Internet Fraud

Internet fraud is a problem that has become very widespread in recent years. Internet fraud was first monitored by the Internet Fraud Watch organization in 1996. The Fraud Watch has stated that each year after its inception internet fraud has increased. In 1998, the Securities and Exchange Commission established the Office of Internet Enforcement to fight online securities fraud which was another sign of how large the problem is becoming (Clausing). Despite the SEC¡¦s efforts this problem has not been alleviated, but instead continues to grow. According to the Internet Fraud Complaint Center (IFCC), ¡§the total dollar loss from all referred internet fraud cases was $54 million in 2002; this amount is almost three times as much than was lost in 2001¡¨(IFCC). This increase shows that the problem of internet fraud is becoming more widespread. The most widely reported type of internet fraud by the IFCC is online auction fraud. In 2002, 46.1% of all internet fraud complaints were online auction related (IFCC). Because of how many people are affected by online auction fraud alone we decided to focus our study solely on this one type of fraud.

Why study online auction fraud?

Due to the large percentage of fraud that online auctions make up we have chosen to narrow our study to online auction fraud. The fact that online auction fraud is such a growing concern we would like to make people aware of several ways to avoid falling victim to one of the online auction scams. Also upon researching each type of online fraud we found that there was much more information about online auctions than any other type. The group then discussed that the type of online fraud that we have heard the most about and have the most experience with is online auction fraud. Each member of our group has in some way purchased merchandise from an online auction. In our experiences we have also fell victim to a form of online auction fraud. Jesse Zirillo attempted to purchase a