Online auctions consistently top the lists of consumer complaints to New York State and U.S. law enforcement agencies. Yet millions of people around the world buy and sell goods online through auction Web sites such as eBay and UBid without a problem. And many of them find goods that are hard to come by anywhere else, sometimes at a great bargain. Getting the most out of an online auction requires advance preparation. Here are some tips to help you get started.

1. Think of an online auction like a flea market and an auction Web site as the building in which the market takes place. Online auction sites are venues for transactions, and so, the responsibility is on the buyer and the seller to engage in a transaction both are happy with.

2. Winning an auction is something like a contract, binding both buyer and seller with some rules. In a timely fashion, you should receive the merchandise you paid for, and the buyer should receive payment.

3. Take time to learn about the merchandise you are planning to buy. Ask yourself some basic questions before getting involved in an auction: Am I OK with a used leather jacket, or do I want a new one? (Both new and used goods are available on auction sites, from individual sellers to chain retailers).

4. Consider how you are going to make a purchase. Many sellers accept direct payment via a service such as PayPal (which is owned by online auction giant eBay) or BidPay. Many buyers won’t do business with sellers who do not accept such payment services. If a buyer won’t accept your preferred method of payment, don’t do business with that buyer.

5. Are you buying a big-ticket item? You may be tempted to use an escrow service, a third party which holds on to your money while you and the seller make an arrangement to inspect the goods on offer. The trouble with escrow sites, which have sprung up by the thousands to cater to nervous online buyers of pricy goods such as automobiles, is that the vast majority are fraudulent, according to the U.S. Federal Trade Commission (FTC). In early 2003, about 10 fake escrow sites surfaced each month, while the rate climbed to 25 a month by year’s end. One legitimate service, Escrow.com, says it gets reports of six times that number, many of them with graphics and logos stolen from its own site.

See our other online auction fraud fact sheets for more information about scams before, during and after an auction.

Keep up to date on all types of online fraud, and ways to prevent it. Bookmark Consumer Reports WebWatch: http://www.consumerwebwatch.org