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Shopping safely online
5 Tips: How to shop securely online
March 15, 2004: 4:40 PM EST
By Gerri Willis, CNN/Money contributing columnist

NEW YORK (CNN/Money) - More and more Americans are skipping the mall and heading online to shop. In each of the next five years, sales via the web will grow at a 19 percent clip, says Forrester Research. By 2008, consumers will spend nearly $230 billion or 10 percent of all retail sales online.

So, as online shopping takes its place as an important part of consumers' lives, do we really know how safe it is to shop in cyberspace? Are you risking having your credit card number stolen, or worse, your identity?

Here are today's five tips to make sure you are cyber smart.

1. Shop with those you know.
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CNNfn's Gerri Willis has a few tips for those leery of online commerce.

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Make sure to shop with companies you are familiar with. Anyone can set up a shop online service under almost any name. If you are dealing with a reputable vendor, chances are good the company will take measures to protect your privacy. Make sure there is a privacy policy posted on the Web site and that you fully understand how your personal information will be used.

Next, ask yourself, will the seller be at the same web address tomorrow? The Better Business Bureau warns consumers to be wary if the seller's only contact information is a post office box. Another good source is Here Consumers Reports gives its e-ratings and Web site reviews of retailers.

If you're into online auctions, on eBay's site there is a feedback section, where buyers can comment on those they purchased from. Did they send the item in a timely fashion? Was the item in good condition? Sometimes listening to others is the best resource.

2. Be secure.

Before you send any private information over the Internet, make sure you are dealing with a secure Web site.

Many retailers use a technology known as SSL or Secure Sockets Layer. This encrypts credit card information sent through cyberspace. One interesting tip: if the web address on the page asking for your credit card information begins with "https:" instead of "http:" the technology is in place. Secure Electronic Transaction or SET is another option for securing a Web site.

Other signs that you are dealing with a secure Web site? Look for an icon of a locked padlock or an unbroken key at the bottom of the screen.

If you are still questioning the security, check out the privacy policy that we mentioned earlier. It's here that you will most likely find more information about the company's security technology. It also helps if the company has a seal of approval from a privacy enforcement organization such as the Better Business Bureau Online Reliability Seal. Visit for more information.

Besides the Better Business Bureau, you can also contact the FTC or your state attorney general's office to file a complaint.

3. Be particular with passwords.

The next step in securing your information is creating a password. When shopping online you may be asked to create a password before placing an order. The key here is not to choose a password based on your birth date, telephone number or Social Security number.

Try to get a bit more creative by scrambling up letters or numbers that someone cannot trace back to your personal information. Once you do shop, you'll want to get details like delivery dates, shipping and handling fees, warranties and return policies from the merchant's Web site. And print out a copy of your online order for your records.

4. Pay with plastic.

Paying with a credit card for online purchases is among the safest ways to go. Your transaction is protected by the Fair Credit Billing Act. This law gives you the right to dispute charges and to withhold payment until the problem is resolved by the creditor.
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If the card is stolen or used fraudulently, the consumer is typically liable for only a small portion of the amount -- usually no more than $50. The FTC says some companies even offer an online guarantee that ensures you will not be held responsible for any unauthorized charges made online.

Debit cards are another option consumers may choose. But be careful. The money from debit purchases is typically transferred immediately from your bank account to the merchant's. And your liability limits for unauthorized activity with a debit card are different from those for a credit card. With a debit card you can be held responsible from $50 to $500 or even more.

5. Watch for imitators.

One rapidly spreading scam is "phishing," the practice of fooling unsuspecting shoppers into giving away private information by sending e-mails that appear to come from legitimate sites.

The Better Business Bureau says be careful about responding to an e-mail or phone call from anyone who asks for your password. This also holds true if someone asks for your Social Security number, credit card number or bank account.

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The Bureau suggests verifying that person really does work for the company. One tip, call the company directly and ask to speak to that person. You want to be suspicious if you are asked to provide information you usually wouldn't be asked for when making a purchase.

For example, do you need to give your Social Security number when you buy something in a store? Usually not. Therefore, if the merchant requests your Social Security number and personal bank information, decline. And never volunteer answers for optional questions. Only offer what is needed to complete the deal.

Gerri Willis is a personal finance editor for CNN Business News. Willis also is co-host of CNNfn's The FlipSide, weekdays from 11 a.m. to 12:30 p.m. (ET). E-mail comments to  Top of page

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