Shopping Online: Is it Safe?       
by Odin Wortman       

Attitudes have changed dramatically in the past six months. Surfers were saying they were not comfortable shopping online. Now they are saying they already have made a purchase or plan to soon. If you have a burning desire to order six dozen hand-carved Manahikian swizzle sticks on a Sunday night, you can. That's good news for online businesses and good news for the consumer as well. But these new frontiers tend to attract the riffraff. A few of the darkest Net alleyways are crammed full of shady characters most eager to abscond with your hard earned cash. 

For many people the biggest worry is security. Can the technology really be counted on to protect credit card information? In nearly all cases, yes. The most common secure Shopping online- Is it Safe?protocol uses Netscape's Secure Sockets Layer (SSL). SSL makes use of encryption technology that sends a digital certificate with a public key. The public key can only be decrypted with the corresponding private key. Depending on the level of encryption used--40 bit, 56 bit or 128 bit--breaking the code is either quite difficult, extremely difficult or next to impossible. Online credit card can, in fact, be sent directly to the credit card company and never viewed by the merchant. For these reasons, your credit card number is considerably better protected online than when used in a store, a restaurant or for phone orders. The most likely risks come not from decryption technology but from basic thievery and elaborate misdirection. 

Beware the Scam 

I am reminded of the memoirs of a long dead mobster. One of his favorite ``jobs'' was the time he wheeled a safe over to a bank after hours. Dressed in a crisp security officer's uniform, he hung an out of order sign over the night deposit slot. Then he placed an official looking sign on the safe instructing people to place their deposits through a slot on the top of the portable safe. No one challenged him nor did anyone decide against using the temporary night deposit slot. On the surface, the trick seems too obvious. How can a night deposit slot be out of order? But no one could see past the demonstrated signs of security--an official person in front of a respectable bank openly ``protecting'' their money from theft. That's classic misdirection. 

You might not be fooled by the obvious stuff: get rich quick business opportunities, prizes that you pay for, pyramid schemes. But if you think you're buying from a company you are familiar with or you are too focused on some other issues due to clever misdirection, you too can get taken. Here are some ways to avoid getting hornswoggled: 

Only deal with businesses you are familiar with and make sure they really are who you think they are by examining the URL (web address). A false front version of a legitimate store can easily be placed at another location and you can be tricked into going there from the same crook's fake directory or banner ad. A quick check on the URL eliminates that risk. 

Never respond to unsolicited e-mail, commonly known as spam. Remember, spammers are violating Net etiquette, they probably got your e-mail through illegal means, and they are generally known to be a lower life form. Don't deal with them. 

When making purchases, check the fine print for shipping dates, item numbers, product features, guarantees and warrantees. Save this information in a safe place in case there's a dispute later. 

Pay only via major credit card. Visa and MasterCard limit consumer liability to $50, and they usually waive that. Following this rule alone essentially guarantees that you won't take a significant personal loss with ordinary purchases. 

Verify that your connection is secure by watching for a pop up window in your browser stating you are entering a secure site. Then look for a closed lock or an unbroken key in the lower left corner on your browser. Understand, you are not looking for this icon in the browser window but on the browser itself. I know of a merchant who gets a fair number of credit card sales from a form that sends him the information via unencrypted e-mail. His customers happily enter their credit card numbers, and no one has ever even questioned it. Nevertheless, he is playing with fire. 

According to several sources, including the Federal Trade Commission and Internet Fraud Watch, here are the most common scams: 

The most popular scams these days involve auctions. The buyer gets caught up in the bidding process, comes away with a good price, but never receives the merchandise. Auction fraud makes up about half of the Internet fraud cases. 

Merchandise is paid for but never delivered. 

Charges for Internet services that were supposedly free. This figure may be under represented since many of the ``free'' subscription services are for pornographic sites, and consumers are usually too embarrassed to report an incident.

Shopping online may be new, but the laws governing commerce are well established. The same laws that apply to mail and telephone orders apply to online shopping. See the FTC web site for more details http://athttp://www.ftc.gov/bcp/conline/pubs/buying/mail.htm. For more information about Internet Fraud, see the FTC http://athttp://www.ftc.gov/bcp/menu-internet.htm or contact Internet Fraud Watch ( http://www.fraud.org ) at 1-800-876-7060.

Buyers are Satisfied

The vast majority of Internet shoppers are getting good products at good prices and receiving good service. Consumers and merchants alike have more options than ever before. And a recent survey shows consumer satisfaction with online purchases is high. So shop on. How else are you going to find those hand-carved Manahikian swizzle sticks?

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Odin Wortman is president of Internet Marketing Solutions, a firm that designs profit centered web sites and helps businesses use the web strategically. He can be reached at 410-799-9283, by e-mail at ask@IMarketingSolutions.com or on the web at http://www.IMarketingSolutions.com.