Five Tips for Safe Online Shopping

Most online merchants accept both credit and debit cards. Under federal law, credit card issuers can only hold customers liable for the first $50 of fraudulent transactions, and most issuers will waive even that amount.

While debit card issuers have largely adopted that same approach, your bank account could be overdrawn while you dispute fraudulent charges, particularly if you don't notice the fraud immediately. Experts say credit cards still present less potential for hassle when dealing with your financial institution should unauthorized charges show up later on a monthly statement.

"It's still harder to get your money back from fraudulent transactions on a debit card unless the process is transacted in exactly the way the bank wants to be, and a lot of times consumers have no way of knowing whether a given purchase meets those requirements," said Avivah Litan, a fraud analyst with research firm Gartner Inc.

Never, I repeat, never, shop at sites that ask you to wire your payment or send money orders.

4. Consider Alternative Payment Methods

For the truly fraud-wary online shopper, there are still plenty of alternatives to entering your account number at multiple Web sites. Many financial institutions and card issuers -- including Bank of America, Citibank, Discover, and PayPal -- offer customers the ability to generate unique, "virtual" or "one-time use" account numbers that are good for a single transaction or a handful of specified transactions only and cannot be reused.

While virtual account numbers may make shoppers feel safer online, they may be more hassle than they're worth, Litan said. "These virtual numbers generally are there to protect [the card issuer] more than the consumer, but they do give some online shoppers more peace of mind."

Gartner's recent studies show online shoppers are starting to turn to other alternative payment methods, such as pre-paid gift and credit cards, and services like billmelater.com. The latter allows online shoppers to shop online at some well-known retail outlets without ever having to enter a credit card number (the company requests your name, address, date of birth and the last four digits of your Social Security number to decide whether to grant you instant credit). A number of participating sites are offering perks for purchases made through billmelater.com, such as free shipping and deferred payment for up to six months.

5. Get a Handle on Spam

If you worry that giving away your e-mail address at multiple online merchants might wind up cluttering your inbox with more junk mail, consider creating a new address for each new Web site that requires you to enter one as part of the registration process. This allows you take action if a merchant you're doing business with sells or rents your e-mail address to marketers.

You don't really need to create a brand new e-mail address for each site: Some free Webmail providers -- most notably Google's Gmail -- will allow you to create as many "aliases" for the same e-mail address as you want.

Here's how it works. Let's say your Gmail address is janedoe@gmail.com, and you're being asked to enter an e-mail address at widgets.com as part of their online ordering process. Simply enter the name of the retailer as part your real e-mail address by using the "+" sign. In this case, you'd enter janedoe+widgets@gmail.com. That way, future communications from that retailer or any company that happens to share that particular marketing list will come addressed to janedoe+widgets@gmail.com.

Later on, if a particular online merchant generates a wave of junk e-mail offers, you can create e-mail filters to automatically send all e-mail addressed to the custom address you created to the virtual trash bin.

For the latest computer security news, read the Security Fix blog by Brian Krebs.