Online shopping

Internet auctions

The distance selling regulations do not cover transactions effected at an auction. Therefore, it is important to be aware that when buying from an internet auction, your transaction is not covered by distance selling provisions.

Another factor to keep in mind is that very often at internet auction sites you are dealing with a private individual rather than a company. This will reduce your rights considerably, since both the seller and the buyer will be acting in a private capacity and the transaction is not regulated by consumer legislation.

Escrow companies

The role of an escrow company is to act as an intermediary between buyer and seller. The procedure is that the buyer will send the money and the seller will send the goods to the escrow company when the contract is entered into between the parties. The escrow company will then release the goods to the buyer and the money to the seller when both money and goods are received.

Before using an escrow company, make sure that the company is specifically recommended and endorsed by the auction site.

Online scams

Various kinds of online scams exist, varying from the winning of lotteries and prizes to investment schemes. There are however factors which may help you identify a scam, namely:

• Being contacted about the winning of a lottery/prize without having entered into a draw/competition;

• The offer sounds too good to be true;

• You are asked for money to release a prize;

• You are asked for account numbers, passwords or other confidential information through e-mail;

• You are urged to reply to the unsolicited communication straight away, or imposing a deadline to claim your prize;

• You are asked not to talk to anyone about the offer;

The article will continue next week with more information on scams you might have come across or heard of.