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Consumer Scam Warnings About Selling on eBay

By Brett Goldfarb in Consumer Advocacy, Special Reports
December 1st, 2011

Thinking about selling that awful sweater you got as a gift from your great aunt on eBay? Before you do, you might want to read this article and think twice before you sell anything on eBay.

ebay scamHoliday times are here and it’s a given everyone is going to get a gift or two you simply don’t want or can’t use. In the past, it was common to stuff that unwanted gift in a closet, re-gift it to someone else or return it for a refund.

These days, more and more people turn to eBay as an alternative to get rid of that dust collector and put a little cash in the pocket, but best be warned : selling on eBay can be VERY treacherous.

eBay can be a great place to find a potential buyer interested in your unwanted gift but there are numerous pitfalls novice sellers can easily fall into when selling on eBay. Most of these potential problems are due to eBay policies that provide loopholes for crooks to use the eBay Buyer Protection system to their advantage.

eBay also takes up to 15% of your sale price in fees and force sellers to use Paypal for an additional 4% transaction fees. When all is said and done, eBay will pocket nearly 20% of your item’s price for selling in their marketplace that is littered with crooks, scammers and fraudsters. All with zero customer support for sellers.

We spoke to several veteran eBay sellers and they were quick to offer these 7 warnings for casual or novice eBay sellers to avoid potential buyer fraud.

Never Sell Anything on eBay You Can’t Afford to Lose

The eBay sellers we spoke to all were very clear about the fact that you should never sell anything you can’t afford to lose on eBay. In the last year, there have been hundreds of reports of eBay buyers using eBay’s Buyer Protection to scam sellers out of high priced designer items such as Chanel and Louis Vuitton purses by simply claiming the item was not authentic or by pulling a switch and returning a fake item.

Always Ship With Delivery Confirmation

If you’re going to ship anything to an eBay buyer, always, always, always purchase some form of online viewable delivery comfirmation. Without DC, a malicious buyer can simply file an Item Not Received claim and eBay/Paypal will grant them an automatic refund from your bank account or credit card. It is important to note that delivery confirmation is not available for international shipping unless you ship using USPS Express Mail International which is very expensive.

Purchase Signature Confirmation on Orders Over $250

This is another loophole eBay does not inform sellers about but can really come back to bite you in the arse. Any order over $250 (this includes shipping costs) MUST be shipped with signature confirmation in order to qualify for seller protection. There are far too many horror stories from novice sellers who shipped expensive items only to have them stolen by buyers who claimed they didn’t receive it. Again, eBay/Paypal will refund the buyer from your bank account or credit card on file.

Be Prepared for Paypal to Hold Your Funds for 21 Days

Here’s another gotcha that eBay isn’t up front about. All new sellers or sellers not meeting eBay’s secret criteria will be subject to having the funds from their buyers payment held for 21 days by Paypal. This means if you sell a $2000 stereo system on eBay that costs $50 to ship, you will have to pay for the shipping out of pocket and wait for Paypal to release your funds when they see fit.

Beware of Scam Artists Seeking Partial Refunds

Newer sellers with a low feedback score can be assured they will encounter the buyer who complains about the item they were sold but doesn’t want to return it and wants a partial refund. Don’t fall for this scam. This scam is perpetuated by eBay sellers using multiple eBay ID’s (yes, believe it or not, eBay allows people to have more than one ID) who buy on one and sell on another. Never give a partial refund to a buyer for any reason. If they don’t like what you sold them, have them return it for a full refund.

Always Ship to Address on File With Paypal

Another common eBay scam is when a buyer targets a new seller and asks them to ship the item they purchased or won to an address other than the address on file with eBay. If you ship to an address other than the one Ebay/Paypal provides for the transaction, it completely voids your seller protection.

Be Prepared to Accept Returns for 45 Days

No matter what you’re selling on eBay and no matter what you state as a return policy in your listing, eBay will FORCE you to accept returns and issue refunds for 45 days after purchase. This policy is widely abused considering the possibilities for buyers to buy and use an item, then return it at the seller’s expense. Considering Walmart, Best Buy and other retailers no longer accept returns of unsealed CD’s, DVD’s, video games ~ eBay has become the perfect place for people to buy, copy and return.

As you can see from the information provided above, selling on eBay is like tap dancing in a minefield. In most cases, especially where larger, higher priced items are concerned, it’s always best to use an alternative like Craigslist or the newspaper.



5 Tips for Protecting Against Consumer Fraud

By Martin Harris in Consumer Advocacy
September 13th, 2011

In this fast paced modern world, it’s become critical for all consumers to be aware of and follow several basic precautions in order to protect against becoming the victim of potential fraud.

consumer protectionNobody likes the feeling of being ripped off. While the initial sting can be devastating, the lasting effects from being taken advantage of can cause many sleepless nights. In cases of identity theft, a consumer could possibly face years or even decades of problems arising from the financial entanglements caused from having personal information compromised.

Fortunately, there are precautions you can take as a consumer to avoid common scams and the headaches that come from being a victim. Armed with a little bit of common sense and the tips below, the risk of falling victim are sgnificantly decreased.

#1 : Do Your Due Diligence
As a consumer, one of the most important things you can do is research new and untrusted companies before you begin business with them. This is especially true of internet based companies and absolutely critical before making any type of investment. More often than not, a simple Google search can save you a lot of future headaches and heartaches.

#2 : Monitor Your Credit Report and Banking Statements
With identity theft on the rise, these days, it’s more important than ever to watch your personal information more closely than ever. You don’t have to use a third party monitoring agency such as Lifelock because all of the resources necessary are availabe to consumers for free if you know where to look and are proactive.

#3 : Make Yourself Aware of Consumer Laws and Rgulation
While you don’t have to become an expert, it’s important to at least glance and read the FTC’s studies about consumer fraud to help protect yourself. As stated on their site, “education is the best defense”

#4 : If It Seems Too Good To Be True, It Probably Is
While this seems like such an old adage, in today’s world, the saying is more true than ever. If you really believe you’re going to get that $700 iPad you want for $49.95 or get something for nothing, just remember what P.T Barnum said. “A sucker is born every minute” and that’s the motto con-men and scammers rely on to fleece people of their hard earned cash

#5 : Keep All Documentation of Transactions as Evidence
As an educated consumer, it’s imperative to keep receipts, records and anything else that might pertain to significant transactions to protect yourself against fraud. Don’t be the chump who throws away receipts when all it costs you to keep them is a shoebox. Should you find yourself in a sticky situation with the burden of proof resting on your shoulders, it can only help to have accurate documentation. Legitimate businesses will be more than happy to offer you receipts or documentation when doing business with them.



Consumer Advocacy in the United States

By Candice Taylor in Consumer Advocacy
September 4th, 2011

US Consumers are protected by several governmental agencies who regulate business ethics in the United States. It is YOUR right to file a complaint if you feel that you have been wronged

consumersEach year and every year, millions of Americans fall victim to dishonest merchants, poorly operated service providers and predatory investment schemes. The losses to consumers total in the billions of dollars and often times consumers believe that there is no recourse outside of costly legal action to recover lost money from the business or person who defrauded them.

In the United States, consumer protection laws were created to facilitate fair trade competition and the free flow of truthful information to consumers.

There are several government appointed agencies who regulate various sectors in which businesses operate in. Any business operating legally in the United States must conform to the standards set forth by these agencies and should a business fail to do so, they can be warned to improve, fined or have legal action taken against them.

It is of the utmost importance that when consumers feel they have been wronged by a business entity, that they file a complaint with the specific agency governing the practices and actions of the business in question.

In this article, I will try to bring together the different agencies in one place where consumers can find an appropriate legislative body to file a compliant in case they were defrauded.

The Federal Trade Commission (FTC)
Protecting Consumers Against False Advertising

FTC LogoThe Federal Trade Commission, also known as the FTC, is an independent agency of the United States government with the main goal being to protect US consumers and businesses by investigating specific concerns raised by reports from consumers and businesses, congressional inquiries, pre-merger notification filings, and/or reports in the media.

The Federal Trade Commission was established in 1914 during the Presidency of Woodrow Wilson under the Federal Trade Commission Act. The main purpose at the time was to deal with anti-trust issues and to enforce the provisions of the Clayton Act.

Since it’s formation, the FTC’s duties have expanded to encompass the “Truth in Advertising” act which protects consumers against false advertising. Since the popularity of the internet and the rise of unscrupulous internet marketing, this currently the most active arm of the FTC.

Contact Information
Website : http://www.ftc.gov
Complaint Form : https://www.ftccomplaintassistant.gov
Phone : 1-877-FTC-HELP (1-877-382-4357)
TTY: 1-866-653-4261

Securities Exchange Commission (SEC)
Protecting Consumers Against Investment Fraud

SEC LogoNot to be confused with the NCAA conference bearing the same acronym, The Securities Exchange Commission, also known as the SEC, is the governing body for enforcing securities laws and protecting consumers against fraudulent investments in the United States.

The SEC, as we know it, was established in 1934, during the Great Depression following the Stock Market Crash of 1929, to regulate the stock market and prevent corporate abuse. It was founded by Congress as a means to provide an independent agency that would overlook the sale of stock and to ensure coporate reporting was not falsified.

The SEC is the regulatory body who pinched Bernie Madoff and Lou Pearlman for their ponzi scheme investments. The SEC also brought down corporate giants ENRON and WorldCom for their fraudulent accounting practices..

If you feel you have been the victim of a securities or investment fraud, you are urged to contact the SEC and file a complaint.

Contact Information
Website : http://www.sec.gov
Complaint Center : http://www.sec.gov/complaint/select.shtml
Other Contact : http://www.sec.gov/contact.shtml

Food and Drug Administration (FDA)
Protecting Consumers Health

FDA LogoThe Food and Drug Administration, also know as the FDA, is a consumer protection organization that deals with issues specific to food safety, dietary supplements, prescription and over-the-counter medications, vaccines, medical devices, veterinary products and cosmetics.

The FDA falls under the Department of Health and Human Services which is a federal executive department. The agency was created under President Theodore Roosevelt in 1906 when he signed into law the Food and Drug Act .

Prior to Roosevelt signing the act into effect, there was no federal regulation on food products or pharmaceuticals in the United States. In the 1930’s the FDA’s role was increased due to outcry for even more stringent regulation of consumer goods due to complaints about cosmetics and other products that were causing fatalities.

In 1938, President Franklin Delano Roosevelt signed the new, updated Food, Drug, and Cosmetic Act into law which provided a wider scope for the agency.

Contact Information
Food and Drug Administration
10903 New Hampshire Ave
Silver Spring, MD 20993-0002

Website : http://www.fda.gov
Phone: 1-888-INFO-FDA (1-888-463-6332)

Occupational Safety and Health Administration (OSHA)
Ensuring Safety in the Workplace

OSHA LogoThe Occupational Safety and Health Administration, also known as OSHA is the primary federal agency in charge of the enforcement of safety and health practices. The agency falls under the United States Department of Labor.

OSHA was created in 1970 by Congress under the Occupational Safety and Health Act and was signed into being by President Richard M. Nixon.

OSHA covers safety issues for workers in most private sector workplaces. Some of the changes OSHA has brought about are to make the modern workplace safer by providing adequate protection against dangerous or potentially fatal workplace environments.

Contact Information
U.S. Department of Labor
Occupational Safety & Health Administration
200 Constitution Avenue
Washington, D.C. 20210

Website : http://www.osha.gov
Phone : 1-800-321-OSHA (6742) Toll Free U.S.

Always remember, that as a US consumer you are protected and that while filing a consumer complaint against a fraudulent business, employer or merchant might not solve your situation with them, your report just might save the next poor victim down the road.


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