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Avoid Scams on eBay

Use eBay's security measures to avoid falling prey to online scams.
Magazine Contributor
3 min read

This story appears in the December 2006 issue of Entrepreneur. Subscribe »

In the five or so minutes it will take you to read this article, nearly 100 people will become victims of identity fraud, with total losses of more than $600,000, according to a survey by Javelin Strategy & Research. A recent random test of eBay community members showed 11 percent fell for a typical spoof or phishing scam, which account for about 10 percent of all identity fraud cases each year.

As you're buying or selling goods on eBay, here are four tips for protecting yourself online.

1. Your eBay & PayPal passwords should be different. Each should have eight characters, varying four letters and four numbers (e.g., 4j2o1m9s).

2. Never open any e-mail from eBay or PayPal from your regular e-mail account. Always go to "My eBay," scroll down the left side and click "My Messages." If the e-mail really is from eBay, it will be duplicated there. For "real" PayPal messages, log in to your Paypal account. Any important information will be in the top left-hand corner of your main PayPal page.

3. If it sounds too good to be true, it probably is. Use your common sense when interacting online. Don't get caught up in the excitement of what seems like a great deal.

4. If you start a transaction on eBay, don't take it outside eBay. Always complete your transactions on eBay so you can take advantage of the protections eBay and PayPal provide, including PayPal's Seller Protection Policy and numerous Buyer Protection options.

Gold PowerSellers Troy Ylitalo, 41, and Sarah Linn, 54, of the eBay Store Period Paper, value the protection eBay provides for their Nashville, Tennessee-based online advertising art and antique art prints business.

A few months ago, Ylitalo wasn't able to log in to his account. "When you're a major seller, that's a little scary," he says. "I contacted eBay through their online support and was immediately called by a safety and security specialist. They had seen suspicious activity and froze our account until they could speak with us. That was the only time we needed their services in two years. I don't want to be in a marketplace where I need remedies and recourse, but rather, a marketplace where I have [the resources] but rarely need to use them."

Some of the specific security resources eBay provides include:

  • Security & resolution center: This is the portal page for reporting any security issue you have on eBay, including an Unpaid Item or spoof e-mail.
  • Spoof Tutorial: Are you getting e-mails that look like they're from eBay or PayPal? This tutorial reveals what they are, how to spot them and how to protect yourself.
  • Trust & Safety Discussion board: Participate in this eBay community forum to learn more about how to buy and sell safely online.
  • PayPal Security Center: Sign up for free Equifax credit alerts, get an online protection checklist, search a list of government agencies that provide assistance and more.

Janelle Elms, eBay University instructor and dean of eBay Business for L.A. College International, specializes in coaching individuals and companies to build successful eBay businesses and maximize their profits.

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