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 - Tips When Paying at Auctions Online

Paying Tips at an Online Auction

Despite complaints of fraud, online auctions remain a fun, efficient and relatively safe way to do business — if you act prudently. Here's how:

  • Know and understand what form of payment the seller accepts. If the seller accepts only cashier's checks or money orders, decide whether you're willing to risk sending your payment before you receive the product.

  • Protect your privacy. Never provide your Social Security number, driver's license number, credit card number, or bank account information until you have checked out the seller and the online payment or escrow service, if you're using one, to ensure legitimacy.

  • If the seller insists on using a particular escrow or online payment service you've never heard of, check it out. Visit its Web site. A site that is generally of poor quality with, say, misspelled words or claims that the service is affiliated with the government, is suspect. Call the customer service line. If there isn't one or if you call and can't reach someone, don't use the service.

  • Before you agree to use any online payment or escrow service, read the service's terms of agreement:
    • If it's an online payment service, find out whether it offers buyers any recourse if sellers don't keep their end of the bargain, whether it prevents sellers from accessing their funds if buyers are not satisfied with the product, and who is responsible for paying for credit card charge backs or transaction reversal requests. If the online payment service cannot recover the loss from the seller, it might try to recover its loss from you, using the credit card or bank account information in its file. To limit your exposure, consider reserving a separate credit card, stored-value card or bank account to use just for online transactions.
    • Examine the online payment and escrow service's privacy policy and security measures. Never disclose financial or personal information unless you know why it's being collected, how it will be used, and how it will be safeguarded.

  • Be suspicious of an online escrow service that cannot process its own transactions and requires you to set up accounts with online payment services. Legitimate escrow services never do this.

  • Check with the Better Business Bureau, state attorney general or consumer protection agency — where you live and where the online payment or escrow service is based — to see whether there are any unresolved complaints against the service. Keep in mind that a lack of complaints doesn't necessarily mean that a service has no problems.

Source: FTC


Visit our Shopping Guides and Credit Card Fraud sections for useful information.


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