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Internet auction fraud is a growing epidemic worldwide, as online shopping has grown significantly every year that online shopping has been available. 51,000 cases of internet fraud cases were reported in 2002. In 2006, that number ballooned to 97,000. The numbers are staggering, but everyone can lower their risk by knowing what auction fraud is, how to detect it, and how to prevent falling for it.

Most internet auction fraud cases involve straightforward scams where consumers allegedly win merchandise by being the highest bidder. All sounds good until they send the payment and never receive the merchandise.

Below are some tips on keeping your risk at a minimum when purchasing items from an online auction website:
· Understand as much as you can about how the internet auctions work, what your obligation are as a buyer, and what the seller’s obligations are before you bid. If you can’t find anything out about the seller, than avoid doing business with them. Never fall for promises of better deals by moving away from the original auction website.

· To avoid unexpected cost, you must read the information in the listing about shipping and handling fees carefully. If not specified, you may want to clarify before you start bidding.

· Do not simply disclose your personal data – if you see e-mail messages from someone you do not know that ask you for personal data for examples, credit card number, account number, or password, do not just send the data without knowing more about who is asking.

· Review the feedback rating for the seller, and use common sense; if the seller has a history of negative feedback, then the participants do not bid with the particular seller.

· Always save 100% of the transaction information and must ask the seller when delivery can be expected if not specified in the listing, and about warranty, exchange or return of merchandise you find unsatisfactory.

· When giving your credit card details or your debit account details at a website, check that the Internet connection you are using is secure. Look for the lock at the bottom or https (an‘s’ appended to ‘http’) in the address field of your browser. These indicate that the connection is a secure one.

· Be aware of phishing. Verify that you are receiving emails from the correct source and that you are logging in at the correct website.

· When making payment, prefer using your credit card over online transfer. Using a credit card give you the opportunity of a chargeback in case the transaction turns out a fraud. Use debit card, wire transfer, or money order only when you completely trust the seller.

· If the seller wants you to use an escrow service you’ve never heard of, look into it. Check out the website. Call up customer support. Contact us to digg up data on the business in question. If you can’t confirm the legitimacy, don’t use it.

References:
http://www.onlineguards.com/topics/onlineauctionfraud.aspx
http://www.crimcheck.com/background-check-news/whats-internet-auction-fraud-and-how-do-i-prevent-it
http://ecommercesite.wordpress.com/2008/06/29/things-to-take-note-to-prevent-e-auction-fraud-when-a-consumer-participating-in-an-e-auction/