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Watch For Scams Newsletter, Issue #001 -- Auction scams more dangerous
July 01, 2009

How to Avoid the Common Auction Frauds

Watch For Scams is dedicated to helping you avoid becoming a victim of fraud.

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Auction Fraud

Auction scams account for 1 in 4 complaints received by the Internet Crime Complaint Center out of the total 70,000 complaints they received during 2008.

Computers, cars, coins, designer clothes and sports memorabilia are some of the common items on auction sites used to lure victims into a scam.

It may be the scammer that is selling these items, or you may be advertising them, and the scammers respond or bid.

The most common auction scams include:

* Overpayment scam. This scams targets sellers. If you are selling an item like a car, the scammer contacts you and agrees to pay the asking price. You will then receive a counterfeit check for an amount greater than your asking price. The reason given may include shipping costs if the buyer doesn't live locally or in the country, or that someone owes the scammer the amount the check is written out for, and that person is sending the payment. Whatever the reason, the buyer requests you to send the excess amount either to a shipping agent or to a bank account or to wire the money using a service like Western Union or MoneyGram. When you find out the check is fake, you are out of pocket the amount you wired to the scammer.

* Second chance scam. The scammers target the bidders in auctions who are unsuccessful and offer them the opportunity to buy the item they wanted at a cheap price. They will want you to send the money through a wire transfer, and of course, you will never see the item you purchased.

* Wire transfer scam. Popular or big ticket items will be advertised by the scammers at very cheap prices to lure the victims. If you agree to purchase the item you will be required to wire the money to the scammer, and again, you won't receive the item.

The people committing these scams are mainly individuals, although groups in West Africa like the overpayment scam, and Romanian crime groups like the second chance scams.

Our Advice for Auction Scams.

* Don't accept overpayments for an item you are selling, it is a sure sign of a scam

* Use a legitimate online escrow service for valuable items

* Be skeptical if the price is very low, and the seller insists on wire transfer as the only payment method

* Don't provide your personal details such as account number, social security number, driver's license number or credit card number to someone you don't know.

Visit for more detailed information on auction fraud and how to avoid it.

Remember - always watch for scams!



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