What Can You Do When Defrauded on eBay?

zeno_lee asks: "About 55 eBay buyers were defrauded by a single high volume ebay seller. I discovered all the victims by backtracking each transaction this guy had for the past month and contacting each one individually. Everyone lost between $400 to $1700 each. I then started an email group to organize action against him and to get our money back. This guy was particularly successful because he had positive feedback ratings before he decided to jump ship. " Systems like eBay are, as most have seen, extremely popular, but the one big shortcoming is that the system only works when buyers can trust the sellers. It's actions like this that break the system and if dishonest sellers can get away with fraud, auction sites will suffer. What options are there when consumers have been frauded on auction websites?

"Most of us followed the proper procedures. You wait 30 days to file a fraud claim on ebay. Then you have the option of getting $175 at most from eBay's insurance. It softens the blow, but for many it's not anywhere close to what they lost. Contacting local authorities hasn't accomplished anything nor has filing with the FBI. Many people who paid via PayPal did get a refund, but others paid via checks.

eBay has been one of the bright spots of the internet. As a NYSE listed company, you'd expect more to be done about helping customers. I hope this question comes as a warning to be more cautious on eBay or not to bid for items on ebay over $400 without escrow protection. I've learned my lesson not to do business with anyone who doesn't use paypal or billpoint. But regardless of what we learned, most of us feel helpless because eBay has not done more to get our money back. Any suggestions?"

Comments

Auction fraud

[man_ls]

Auction fraud is illegal, I believe there is a way you can file with the FTC and have the fraudelant seller fined thousands of dollars, or even possibly jailed. IIRC, something about interstate commerce, or whatknot. I think you may also get a full refund of the amount of money you were defrauded from, or a portion of the money collected by the FTC in fines; I don't remember which.

Look in to it.

JKoebel

Re:Auction fraud

[schnurble]

Auction fraud is illegal, I believe there is a way you can file with the FTC and have the fraudelant seller fined thousands of dollars, or even possibly jailed. IIRC, something about interstate commerce, or whatknot. I think you may also get a full refund of the amount of money you were defrauded from, or a portion of the money collected by the FTC in fines; I don't remember which.

Absolutely. Since this is interstate commerce, it falls under the category of Mail Fraud. Contact the postmaster in your area, as well as the FTC. You might also want to seek legal advice (I wouldn't retain a lawyer yet) to get specifics for your locality (and his).

Re:Auction fraud

[sigwinch]

Auction fraud is illegal, I believe there is a way you can file with the FTC and have the fraudelant seller fined thousands of dollars, or even possibly jailed. IIRC, something about interstate commerce, or whatknot.

The US FTC doesn't usually handle individual consumer complaints. However, they are interested in finding patterns of abuse and ripping new assholes for serial criminals. It might not immediately help, but filing a complaint on their web page only takes a moment. The various Better Business Bureaus serve a similar function. You can also send complaints to you state/regional Attorney General.

The system works

[CmdrTroll]

If you pay by credit card, you will not have to pay for fraudulent charges because it is the merchant's burden of proof to show that you got what you paid for. Almost all banks are extremely sympathetic to customers who are victims of fraud, because banks (who make about 2% commission on every single purchase on your card, in addition to interest) want to keep you as their customer. They don't have any reservations about sticking it to a bad merchant. And yes, if you paid through PayPal, you can still dispute the charge and win (regardless of what PayPal tries to tell you). I've done it before - because PayPal's customer service takes weeks to respond and my bank (MBNA) is much faster and nicer.

If you paid by check or money order, though, you're just plain silly. Just because a seller has a fancy auction page or a good feedback rating doesn't mean you should send a check for $400-1000 to a total stranger somewhere else in the country and expect the seller to make good on it. Where's your common sense? People get busted for that all of the time and auction sites account for the majority of fraudulent online activity. So think before you pay next time, and good luck getting your money back.

-CT

Re:Paypal doesn't give you much more protection

[soren]

I've used paypal numerous times successfully w/o a problem. Whether sending money from my bank account to someone just for the purposes of cash or purchasing on eBay. There was one problem with an eBay transaction. Suffice to say, the guy never fulfilled his obligation and proceeded to not respond for a month, then I notified paypal, they did their investigation and within a week I received a phone call notifying me that they had refunded the $539.00 -- problem solved. I'm not sure whether the guy had his paypal acct. yanked or who knows what action paypal took, but, problem solved on my end. ;)

That ol' stamp and envelope thing...

[sphealey]

For any significant amount of money on eBay I send the postal money order by U.S. Mail. The penalties for mail fraud are quite severe and the post office does like to investigate reports of same.

See if any of the buys used the U.S. Mail and/or a postal money order. If so, have that person or persons file a complaint with the postmaster of their zip code, and have him reference the other cases that you have dug up.

sPh

I just got done with a fraud battle on Ebay...

[greygent]

I just got done with a fraud battle on Ebay and this page was of immense help, and eventually got me my full money back from the bastard who tried to swindle me:

http://www.mindspring.com/~bookdealers/ripoff.ht ml

Pay particularly close attention to the sections on reporting the fraud to the IFCC section of the FBI, and the Postal Inspector fraud complaint form.

In the postal inspector's case, when you file a fraud report, they notify the person that they're being investigated. This led to me promptly getting a $600 money order from the criminal in question. They actually had the money order to me in a day, and it cost them $25 to mail it. File reports galore, and try to get as much information about the person that you can.

Re:The problem with Reputation...

[choprboy]

The problem with reputation is that it's just so easy to buy! Lets say I go place 20 bids on random crap and my $1 bid wins

Well, gee... Your saying maybe we ought to look at the actual circumstances of the transaction rather then some overall number? Anybody who does Ebay business regularly should look at the seller's actual auctions. More than once I found deadbeats trying to build up feedback like this. Usually a ring of new accounts, all selling ridculous things like "Used condom" or "Banana peal" for $0.01 that closed 5 minutes after it opened with the "Buy it Now" feature. Easy... report them, accounts closed, move on with life.

Just set up a ring of ebay accounts, bid on each other's stuff, and have it sell for higher values

Well, that's a good idea too, it's called "Shill bidding" and it's against the rules. Again, by looking at the actual auctions you can easily detect this. Don't just look at the feedback of the seller, look at the feedback of those who left the seller's feedback, and the feedback of those who left the feedback of those who left feedback. Are they all the same people? Are they all new users whose account were all created the same day? If so, it's a pretty obvious clue there's some fraud going on.

Most criminals aren't very smart, instead they just rely on others being dumber than they are.