June 12, 2003

 

Consumers Need to Be Aware of Online Scams

The days of driving around town for hours looking for that perfect gift may soon be gone. Today, many consumers avoid the long lines and traffic by doing their shopping online. However, a North Dakota State University Extension family economics specialist, cautions consumers to be careful where they are spending their money.

Consumers need to learn how to protect themselves from crooks on the Internet. Recently released information by the National Consumer League indicates online auctions to be one of the biggest threats, says Debra Pankow, NDSU family economics specialist. Other scams to watch for are general merchandising sales, Nigerian money offers, computer equipment and software and Internet access service.

"There are ways to avoid these scams. Consumers need to be cautious and do research on a company before giving their personal information out," Pankow says.

Some tips for purchasing an item or bidding online are:

• Check the seller’s reputation. Information on unfamiliar companies or individuals can be obtained from the Better Business Bureau, or the state or local consumer protection agency. Contact the North Dakota Attorney General’s Consumer Protection Division at 1-800-472-2600.
• Look for information about insurance and understand the terms. Some auction sites offer insurance protection, but coverage is limited, there is a deductible and there may be exclusions.
• Pay the safest way. Paying the seller directly with a credit card may be safer than using a third-party online payment service.
• Use an escrow service for sellers that aren’t covered by insurance or your credit card dispute rights. The escrow service doesn’t pay the seller until you confirm that you got what you were promised.

Computers offer consumers a convenient way to compare prices and features before a purchase decision. It is important for consumers to take the next step and ensure that their purchase proceeds without dissatisfaction.

"Companies can make it seem like they are following proper guidelines. However, it is best to completely research a company and read all the fine print before committing yourself," Pankow says.

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Source: Debra Pankow, (701) 231-8593, dpankow@ndsuext.nodak.edu
Writer: Stephanie Renner, (701) 231-8371, srenner@ndsuext.nodak.edu
Editor: Richard Mattern, (701) 231-6136, richard.mattern@ndsuext.nodak.edu