The Citizens Advice service helps people resolve their legal, money and other problems by providing free, independent and confidential advice, and by influencing policymakers.
Every Citizens Advice Bureau is a registered charity reliant on trained volunteers and funds to provide these vital services for local communities.
Internet auction sites - a cheap purchase or an expensive mistake? |
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Problem solving charity Citizens Advice is urging people to be aware of the risks involved when paying for goods on Internet auction sites. Internet auction sites offer people a tempting shop window with a wide range of online merchandise ready to buy at the click of the button. People are now logging on to the Internet to buy and sell goods at bargain prices, often dealing with other users from across the globe. You may be able to negotiate some great purchases but be careful you are not ripped off by unscrupulous users. Citizens Advice reports seeing many cases where both buyers and sellers have been defrauded when using auction sites. People who use auction sites to buy and sell privately and then send payment or goods directly have very little protection; the sale is based on trust, which means there is a risk of losing your money. People who sell on these sites are not traders, so the usual consumer protection rights for faulty goods or goods that don’t arrive or don’t meet their description are limited. Evidence from Citizens Advice in its role as the UK European Consumer Centre (ECC) shows that even when people do use an intermediary service, such as an escrow service, they may not be as well protected as they think they are. An escrow service collects the payment for the item from the buyer, notifies the seller that it has received money, and tells the seller to send goods to the buyer. Once the buyer has examined and accepted the item, the escrow service forwards the payment to the seller. But for many people the safety and security they were seeking never materialises and they find that they have fallen foul of the terms and conditions that often protect the escrow service rather than the consumer. For example, if the credit card the buyer uses is stolen it may not be checked by the escrow service before the OK is given to send the goods. Escrow services terms and conditions may allow them to claim the money back from the seller in card fraud cases, meaning the seller loses out on both the money and goods. In one case a CAB client from London sold his mobile phone through an Internet auction site. At the auction site’s recommendation the client used an escrow service. After sending the mobile phone to the buyer and collecting payment the client learned that the buyer had used a stolen credit card number. The escrow company then used bailiffs to recover the sales proceeds from the client. The client is now without a mobile phone and has had to both refund the money to the escrow service and pay bailiffs’ costs.
A CAB client from the Midlands bought a car from an auction site for £6000. When it arrived the car had a major fault, which the seller had not disclosed. The buyer now faces a £3000 bill for the car. A client from the South East bought a game from someone in Germany through an Internet Auction. He sent off his money directly to the seller and has never received the goods. In another case a CAB client from the Midlands bid and paid for a computer on an Internet auction site. He paid £610.00 directly to the seller and has subsequently never received the computer. The client has since found out that the seller has applied for bankruptcy with debts in excess of £150,000 Susan Marks Social Policy Officer at Citizens Advice said:
Check out Citizens Advices top tips to avoid the auction site scammers.
Check the seller’s reputation. Most auction sites post feedback ratings of sellers based on comments by other buyers. Ask questions before you bid e.g. what is the returns policy? A good seller will always welcome enquiries. Do your homework. Check the description, type of model and retail price of the goods. Be wary: if the price is too good to be true, it usually is. If it’s a collectable item take steps to confirm it is authentic. Before you bid, find out what form of payment the seller will accept. If it’s only cheques or money orders, decide whether you are willing to take the risk of sending your payment before you receive the product. If possible, you should use a credit card (check your details are protected) because it offers the most protection if there’s a problem. Buyers should consider using an escrow service, which holds your money until the goods are delivered. But check their terms and conditions first. If you are selling ask if they verify the payment is authentic before they tell you it is safe to send off the goods. Before you submit a price think carefully. Know how much you are willing to pay, stick to it, and think whether you are getting value for money. Once a price is accepted you will be expected to pay. Read the small print. Is postage included in the price? How will the goods be posted? Do you need postal insurance? Is the seller based in the UK? If not what action can you take if things go wrong? Find out whom you are dealing with. If you are buying, is the seller a trader or an individual? Consumer protection laws are designed for traders selling to consumers, not for consumer-to-consumer sales. Notes to editors:
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