Assignment 11: Online Auction Scams
Buyers Losing Thousands To Scam Artists
POSTED: 10:00 p.m. PDT September 22, 2003
UPDATED: 10:06 p.m. PDT September 22, 2003
SAN JOSE, Calif. -- The online auction business is growing by leaps and bounds with thousands of new buyers and sellers going onto eBay every day, but it's not risk-free.
An NBC11 and MSNBC.com investigation found hundreds of people losing thousands of dollars to online scam artists.
If you want a plasma-screen television, it'll cost you about $13,000 at retail price. But if you go online, the same TV set can be had for a fraction of the price. Todd Semm found one for $2,500, NBC11's Scott Budman reported.
"And I thought to myself, this deal is way too good to pass up, and when I e-mailed the guy, he seemed legit," said Todd Semm, a scam victim.
Semm was wrong. The seller convinced him to send the money outside of the eBay system through Western Union. Todd never got his TV set, couldn't find the seller and the money was gone.
"I was totally sick to my stomach. I really couldn't afford $2,500 for the TV anyways, and now the fact that I don't have a TV and I'm out 2,500 bucks, and it's awful," Semm said.
Bob Sullivan, a senior writer for MSNBC.com, says eBay buyers don't have much protection from sophisticated scam artists.
"EBay doesn't release specific statistics on just how many people are scammed, but I can tell you from victims I've spoke to, certainly hundreds, if not thousands, of people have lost amounts of money that are similar to what Todd lost," Sullivan said.
EBay's fraud unit does look into every claim made by its users. In some cases, offering $200 reimbursements.
"There are plenty of critics out there who say eBay is not doing enough," said Kevin Pursglove, of eBay. "And if it's a more significant transaction, we can work with law enforcement agencies to narrow the search for those who are committing the fraud."
Sullivan says it's almost impossible to tell if a seller is legitimate. Some scam artists, like the one who burned Semm, even impersonated a seller who had a good reputation on eBay.
"I've read about it happening to a lot of different people. I just wish I'd read those articles a week earlier," Semm said.
To avoid being scammed, you should beware if a seller insists you:
Send money overseas
Send money via wire transfer or Western Union
Work outside the eBay system because it's cheaper
There are one-of-a-kind items to be found online. It's a great source. But be careful, ask hard questions and don't assume you won't be a victim, Budman said.
"I would swallow really hard before I spent more than a couple hundred dollars on eBay, I can tell you that," Sullivan said.
EBay also has a user rating system so you can tell what previous buyers and sellers think of the person you're doing business with, Budman reported.
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