Consumer Watchdog: Online alternative comes with risks

Maggie Lankshear trades off Facebook sites. Photo / Doug Sherring

Internet shoppers are turning their backs on Trade Me in favour of invitation-only groups on social media sites, but internet watchdogs are concerned they are becoming vulnerable to scams.

New Zealand-based Facebook group Walk In Wardrobe has gained more than 13,000 users since it started only a couple of months ago and has already spurned spin-offs dedicated to quality secondhand sportswear and home-made crafts.

Users post photos of items they are selling and interested buyers negotiate a price. There is no company behind the venture and no fees and the traders arrange payment and postage directly and without outside monitoring.

Retail manager Maggie Lankshear, 24, who enjoys Walk in Wardrobe and regularly buys and sells without any problems, says, "It's easier than Trade Me. I've posted things on the page and they've sold within five minutes. The person transferred the money straight away and I posted them that day."

Lankshear says she feels safe transferring money to other Facebook users because most operate under their full name and it is easy to determine mutual friends.

But NetSafe chief executive Martin Cocker considers it risky and says, "There are a lot of scammers who go to the trouble of creating detailed profiles and friend people before they enact their scam." He advises people to stick to lower-cost items or use cash-on-collection to avoid their money ending up in the hands of scammers.

Jon Duffy, head of trust and safety at Trade Me, says the site is very aware of trading activity on Facebook. "We're seeing a growing trend of fraudsters we're kicking off Trade Me going there to sell non-existent goods."

The activity has grown fast.

"The thing to remember is Trade Me is an auction website so it has the protections in place to make sure that integrity is maintained.

"Yep, Trade Me charges fees, we're a business. But with those fees you pay you get structures that have been developed over 12 years that protect your interests and stop you becoming a victim of scams."