E-auctions (or electronic reverse auctions as they are sometimes called) are on-line auctions where selected bidders submit offers electronically against the purchaser’s specification. All communication following and including the invitation to pre-qualified bidders to submit new prices and/or values must be instantaneous (electronic). Electronic auctions can be used for goods, services and works. Only price and quality elements which can be expressed as a value suitable for incorporation within a formula can be included at the auction Stage. Other quality aspects must be assessed prior to the auction stage.
There are some types of e-auction fraud:
1) Bid Shielding (by the buyers)
- Done by a buyer to keep the price high until the end of an auction to discourage other bidders. The high bid is retracted leaving the buyer’s second account as the new high bidder. Note that a buyer has to have two separate accounts or a partner to accomplish this. With eBay’s new rules on late bid retractions, it is more difficult, but not impossible to ahield low bids.
2) Shilling(by the sellers)
- Sellers arrange to have fake bids placed on their items (either by associates or by using multiple user IDs) to artificially jack up bids. If the legitimate high bid does not meet their expectations as the end of an auction draws near, they might pop in to sell the item themselves.
The below following are the things to take note to prevent e-auction fraud when a consumer participating in an e-auction:
1)Become familiar with the auction website. Look and search into the websites protection policies. Consumer need to do some research about the e-auction process so that would be more familiar. Look into some of the e-auction website for example, eBay and Amazon.
2) Never ever simply give out your personal data, social security number, credit card number, or bank account information. Do not simply open that information until you have thoroughly checked out the seller and the escrow service. For example, if there are some e-mail messages from someone that you don't know who asking about your personal data such as account number, password, and credit card number which cannot just send the information without knowing more about who they asking.
3)Buyer protections such as the PayPal Protection Program shield buyers by covering up to $500 of their purchase at no additional cost. For example, the eBay Standard Purchase Protection Program provides up to $200 coverage (minus a $25 processing cost) for items that are not received or items that are not as described in the listing.
4) If you’re going to pay with a money order or a check, use an escrow service. Otherwise the seller could be gone with your money when you realize the goods are not what you expected. For details on how escrow services work for auctions, see auctions.yahoo.com and ftc.gov.
5)Many sellers don’t have process credit cards. But they might accept payments through such services as PayPal. It accepts common credit cards. The buyer makes the payment through PayPal’s Web site (http://www.paypal.com/), and the seller will immediately paid. The service is free to the buyer, while the seller pays a small free.
6)Consumers should read the requirements and conditions that the website requested. Bear in mind the specific conditions especially the conditions of payments.
7)Review the feedback forum rating for the seller.If the seller has a history of negative feedback, then the participants do not bid with the particular seller.
8)If after the sale you feel the item or payment should have been delivered already, try to work it out with the seller or buyer. Must check the received goods carefully. If there are any damage or unmatched, you must return back to the seller within the duration. Furthermore, if at that point you feel that fraud is involved, immediately contact your state attorney general’s office and the FTC at http://www.ftc.gov/
1) Bid Shielding (by the buyers)
- Done by a buyer to keep the price high until the end of an auction to discourage other bidders. The high bid is retracted leaving the buyer’s second account as the new high bidder. Note that a buyer has to have two separate accounts or a partner to accomplish this. With eBay’s new rules on late bid retractions, it is more difficult, but not impossible to ahield low bids.
2) Shilling(by the sellers)
- Sellers arrange to have fake bids placed on their items (either by associates or by using multiple user IDs) to artificially jack up bids. If the legitimate high bid does not meet their expectations as the end of an auction draws near, they might pop in to sell the item themselves.
The below following are the things to take note to prevent e-auction fraud when a consumer participating in an e-auction:
1)Become familiar with the auction website. Look and search into the websites protection policies. Consumer need to do some research about the e-auction process so that would be more familiar. Look into some of the e-auction website for example, eBay and Amazon.
2) Never ever simply give out your personal data, social security number, credit card number, or bank account information. Do not simply open that information until you have thoroughly checked out the seller and the escrow service. For example, if there are some e-mail messages from someone that you don't know who asking about your personal data such as account number, password, and credit card number which cannot just send the information without knowing more about who they asking.
3)Buyer protections such as the PayPal Protection Program shield buyers by covering up to $500 of their purchase at no additional cost. For example, the eBay Standard Purchase Protection Program provides up to $200 coverage (minus a $25 processing cost) for items that are not received or items that are not as described in the listing.
4) If you’re going to pay with a money order or a check, use an escrow service. Otherwise the seller could be gone with your money when you realize the goods are not what you expected. For details on how escrow services work for auctions, see auctions.yahoo.com and ftc.gov.
5)Many sellers don’t have process credit cards. But they might accept payments through such services as PayPal. It accepts common credit cards. The buyer makes the payment through PayPal’s Web site (http://www.paypal.com/), and the seller will immediately paid. The service is free to the buyer, while the seller pays a small free.
6)Consumers should read the requirements and conditions that the website requested. Bear in mind the specific conditions especially the conditions of payments.
7)Review the feedback forum rating for the seller.If the seller has a history of negative feedback, then the participants do not bid with the particular seller.
8)If after the sale you feel the item or payment should have been delivered already, try to work it out with the seller or buyer. Must check the received goods carefully. If there are any damage or unmatched, you must return back to the seller within the duration. Furthermore, if at that point you feel that fraud is involved, immediately contact your state attorney general’s office and the FTC at http://www.ftc.gov/
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