Online shopping is nearing fever pitch as Christmas approaches. 'Tis the season for shoppers to get saddled with mystery charges on their credit card, delivery no-shows and bait-and-switch sales techniques.
So, to maximise your chances of a trouble-free December, take a look at our top 10 tips for staying safe and secure while shopping on the web.
It's sometimes hard to tell a reputable site from a fly-by-night online store.
One basic way to assess whether a site is trustworthy and secure is to look for a padlock icon in the locked position in the lower right hand corner of your browser window. This padlock indicates the site uses encryption technology to transfer information from your computer to the online merchant's computer.
Another way to check whether a site is secure is checking the address field of the web browser to make sure the site uses the https:// prefix. The 's' that is displayed after 'http' indicates the website is secure.
Often, you do not see the 's' or a locked padlock until you actually move to the order page on the website. And of course, it doesn't matter how secure a site is if it's run by an unscrupulous company. To verify the site you are shopping at is in good standing with customers, check out the company's reputation with the Better Business Bureau's site.
Remember: never send your credit card or bank account number via email (if you must, break it up into two messages), and don't give out passwords, PINs or the name of your bank.
Scrutinise a site's credentials
Sites often suggest they are reliable by displaying credentials from third-party ratings firms in the form of icons and seals of approval. Make sure seals, such as those for the BBB, Truste and Bizrate.com, actually link to the sponsoring organisation. For example, clicking the BBB seal should take you to its merchant reports.
Also make sure the specific credential means something. A site we recently browsed prominently listed a MasterCard SecureCode logo under a section of the site called 'credentials'. MasterCard SecureCode is a programme to protect the online merchant from fraudulent charges and doesn't mean anything for the online buyer.
Beware of bait-and-switch ploys
It's an age-old trick. A store advertises a great price for a product and then claims to have sold out of it when you want to buy it.
A salesperson participating in bait and switch will try high-pressure sales techniques to get you to buy a similar but different product – at a higher price.
Online, vendors sometimes will advertise a low price for something like a digital camera and then try to persuade you to buy accessories you probably don't want or need as a way to jack up the price.
Tell the seller to buzz off if they try this sneaky sales technique.
Pricing engines don't always deliver the 'best deals'
Pricing engines such as Froogle are adept at directing you to the cheapest price of a given product. But often the best price isn't the best deal.
Low-priced merchandise might be a lure to a scam where a site takes your money and delivers you nothing. Recently the New Jersey State Police made arrests involving scams of this kind. Items advertised for sale on eBay but never delivered included Xboxes, designer handbags, laptop computers and Rolex watches, the police said.
And ridiculously low prices should be a red flag that what you are buying might be counterfeit. According to investigators at Kessler International, the most popular phoney items sold are designer accessories and apparel such as purses, watches, wallets, sunglasses and jeans.
But tech products aren't immune. When buying a standalone software package, for instance, ask the vendor if the software is used, promotional, intended for another country (grey market), shareware, burned onto a CD-R, missing manuals or an old version. If you're buying a PC, make sure it includes the original CD-ROMs and licences for all preloaded software. If the vendor hesitates, walk away.
Best ways to pay
If you're offered a choice of paying with a credit card, PayPal or your debit card, go for the credit card. Do not use debit cards; they're not well protected as credit cards.
And if you pay a merchant with the popular escrow service PayPal and get ripped off, you have fewer resources for help than you would if you paid with your credit card. PayPal says it will investigate any complaint you make against a seller and will make "a best effort" to resolve your complaint but "cannot guarantee funds recovery".
Be skeptical of vendor reviews
Besides a BBB report, vendor reviews are one of the only things consumers have to judge an online merchant's reliability. Site reviews are offered through links at shopping engines such as PriceGrabber.com and at sites such as Epinions.com.
PriceGrabber and Epinions do a great job of policing their user reviews and weeding out fraudulent ratings. However, the internet is rife with tales of other price engines and consumer ratings sites that have been targeted by cheats. To make themselves look good, online merchants abuse ratings sites by submitting positive reviews for transactions involving them that never actually took place.
Get a sense of how trustworthy the reviewers themselves are by looking at the number of reviews each has posted and who else trusts their judgment.
Watch those shipping charges. One way sellers have been known to make money on low-cost sales prices is by charging you an arm and a leg for shipping and insurance. Also be aware 'free-shipping' offers often don't apply to bulky big items.
Another example: when searching on Amazon for an item, the firm typically delivers a 'Used & new' link next to its advertised price. That price is from a third party and is sometimes cheaper than Amazon's original price. But note that Amazon's longstanding free-shipping perks don't apply to these third-party merchants. The non-Amazon price may be better, but often only before shipping costs are calculated.
Read the warranty
Before you buy that discounted flat-panel TV, find out what the product warranty covers, how long the coverage lasts, and where you have to send the product to obtain repairs, a refund, or replacement.
File your complaint with ratings Epinions, Complaints.com, Epubliceye.com, Resellerratings.com and RipoffReport.com. You can also review the site in question at pricing engines PriceGrabber and Bizrate.com.
These sites won't get your money back. But by sharing your story with others, hopefully you'll help others steer clear of a bad merchant.