E-auctions take a hammering

Nearly half of all internet fraud cases involve online auctions, according to a US report.

The Internet Fraud Complaint Center said it logged 49,711 complaints ranging from fraud to computer intrusions, hacking and child pornography.

The centre, which is a partnership between the FBI and the National White Collar Crime Center, said that auction crime has been identified as the primary source of disputes and web fraud.

Nearly a quarter of the auction complaints were about non-delivered merchandise and non-payments.

eBay, the largest online auction site, has changed its privacy policy and now warns customers about users who have been suspended for fraud.

It also shares information about alleged fraud with law enforcement agencies, which is believed to be the main reason for the high level of fraud reported to the agencies.

The next biggest scam is the so-called 'Nigerian letter' where victims are promised large sums of money in return for bank details.

This fraud was responsible for more than 15 per cent of complaints and cost the victims on average $5,575.

Other frauds included identity theft, which cost victims an average $3,000, and investment frauds, which cost an average $1,000.