Internet auctions are awaited
with eager expectations by online shoppers, who get to buy a widerange of
products at affordable rates. The sellers stand to benefit equally as they can
minimize the cost of conducting physical sales, while being able to pitch their
products before buyers from far away places. Time and space constraints are
ruled out resulting in huge savings for the seller. Participants experience the
comfort of bidding from their home or offices, which makes the whole buying
process a lot simpler.
- The Internet Auction Process
A bidding fee is required to be
deposited. The internet auction begins with different buyers placing their bids
for a product and the deal is closed with the highest
bidder. As a variant, in the case of Dutch auctions, a very high price is fixed
by the auctioneer, which gets lowered systematically by the bidders, until the
ultimate buyer accepts a price. In case of sealed-bid auctions, the bids are
not made in public. Another type of auction is the reverse auction where the
roles of buyers and sellers actually work in reverse. This is carried out when
the buyer has a business to sell and more than one seller competes to buy the
same. But auction is not free from online scam.
- Delivery or products in damaged condition
Scammers operate and conspire to
cheat the buyers who may not be shopping savvy at internet auctions. Non delivery
or delayed delivery of products is a loss to the buyer. The product may be delivered
in damaged condition or with defects. Sometimes, electronic products may be
delivered without proper installation or usage instructions. The promised
instruction DVD or CD is absent.
- Misrepresentation of Product
People who participate, bid and
shop for a particular product that has been put up for internet auction, do not
eventually receive the same product. This type of online scam in auction called
misrepresentation of products.
Products of antique value or products that are
autographed by celebrities sell like hot cakes in online auctions. But they may
not be genuine. The buyer’s knowledge is limited to the seller’s word that the
product is original. In reality, it may be a fake product. He receives product
of a much lesser value after paying an exorbitantly high rate.
- Offering second auction chances
Unscrupulous people may approach
the losing bidders immediately and offer them another opportunity to bid. They
are beguiled into landing in unsafe auction sites without their knowledge. The
fake sites may not offer the same terms and conditions as the original site.
Buyers who are unmindful of the fraudulent navigation, fall prey to the online
scam.
- Embezzlement of payment
In case of online scam, the
scammer demands payment via credit card or wire transfer. Both are risky since
the buyer is exposing his bank account or credit card details online. Scammers
in no time can manipulate the information and rip the buyers off their life
time savings. Use of secure payment processors like PayPal is highly
recommended.
- Online scam from escrows
Escrows are typically middlemen
between the buyer and seller in an internet auction. They bridge the gap
between payment of money and delivery of product. But fake escrows only take
the money and do not deliver the product. Sellers become victims when they
deliver the products wait for payment from middlemen.
