How? By developing national databases listing both known con artists and historically safe, reputable businesses that operate online.
These listings are to help Internet users make wise transactions, said Michele McDaniel, president of the Better Business Bureau of North Alabama.
Since starting the national databases, the BBB has recognized three Huntsville businesses for sound, ethical policies related to online commerce. Those companies are Traveller Information Services, Renaissance Internet Services and Rousseau's Sporting Goods & Awards Inc.
The three companies are now allowed to display BBB seals of approval on corporate World Wide Web pages. The seals include computerized links to BBB reports about the companies' backgrounds.
If an unapproved company tries to forge the BBB seal, it will not link to the proper report at BBBOnLine, at the Web address http://www.bbbonline.org.
To get the BBB seal of approval, a business must:
``All companies share an interest in demonstrating to consumers, regulatory authorities and the public that the business community can effectively self-regulate this (online) marketplace,'' according to a BBBOnLine brochure. ``Self-regulation and minimum government intrusion are the spirit of the Internet.''
Consumer-protection laws drafted long before the Internet was popular already protect consumers from most scams they could meet online, said Claudia Farrell, senior spokeswoman for the Federal Trade Commission.
In general, con artists use the same tricks and gimmicks online that have worked in the physical world for ages.
On the FTC's World Wide Web site (http://www.ftc.gov), government watchdogs list tell-tale signs of investment frauds, phony charities, quack diets, scholarship scams, bogus offerings of prizes and vacations, and fake opportunities for foreign employment.
And, of course, the BBB and FTC offer plenty of information on Ponzi or pyramid schemes. Those are multilevel-marketing businesses in which promoters use money from new investors to pay artificially high returns to early investors. In such schemes, more emphasis is placed on recruiting investors than selling products or services. So, as soon as investors dry up, almost everyone loses money.
``The Net seems more susceptible to those types of scams,'' said Steven Baker, director of the FTC office in Chicago. ``To make these schemes work, you need to recruit lots of people. You can reach more people faster online.''
Contacting legions of people is cheap and easy using bulk electronic mailings, Baker said. However, many consumers are annoyed by unsolicited, commercial e-mail, derisively called ``Spam.'' Congress is debating at least three bills to regulate such mailings, regardless of honest or dishonest contents.
Pyramid schemes also are promoted on World Wide Web pages. After a recent Internet search, the FTC contacted operators of 500 multilevel-marketing sites that raised suspicions.
The Web site for the U.S. Securities and Exchange Commission lists
10 questions every consumer should ask before making an investment online
or elsewhere. Among the questions listed at http://www.sec.gov/consumer/10quest.htm:
The Better Business Bureau of North Alabama is accessible through its aforementioned Web page, through the e-mail address email@example.com, or via phone at (205) 533-1640.
The SEC is available through the Web address http://www.sec.gov, or (202) 942-7040.
The National Fraud Information Center is accessible through the
Web address http://www.fraud.org, or
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