Sunday, September 21, 2008

Caution is Needed When Purchasing Higher End Items.

Classic 1968 Cadillac DeVille Convertible is available through 31 Gallery & Mareketplace.

One goal we have at the 31 Club is to help our members move up to buying and selling in the higher end of the market, where the real profit is. This shouldn’t be done without caution. When you’re first starting out in this business and purchasing in the lower end of the market, you might come across items that are beyond your budget or knowledge. Using the Associates Program for these types of purchases will keep you from having to make buying decisions on higher priced items, yet still enable you to benefit monetarily.

This is important because, the more expensive and desirable an items is, the greater the chance of there being fakes on the market. Large amounts of money can be made in a very short period of time when the sale of a fake is completed. So, it’s important to know how to protect yourself when you’re buying in the higher end of the market.
Buying from the Internet requires extra precautions be taken, not just against fakes, but against those who would take your money and not deliver the goods.

The story of a man who bought a vintage Jaguar from the Internet illustrates some of the dangers you might face. You see, after calling the Jaguar seller at the number provided and feeling secure, he sent a cashiers check for the total amount. The seller informed the buyer that all the paperwork and owner’s manuals would arrive to him the next day. They never arrived, so the buyer called the seller and was assured they were on the way. Finally, after about 10 days, a box arrived, but it was filled with a pile of newspapers but no manuals. When the buyer called the seller, he discovered that the phone number had been disconnected. By this time, his cashier’s check had already been cashed.(surprise, surprise)

So what could the buyer have done?

He might have called a local Jaguar dealer close to where the seller lives and asked if they would take delivery of the car he he paid them a few hundred dollars. They probably would’ve done that. Then, you could have sent the check to the dealer to hold until the car arrived, and the dealer could register it in your name. Or, another way to complete the deal would be to fly out there to pick the car up yourself, bringing the check with you. This way, nothing is paid for until you see the item yourself and are satisfied. If the item you’re buying is over $500, taking extra precaution may well be worth the extra time and money.

I’ve had experience in this area myself. I had the chance to purchase two paintings in Florida that were supposedly painted by a well known artist. I decided to call a friend of mine who was in the auction business in that town and ask him if I could have the two paintings dropped off at his place of business and send the check for $50,000 to him. He agreed.

When the paintings arrived, he quickly photographed them and e-mailed me the photos. I sent these photos on to the authority on this artist. Almost immediately, the authority on this artist responded to me saying, “We saw these two paintings about two years ago. They were fakes then, and they are still fakes today.”

I called my friend and asked him to send me back my check and have the seller pick up his paintings. What do you think would have happened if the check had been sent to the seller? If you’re buying high priced items, I sure any local auction house would agree to accept your items if you paid them something for their time and effort.

What are some of the other things you can do to protect yourself from scams and fraud?

You might ask the seller if you could have the piece picked up. If he says, “yes,” then that has improved the chances that you are dealing with an honest person. Second, if you’ve been in the business long enough and have business references, you might be able to persuade the seller to send you the item(s) and if they are as he described, you will over-night him a check. Or, you could ask for the name, address and phone of the seller’s bank. This way you could check out the person you’re dealing with.

I did this very thing when I wanted to buy a very nice piece of Lotton Glass that was listed on eBay. The seller had no feedback and no rating so no one would bid on it. I called the seller and found out he was staying with a friend, which made me very suspicious. Strike one. I asked if he had a bank account in town and he told me “yes.”

I got the bank information and called to check the account and was told it had just been opened the day before. Strike two, right? Well, I didn’t want to give up so I asked if his banker would receive the vase. I’d be able to check out the vase with the banker and then send a check payable to the seller in his banker’s care. Believe it or not, everyone agreed to this and I profited by about $4,000.

Make every effort to protect yourself and this business will be even more fun than it is already.


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