As of right now, there have been nearly 1,000,000 iOS devices sold worldwide! As a result, there is a huge market for buying and selling used devices. People are willing to shell out hundreds of US dollars on an old iPhone, for example, just to ensure they aren't stuck in a 2-year contract with AT&T, Verizon or other cell carriers. While it's a great time to sell your old device... buyer beware!
I have sold plenty iOS devices in my time, and while I consider myself to be an honest seller who does whatever he can to ensure the buyer is happy, not all sellers are like me. Some, in fact, are so devious that they will try anything to scam you out of your hard-earned money. One way they do this is by selling you an iPhone that is still locked to their iCloud account. If their iCloud account is still active on the device, there isn't much you can do with it. It's pretty much a useless brick of plastic and metal.
For the longest time, this has been a challenge for buyers. Apple, however, recently launched a site to help us combat this problem.
The only information you need to know about the device you are considering buying is the IMEI number (if it's a cell phone) or serial number (which works for all devices, including iPhone). Both of these numbers can be located in Settings > General > About. If you don't have physical access to the device, insist that the seller provide it to you (a picture is preferred so that you know they aren't making it up).
Once you have one of those numbers, simply navigate to www.icloud.com/activationlock.
From here, enter the information required and click "Continue". In a matter of seconds, it will return the status of that device's activation lock. Below is what it returns for a locked device (which happens to be mine):
If the device you are looking to purchase shows as locked, insist that the seller unlock it then have you try again. If they say they aren't sure how or refuse to, indicating that it's "no big deal", turn and run away!