Fraud Tip of the Day - October 8

The Worst eBay Scams

Most eBay auctions run smoothly. The seller is paid and the winner of the auction receives the item they won at the agreed upon price. Once in a while, however, you may run into either a fraudulent buyer or seller that break eBay's rules in order to rip you off. It may be only a few bucks or it could be more, a lot more. Some eBayers have reported scams in which thousands of dollars in cash or goods have been stolen from them. If you're not careful and don't pay attention to red flags when you see them you could win an auction but lose big time. Today's Tip of the Day is devoted to the Worst scams on eBay. We hope you never stumble into one, but being aware of what can happen may help you avoid these scams. Some of these are simple and easy to avoid while others are more complex and require that you do some homework.

These are the worst scams on eBay in no particular order:

Shill Bidding

This is a rather basic one where a seller uses other id's or has friends raise the number of bids and value of an item. This has been going on for ever in car auctions where a "shiller" in the audience will bid against someone who is interested in a vehicle to drive the price up, and is just as popular with online auctions. Watch for recurring user id's on a sellers bids or for sellers who routinely bid - but don't win on each others auctions.

Bid Shielding

This one involves a ring of bidders who target an item they want and put in multiple bids. One for the price they want, and then a series of bids that inflate the item to scare off any other bidders. Moments before the bidding ends, the high bidders retract their bids and the low bid wins the auction. Watch for bidders who have a history of retracting bids.

Switch and Return

Some dishonest buyers will purchase your item, receive it and then return it. The scam: The item they return is not yours but theirs and is an attempt to upgrade their item for free at your expense. Watch for bidders who are overly interested in your return policy.

Fakes and Reproductions

It's a mistake to think that a certificate of authenticity is proof that an item is real. Think about it, if a seller is willing to misrepresent a fake item as real, then what is the big deal of throwing in an authentic looking certificate verifying the value of the property. Watch out for items that are scarce suddenly appearing in mint condition online. Also watch for any type of comment in the description that gives the seller an out if the product turns out to be fake such as "To my knowledge" or " think"

Nigerian 419 Scams

These scams vary in complexity and in the details but a common thread is payment from overseas by a check or money order that turns out to be a counterfeit. The buyer will often offer more money than you asked in the hope your greed will subdue your skepticism. One variation of a Nigerian scam involves overpayment. The money order or check will be more than the asking price. The buyer will ask that you send the amount that was overpaid back to them. If you send them this money before the check or money order clears the bank you could be out a lot of money. You will have sent them the auction item, paid for the shipping and refunded some cash out of your own pocket!

If you think you've encountered a crooked seller or a buyer, report them to Ebay's safe harbor.