SCAMS PUT ON-LINE BIDDERS AT HIGH RISK
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NEW YORK When Sotheby's sold a Harry S Truman signature that turned out to be a reproduction, the prestigious auction house apologized and bought it back. On the explosive frontier of Internet auctions, the policy is different: bidder beware.
Toy collector Christina Platthy says she found out too late _ after paying $1,815 for a rare Beanie Baby she bought in an eBay Web site auction and getting a $5 stuffed duck instead.
The rapid, raucous popularity of Internet auction houses has left consumers prey to scams and emerging companies such as eBay struggling to prevent a new kind of fraud.
The company, founded in 1995 by Pierre Omidyar in San Jose, Calif., to sell his girlfriend's Pez dispensers, is the most famous of the on-line auctioneers, but it has no less than 1,500 rivals.
Auction houses say they can't be forced to protect consumers against bogus buys, any more than a newspaper can be held responsible for the claims of its classified advertisers.
"I think from a legal point of view we have no liability," said eBay CEO Meg Whitman. However, she added, "We actually have a significant responsibility to make eBay as safe a site as possible to trade on. We also need to communicate that users have a responsibility as well."
But, many users report their problems elsewhere. The National Consumers League gets 600 complaints a month about Internet fraud. Two out of three are auction fraud cases.
As the largest auction house, eBay has had its share of mishaps.
Pennsylvanian Jamison Piatt was turned in by angry buyers who never got the Furby toys he promised. He's agreed to repay them $3,600.
Bidders aren't always honest either. Some offered up to $200,000 for a "Today" show jacket signed by host Katie Couric. After bogus bids were ferreted out, the jacket sold for $11,400. Starting next month, deadbeat bidders will be suspended from eBay.
The problems may stem in part from the industry's stratospheric growth.
Market researcher Jupiter Communications estimates that the number of Internet auction customers will jump nearly sixfold from 1.2 million to 6.5 million by 2000, when they will spend about $7.1 billion. For eBay, sales grew 724 percent in 1998, to $47.4 million.
As the industry grows, so does fraud. Scams are prevalent enough that Manhattan attorney Brian Brokate has a full-time staff tracking on-line knockoffs of luxury goods made by clients such as Rolex and Vuitton.
New York City is trying to hold on-line auction houses accountable. The city's Department of Consumer Affairs said last week it is looking into whether some eBay sellers are falsely labeling baseballs supposedly signed by such legends as Babe Ruth and Roberto Clemente, as "one of a kind."
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