D.C. The reports of alleged fraud increased from 1,280 in 1997 to 7,752 in 1998, while Internet commerce doubled. Online auctions are the source of two-thirds of the complaints. Consumer advocates don't turn two thumbs down on the Internet. Increasingly, however, attention is being given to the thorny issues of cyberspace commerce and consumer protection. They include questions that can arise in trying to police what amounts to a global marketplace and in interpreting how to apply basic consumer protection rules to a new technology.
Regulators say they have enforcement tools to attack cyberspace fraud, but are adding more.
The Federal Trade Commission has taken 58 enforcement actions since 1994 involving Internet promotions or sales, including investment schemes and advance-fee loans. One analyst said he believes concerns about fraud on the Internet are likely to diminish as more consumers deal with reputable businesses on the Web. Mass. Still, recent actions announced by the state attorney general's office shows the sweep of issues that continue to be raised by cyberspace transactions, from problems in online trading to the use of the Internet in an alleged fraud. Last month, the state announced the launch of a study of online stock brokerage firms, following dozens of complaints about system crashes and delays in executing trades. The attorney general also reported a judgment against a Queens company that promoted itself as a literary agency and misled consumers through postings on news groups and bulletin boards on the Internet.