Internet auction fraud, according to the Consumer Sentinel, the FTC consumer fraud’s database, was the most commonly related computer fraud issue within their database. The reports show that about 12 percent of the 431,000 computer related fraud complaints last year resulted from online auction fraud.

Online auction fraud is when a seller from an auction site either doesn’t deliver goods or sells a flawed product. Sites like Ebay, usually have a means to warn their buyers if a particular seller has created a bad experience for one of its buyers. This giant auction site has a rating system that rates every single seller. A high rating, usually demonstrates a very good and reliable seller. But researchers from Carnegie Mellon University claim that savvy fraudsters conduct a lot of transactions with their friends and use alternate names in order to secure high satisfaction ratings. This deception causes many innocent buyers to get ensnared by fraudulent sellers.

To counteract this deception, the CMU research team has developed an anti-fraud software for online auction sites. This software is a statistical software that recognizes certain patterns of improper buying and selling between buyers and sellers. If the software recognizes too many repeat dealings between a certain seller and buyer, the software will alert the user that the particular seller has a higher probability of being fraudulent. Thus, the software functions as an extra precautionary tool.

This is just another great breakthrough in the fight against online fraud and identity theft.

Tags: online auction, CMU, online fraud, ebay, internet auction, internet fraud, Carnegie Mellon University, software, anti-fraud, anti fraud

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This entry was posted on Thursday, December 14th, 2006 at 7:38 pm and is filed under Internet Fraud. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.