Things to take note to prevent e-auction fraud when a consumer participating in an e-auction

This era, e-auction plays as an important role in electronic commerce, and many buyers and sellers enjoy the convenience and there is few popular e-auction website such as Ebay, Amazon, and some local e-auction website such as lelong.com has generate considerable income in doing business of electronic auction. Due to the convenience and rapidly increase of trade figures, many liar aim the area of e-auction and they start to deceive the user of e-auction. There is several types of e-auction fraud, such as:
1. Bid shielding: having fake bidders bid at very high prices and then later pull out at the last minute
2. Shilling : placing fake bids on auction items to artificially jack up the bidding price
3. Fake photos and misleading descriptions
4. Improper grading techniques
5. Selling reproductions
6. Failure to pay the auction house

So we should be aware of all types of e-auction fraud, and there is several ways to prevent e-auction fraud as well, such as :

1. User identity verification
Such in IC number, driver’s license number or date of birth. For example, verified eBay user, the voluntary program, encourages users to supply eBay with information for online verification.

2. Authentication service.
It is to determine whether an item is genuine and described appropriately. It difficult to perform because their training and experience, experts can detect counterfeits based on subtle detail.

3. Grading services
This is a way to determine the physical condition of an item, such as ‘poor quality’ or ‘mint condition. Different item have different grading systems. For example, trading cards are graded from A1 to F1, while coins are graded from poor to perfect recalculated.

4. Feedback forum.
It allows buyers and sellers to build up their online trading reputations. It provides user with ability to comment on their experiences with other.

5. Insurance policy
For example, eBay offers insurance underwritten, users are covered up to $200, will with a $25 deductible. The program is provided at no cost to eBay user.

6. Escrow services
Both buyers and sellers in a deal are protected with an independent third party. Buyer mails the payment to escrow services which verifies the payment and alerts the seller when everything checks out. An example of a provider of online escrow services s i-Escrow and 1hostMalaysia.
For 1hostMalaysia:

1HostMalaysia is the only ICANN Accredited Domain Registrar that has a special registrar escrow account devoted to domain escrow services. We have also partnered with Citibank, the largest financial services companies in the world, to make sure that escrowed funds will be protected while you’re buying or selling your domain names.

When you use 1HostMalaysia’s domain escrow services, you will receive:
Peace of Mind – the domain names will be transferred to escrow before funds are released to the seller.
Security – knowing that your financial information is going to a neutral third party and not a stranger.
Money Back Guarantee – if the seller doesn’t properly transfer the domain names, 1HostMalaysia will refund your money back to your account.
Convenience – deposit monies into escrow using credit card (Visa, MasterCard, American Express), personal, business, cashier’s or certified check, PayPal, or wire transfer.

7. Non-payment punishment
To protect sellers, a friendly warning for first-time nonpayment. A sterner warning is for second-time offense, with a 30 day suspension for a third offense and an indefinite suspension for a fourth offense.

8. Appraisal services
Which use a variety of methods to appraise items. It includes expert assessment of authenticity and condition, and reviewing what comparable items have sold for in the marketplace in recent months.

9. Item verification
Which is a way of confirm he identity and evaluate the condition of an item. Third parties will evaluate and identify an item through a variety of means. For example, some collectors have their item “DNA tagged” for identification purpose. It provides a way of tracking an item if it charges ownership in future.

10. Physical inspection
It can eliminate many problems especially for collectors’ item

refer to ( http://www.crime-research.org/library/Fraud.htm )