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Online auction firm puts systems in place to protect consumers.
The rising tide of Internet-based fraud is forcing online auction sites to redouble their efforts to protect consumers and the sites' business reputations.
At the eBay auction site, for example, the main problem is sellers who never deliver the goods they advertise for sale on eBay or substitute inferior goods.To combat the growing problem from such "fraudsters," as law enforcement likes to call them, eBay has put in place a slew of new online business practices.
Initially, eBay relied on "community policing," asking its users to report suspected fraud through a Web form. But as eBay has expanded its user base there are 700,000 registered eBay users in the U.S. alone - fraud has risen, too. So eBay is taking new measures.
"For one thing, the seller on eBay now has to supply eBay with a creditcard number," says Robert Chestnut, eBay's associate general counsel, who spoke on the fraud issue at the recent e-Gov conference. The online auction firm uses the card number to verify the seller's address.
In addition, eBay has...