7 Tips to Avoid Online Scams and Swindles
Annual online retail sales are expected to hit $250 billion this year as more people use this simple and convenient way to buy. But an increasing number of consumers are being ripped off through a variety of online scams. Still, buying and shopping on the Web can be relatively safe if consumers use a few precautionary measures and, a dose of self-protective skepticism. Below are seven tips to help avoid the scams and swindles that lurk on the Internet. (Forex scams are more common than you may realize. Know the signs before you throw your money away. Refer to Spotting A Forex Scam.) TUTORIAL: How To Manage Credit And Debt
Research the Company Before You Buy.
The major national brands with an online presence can be trusted. Before buying from unknown companies or brands, however, consumers should check out the seller through the Better Business Bureau, their State's Consumer Fraud division and/or the Federal Trade Commission Bureau of Consumer Protection. If possible, find another consumer who has bought from the firm or brand in question, and ask about the quality of the product, delivery time, and customer service.
Credit Card Caution: One.
Scrutinize your monthly credit card statement for unauthorized charges, or for charges that are not satisfactorily explained. This is a mandatory procedure for anyone who uses a credit card for shopping, and especially necessary if the card is used for online purchases. If you've been charged for something you didn't buy, immediately contact your credit card issuer. Many credit cards offer consumer insurance against fraudulent purchases, eliminating consumer liability for the debt.
Credit Card Caution: Two.
A different, unique credit card number may be assigned to each online site from which you buy, if you only make purchases through a few select destinations. Many credit card issuers offer this protective service. This unique, store-specific credit card number prevents someone who may have illegally acquired your number from using it to buy from another online seller. Ask your credit card company if it offers this service.
No Online Seller Needs Your Social Security Number.
Do not post your Social Security number online in a customer survey form. An online data survey sometimes accompanies an online purchase. Buyers are asked their age, gender, household income, zip code and other questions. The data is used for marketing purposes and to develop a buyer profile. But if you're asked for your Social Security number, leave that space blank and be very suspicious about whoever made that request.
If They Don't Deliver, You Don't Have to Pay.
Under FTC regulations, if a product you bought online is not shipped within 30 days from the day of your order, under certain circumstances you can instruct your credit card company to stop payment. Exceptions to the rule include a seller's statement before the sale, that delivery would be made later than the 30-day period or if the seller notifies you that the delivery cannot be made in 30 days; in this case you may either cancel your order or agree to wait longer for delivery.
Read The Small Print.
Understand all the terms of the sale before you make the purchase. Many firms post strict no-return or all sales are final terms as part of your purchase agreement. In most cases damaged merchandise or clothing of the wrong size may be returned. But some products may not be returnable.
Credit Card Fraud Protection.
Some credit card issuers offer total protection against fraud, eliminating 100% of a fraud victim's credit card charges if the fraud is reported promptly. Credit card firms also offer a spending watchdog service which alerts them to unusual purchases, overly expensive purchases or purchases from sources where there had been no prior transactions. Shop around for the most comprehensive credit card fraud protection. The offers are attractive and competitive because credit card companies want your business.
The Bottom Line
Online shopping is easy and convenient, and more people worldwide are being attracted to this "department store" at their fingertips. Online shopping can also be safe and secure, if consumers follow the few simple rules cited above. Be cautious, be skeptical, know the terms of every sale, know the extent of your credit card fraud protection and don't give out your Social Security number. (Do you know how to distinguish a real opportunity from a fraudulent one? See Wham Bam Micro-Cap Scam.)