Consumer Reports WebWatch Survey: More Than 25 Percent Of New Yorkers Stung In Online Auction Site Scams

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‘Look Before You Click,’ Says Consumer Reports WebWatch in New Campaign

YONKERS, NY, October 1, 2008 — Online auction fraud ranks first among the types of complaints New York state consumers make about the Internet to state and federal officials. According to a recent statewide survey by Consumer Reports WebWatch, the Internet integrity division of Consumers Union, the nonprofit publisher of Consumer Reports magazine, 27 percent of New York state residents who have ever used an online auction Web site, such as eBay or Amazon, have experienced a scam or deceptive practice — 32 percent of eBay users were scammed.

The survey, which focuses on online fraud, was commissioned by Consumer Reports WebWatch, which evaluates the credibility of Web sites and advocates for consumer-focused Internet policy and governance. The full report is part of Consumer Reports’ free Online Security Guide, which has launched to coincide with National CyberSecurity Awareness Month.

Common Complaints of Online Auction Users
Eleven percent of users of online auction sites reported that they never received the goods they bid on, making it the most common complaint. Additionally, seven percent of survey respondents who received their goods said that they were not in usable condition. Other complaints included not being told a key detail about the item before it arrived (7 percent) and being sent an item of lesser value than the one they actually bid on and won (7 percent).

“Online auctions are great for bargains, quirky merchandise and collectibles, but you need to know what you are doing,” said Beau Brendler, director of Consumer Reports WebWatch. “Con artists, ripoff specialists and sophisticated criminals can catch you at every step of the process, from bidding to payment to shipment.”

“Using online auction sites is just one of the many ways that consumers can get stung online,” said Jeff Fox, Technology Editor, Consumer Reports. “Our free Online Security Guide offers consumers tips, tricks, and advice for protecting themselves from a variety of Internet threats – there’s even a new animated video and an interactive quiz to teach consumers about email scams.”

Other survey highlights include:

Online Auction Sites New Yorkers Use the Most
• Survey respondents who reported using a online auction sites including used the following sites the most – eBay (52 percent), Amazon (45 percent) and Overstock (21 percent).

Doing Research
• Almost 40 percent of online fraud victims said that because they have experienced by some type of auction fraud, they would do more research on sellers before bidding. Despite the sometimes risky nature of online auctions, 57 percent of those who have used them said they did not read any information about online auction fraud before placing a bid.

Avoiding Online Auction Sites
• Only 12 percent of victims said they would stop bidding on auction sites altogether as a result of their experience with online auction fraud.

• About 20 percent of victims said they would no longer buy certain types of products on auction sites. Among age groups 1824 and 2534, the number was even higher – 31 percent.

Solving Problems
• When confronted with some kind of fraud, more than 50 percent in most age groups said they tried to resolve the problem directly with the seller.

• About 40 percent said they filed a formal complaint with PayPal, the online payment service owned by eBay.

• More than 25 percent left negative feedback for the seller.

• In general, few chose to contact law enforcement, a lawyer, or the U.S. Federal Trade Commission.

For additional information on Internet threats and how consumers can protect themselves online visit the Online Security Guide, which features a new musical video commissioned by WebWatch called Gone Phishing , developed to educate consumers about the dangers of email phishing scams. The site also features an interactive tool “Phishing Trip” that lets consumers test their ability to recognize email scams. Additionally, Consumer Reports WebWatch will be releasing more results from its statewide survey, covering phishing, spyware and other issues. Read more on Consumer Reports WebWatch’s “Look Before You Click” campaign to help New York State consumers to combat online fraud here.

Poll Methodology
The survey was commissioned by Consumer Reports WebWatch, designed by the Consumer Reports National Research Center and conducted with a sample of 2,008 panelists representative of the geographic population distribution of New York State. Eligible respondents had been using the Internet for more than a year and owned a home computer for at least six months. The sample was representative of New York State residents who had been online for at least a year and is not nationally representative. The results may differ for a sample of less experienced users.

About Consumer Reports WebWatch
Consumer Reports WebWatch is the Internet integrity division of Consumers Union, the nonprofit publisher of Consumer Reports Magazine, the Consumer Reports on Health and Money Adviser newsletters, and a variety of sites advocating consumer rights in the marketplace. We research and investigate Web sites on behalf of consumers, and we advocate for consumerfocused Internet policy and governance. Consumer Reports WebWatch accepts no advertising. Consumer Reports WebWatch is a member of the Internet Society, a grassroots group focused on Internet policy; and is an atlarge structure (ALS) in the user community of ICANN, the Internet Corporation for Assigning Names and Numbers. WebWatch also serves as an unpaid special adviser to StopBadware.org, a “Neighborhood Watch” initiative led by Harvard University’s Berkman Center and the Oxford Internet Institute devoted to helping Internet users avoid downloading malicious spyware, adware and malware programs. With the Center for Media and Democracy, WebWatch publishes Full Frontal Scrutiny, dedicated to exposing the activities of front groups in modern media and culture.