.
  • Registration:
    • Most sites require buyers and sellers to register and obtain a "user account name" and password before they can make bids or place items for bid. Keep your password to yourself. If you share it, another person can access your account and buy or sell items without your knowledge. That could damage your online reputation--and eventually, your bank account.
  • Fees:
    • Some sites require sellers to agree to pay a fee every time they conduct an auction, whether the item is sold or not. Other sites only charge a fee when an item is sold. 
  • The Auction
    • Many sellers set a time limit on bidding, and in some cases, a reserve price. When the bidding closes at the scheduled time, the item is sold to the highest bidder. If no one bids at or above the reserve price, the auction closes without being sold. 
  • After the Auction: Arranging to Pay and Deliver Merchandise
    • At the end of a successful auction, the buyer and seller communicate--usually by e-mail--to arrange for payment and delivery. 
 
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