Are there any scams I should watch out for when buying online?
Internet and telephone vendors use a variety of techniques to try to take advantage of the unwary customer. You can protect yourself by taking these steps:
Understand gray-market goods. Sometimes vendors will sell goods that were not manufactured or intended for sale in the United States. These products, sometimes called gray-market goods, have found their way to the United States through a circuitous route. Gray-market vendors will happily sell them to you at an often substantial discount. Many of the so-called gray-market goods are made by well-known manufacturers, arrive in excellent condition, and work perfectly fine. On the other hand, gray-market goods may also arrive without a set of instructions in English. More important, they will almost definitely arrive without a U.S. warranty. The absence of a U.S. warranty means that if something fails, you have to find a repair center and pay to repair or replace it. Buying gray-market goods is a bit like rolling the dice in Las Vegas.
Beware of the "U.S. warranty" scam. Some vendors, particularly in the consumer electronics area, anticipating that a customer will know enough to ask for a U.S. warranty, sell gray-market goods with a third-party warranty contract provided by a U.S.-based repair or warranty service. Since the third-party warranty comes from a United States firm, the vendor will, "truthfully," tell you that they will sell the item to you with a U.S. warranty. These third-party warranties often do not match the breadth of coverage of the manufacturer's warranty. Unless you feel like gambling when you order, be clear that you want goods with the manufacturer's U.S. warranty, not gray-market goods.
Watch out for the shipping charges scam. Some discount vendors will quote you a very favorable price for the item of your choice. While you are congratulating yourself on the great deal you just made, the vendor will then recover some of the profit discounted out by adding an excessive amount for shipping and handling--say $60 or $75 when the true cost should be $20 or $30. Consider the cost of shipping a part of the acquisition cost when comparing prices among vendors.
Turn down service contracts. Often, you will have the opportunity to purchase a vendor or third-party extended-service contract for consumer electronics items to supplement the manufacturer's warranty. Distinguish these from extended warranties from the manufacturer. They are either a store arrangement or a third-party warranty package. Generally, the service contract or extended warranty costs 10 to 30 percent of the cost of the item, depending upon its scope and term and which vendor offers it. The primary purpose of these contracts appears to be creating an opportunity for the vendor to make a few extra dollars. These extended warranty packages often do not represent a good value, and you probably should forgo the "opportunity."If you detect any scam, report it to the Internet service provider (ISP), in the hope that the scammer's e-mail account will be closed.
Copyright © 2004 American Bar Association