Profile of an eBay Scammer

prostoalex writes "FastCompany is running an article about Jay Nelson, whose primary income source for about 5 years included selling goods on eBay. Considering that he chose to skip the delivery, the profit margins were at an all time high. Under the names of biggerthanu, harddrives4sale, diamondsoft, yoshiinc and susancutey Nelson would collect five-digit PayPal payments from the buyers on eBay and Yahoo Auctions."

Comments

Theft or no...

[The Only Druid]

I'm not saying this guy didn't steal a tremendous amount of money, but I'm shocked he was able to perpetuate such an series of thefts. Isn't this the purpose of the eBay rating systems, etc.?

Re:Theft or no...

[theNote]

You obviously didn't bother to read the article.

It goes in depth on how he rated himself with multiple screen names and used various other techniques like buying inexpensive items from others with fake mailing addresses.

I love the image of the postal inspectors carrying guns. Reminds me of the accounting division of the FBI that walks into the accountants office strapped with a piece.

Re:Theft or no...

[Jhon]

One of the interesting things I found about the article was the listing of some of his "usernames". I checked my ebay transactions a while back and found I had one with one of his accounts. I had received a broken proxim wireless modem. I mean broken -- it rattled, the case was cracked etc.

I looked at his feedback and checked on some of his older positive feedback transactions and found that the pay-pal link was identical to the one I had purchased from. I sent a mail to THAT user saying basically "You are [BLANK] I know this because the paypal links on both user's auctions point to the same account. How about you either refund my money or send me a working item and I let this go".

He said he was the BROTHER... blah. I think the idea of getting reported scared him enough that he sent out a WORKING modem.

Moral of the story: If it's an item that's going to cost you more than what you can comfortably lose, check the old feedback for anything suspicious -- like identical paypal links, a lot of 1 or 0 feedback bidders (shills), and even how LONG the account has existed. One month? Two? A few years? The longer an account has been around with a decent amount of feedback are USUALLY good indicators.

Re:Theft or no...

[ralphclark]

But that would cost them money and eat into their multi-billion dollar profits. It could cost them, ooh, thousands.

The main problem with eBay is the enormous and insatiable greed of tyhe people running it. They know the law will eventually clip their wings. They just want to make as much money as they can before that happens. They're no better than the scammers, in other words.

And the difference with the stock market is?

[tjstork]

If this guy had done the exact same thing for 10 billion dollars, lying about stocks on the exchange as he drove a company into the ground, he would be considered an investment guru would be free.

Let's see who damages the economy more:

Ken Lay, Robert Smith, Carl Icahn, Nassar, or this guy, and which of the above is going to jail? :-)

Re:And the difference with the stock market is?

[EvilTwinSkippy]

If one person it ripped off, that's a tragedy. If one million people are ripped off, that a statistic.

I guess the only moral of the story here is that if you are going to rip people off, do it for a couple of million at a time, not a couple of hundred.

Though looking at what this guy managed to steal, $200 grand? Over 5 years that's $40k a year. And he is going to rot in jail for 6 years.

What a complete idiot.

If he had put a fraction of that brainpower used to scam people into LEGALLY scamming people he'd have made $200 million and not be facing any jail time at all. Look at Microsoft. One of the biggest companies in the world sells licenses to use software. Look at the RIAA. They pay artists peanuts to gouge consumers for recordings of them playing.

Way to go Paypal

[Shdwdrgn]

Considering all the horror stories I've read on paypalsucks.com, this story somehow isn't as shocking as it should be. How is it that people like this continue to operate, when legitimate merchants are getting screwed out of their cash?

What's really incredible...

[popo]

What's really incredible is that this doesn't happen more often. How many times have I bought things on eBay from "New" mercants? (ie: merchants with no reputation score). Most frequently its for low-dollar items -- so its no big deal anyway. But for all I know its a scammer creating his latest false-ID.

I've yet to be ripped off though.

But even if all buyers diligently checked the reputation of their sellers, how easy is it to have multiple logins and create a "false reputation" for yourself as a seller?

I'm always amazed that eBay works as well as it does...

Re:What's really incredible...

[satellite78]

how easy is it to have multiple logins and create a "false reputation" for yourself as a seller?

you can have an ebay id for every email address you have. however, the biggest scam currently on ebay involves stealing other people's good reputations by gaining access to their account and then posting high dollar auctions - laptops, digital cameras, etc. a huge majority of these will ask for payment via western union to a foreign nation. people who are only checking feedback are continually scammed by these people.

your best protection (as a buyer) is to pay for any auction with a credit card via paypal. ask your seller a question before you bid. their answer will help reveal if they are the kind of person you want to deal with. check their history. did they sell 100 widgets for $1 and then suddenly list a plasma tv?

i would also suggest any buyer check out the trust and safety forum in the community section. a quick read of the latest messages will alert you to the current scams and help you avoid them.

eBay has become unusable because of the scammers

[Mwongozi]

Over the past few months, I've been trying to clean out my Cupboard of Random Tech to sell some old mobile phones, a couple of laptops, and some miscellaneous techy things.

Usually I have to re-list an item 3 or 4 times before it sells, because people will bid, win, and then simply disappear off the face of the Earth.

Also, the number of e-mails I get asking if I can ship to some obscure country where credit card fraud is thriving is very high.

eBay needs to find some way of beating the scammers to survive.

ebay is full of scammers, $5 at a time

[Stubtify]

Well I've never been burned for a large amount of money, I have had items for under $20 become "lost" in the mail. I find it hard to believe that in the 20 years I've used the postal service I've never once had a piece of mail become lost, yet ebay sellers seem to magically have trouble in this area.

It pisses me off too because they know that for $20 or less its not worth my trouble to do anything. Plus they can send negative feedback regarding the transaction if I do the same. I know I've been burned and still ended up with negative feedback against myself as "retaliation." The Feedback system in ebay needs to seriously be reworked. As the article states the seller could buy a hundred stamps for a dollar and have a great rating and then just rip everyone off.

The only way that I can recommend giving yourself a little extra security is to Always pay for the damned insurance. At least then when they say its "lost in the mail" you can say "ok fill out the form and get the money back to me." Then you could take things further up the ladder if you don't get anywhere. I really think that most sellers know this and that is why they use non insured auctions as a way to take extra money.

Re:ebay is full of scammers, $5 at a time

[PReDiToR]

eBay buyers and sellers are retarded in that they consider a deal done as "A++++++++++" rather than as a normal transaction that went OK and they paid for something and came away with it.

When was the last time you went into McDonalds and bought a burger, then proceeded to scream to everyone on the street "HEY!!! LOOK! THEY SOLD ME A BURGER A++++++++++++ BUY HERE AGAIN!!!!!" or something equally as stupid?

Neutral for every day "won, paid, recieved" and Good for "won, paid, mess up, fixed, got goods even though someone was moosing araound with us" or "came second, emailed, paid, recieved second set that were going to be auctioned next week".

Or is this too much of an ass kissing world where we expect to get ripped off online that if we don't we feel the need to stroke the guy who didn't even think of ripping us off with a long list of A+++++++++++++'s?

Re:ebay is full of scammers, $5 at a time

[Spunk]

True story:

I bought a video adapter for $16 on Ebay a few weeks ago. I didn't pay insurance, and the guy claimed it was lost in the mail. A scam, you say? Judging from his zipcode, my zipcode, and the date, it was actually quite plausible: a truck carrying mail from his area to mine got into an accident and the mail was destroyed. It was in NC and featured in the local newspapers, but sadly I can't find a link at the moment.

In the end, he refunded my money, even shipping. yay!

Excellent Ebayer. Would do business with again. A+++++++

Re:Charge his credit card for any scame he did

[Stubtify]

The problem in doing that is that you will then have a whole group of people who claim they never got their goods and end up ripping off the legit sellers. Its a screwed up system in the first place because of its anonymous nature.

eBay is a joke

[whereiswaldo]

Don't forget to read the sidebar

One area where eBay has gotten consistently high marks is in collaborating with law enforcement.

"We treat law enforcement [agencies] like a customer," Chesnut says. "We make sure that they get the information they need to fully and fairly investigate cases." And eBay leverages its experience with serial auction fraud - like the Jay Nelson case - to try to figure out how it can prevent future occurrences.

"Resting on our laurels isn't something that crosses my mind," Chesnut says. "I'd sure like to have the reputation of being the worst place on the Internet to commit fraud, because we're going to come after you, and you will go to jail."

If they treat law enforcement as a "customer", then law inforcement must have a lot of unreturned emails and automated replies.

I challenge anyone to find a conspicous mention anywhere on the EBay site where you can phone and talk to someone about someone defrauding you money.

I've lost over $200 on EBay and have all the evidence in the world but EBay will not do anything about it or even acknowledge the problem by sending a human-generated response.

I thought I got scammed once

[Stonent1]

I bought a few DIMMs for one of my SparcStations. A week or so passed with no items. I contacted the seller and he gave me the date that the item was shipped. A few days later I got a sticker on the door saying my item was at the post office. I went there and they said someone filled out the wrong form. They meant to send me a form saying my item could not be located. I went back and forth with the seller with him supposedly going to his post office and complaining. Still not knowing if it was ever going to come. About 2 months later the packaged arrived with the original shipping postmark. Pretty good for "Priority" mail.

Don't break your arm patting yourself on the back

[Syncdata]

I like how the Postal inspector (Higgins) is trying to make this out into an epic battle between a criminal mastermind, and himself, a master-sleuth.
Higgins had been on eBay once or twice, but he'd never bought or sold anything on the site. Working the Nelson case was "a fast learning process," he says. "It was like skipping 101 and going right to the master class."
The perps ID lead straight to his home address. No PO box, no nothing.
This is an example of how long some dumb punk can get away with a pretty simple fraud, not an example of investigatory brilliance. Hell, the guy had already been visited once before by a postal inspector.

There is a problem of ethics in our society...

[John Seminal]

Everyone thinks they deserve a good lifestyle simply for being born. The problem with these kinds of people is they are not willing to work for anything. Take the following example from the article:

When he applied for a job as a Lotus Notes administrator at Caterpillar, for example, Nelson said that he had a degree in criminal justice and that he was familiar with Notes. "I got a copy of Lotus Notes for Dummies and learned enough of the buzzwords," he says. After three rounds of interviews, "they hired me on the spot," Nelson says. "I'd never even turned on the program." But he was a quick study, and he says that he was soon competent at creating and maintaining Notes databases.

We have a society where people want to do the least amount of work, if any, to get the reward. And when they fail, they blame society and find ways to steal. Perhaps if people felt a sense of responsibility for what they do, we would not have these problems.

Re:There is a problem of ethics in our society...

[JaredOfEuropa]

We have a society where people want to do the least amount of work, if any, to get the reward.

Every kind of society had/has its share of shirkers; this problem is not particular to western or capitalist societies.

What is particular for our type of society (and some other types) is that it wants its members to be succesful. The 'ideal' thing in our society is to do well in school, get a good job, get a nice raise and promotions from time to time, marry, buy a house and a good car, and live the good live. Those who do not attain this ideal may feel left out... in fact, their peers may start wondering about them. And this feeling may drive some people to turn to crime or unethical behaviour in order to attain the ideal... others may sit and moan about society being unfair.

I've spent some time in the Dutch Caribbean, where no-one gives a toss about how much you make, how your career is progressing or what kind of car you drive. I must say it's been refreshing to live in a society where there is no constant pressure to perform. Then again, very few people there feel the need to perform, and thus not much gets done. The real question of course is: who lives the better (ie. more enjoyable) lifestyle? Us or them?

eBay knows this happens and doesn't care!

[mwfolsom]

One of the reasons Joe and people like him get away with this is that eBay doesn't care. They make it practically impossible to turn someone like him in to the "authorities". They know this is going on and turn a blind eye to the problem.

If you get ripped off after an eBay auction there is a "system" called "Safe Harbour" you can go through to handle the situation. The dirty little reality is that its fairly difficult to deal with and is really designed to protect eBay from any liability while not adding to their workload in any way. There are time limits that get imposed on you in all sorts of ways and there is no human being to help you through the process. In short, it is more "apparent" than "real".

Re: the feedback system. Again, its set up for eBay's benefit. There are limitations on the number of letters you can use in your feedback and you won't know if or when a seller responds to your complains. It requires that you constantly check back and counter any statements such as "it has been shipped - let me know if you have problems". Unless the buyer cares to continue to fight a war over the theft forever sooner or later whatever they say will be countered. And, remember that no person at eBay will ever bother to monitor a seller's feedback so even if you get lots of negative feedback there isn't any cost save a few buyers that might stay away. This of course is easily handled by "selling" great stuff cheap. Since you won't ever ship it anyway this isn't a problem.

Finally, even if a seller builds up a bad "feedback record" this isn't much of a problem. He/she can just change their name and start all over again. eBay doesn't care.

Frankly, my guess is that you can steal lots of money from people on eBay as long as you do it in small increments. The story only talks about the most blatant form of theft at eBay. What about those who knowingly ship defective merchandise and say its good? This happens a lot on eBay. Most people just can't spend the time to jump through the "hoops" eBay has set up to get money after it is stolen. And, the nasty fact is - even is you spend time on the "process" you may never see a cent of it!

Remember, it is the seller who pays eBay so their customer isn't the buyer - its the seller! eBay gets its cut each time so as long as it doesn't hit the press and hurt sales it ain't their problem. eBay survives because most sellers are honest. If/when that changes it will be interesting to see what they do!

Hardly the only eBay scam out there...

[wahmuk]

I just got an email last night, of the type where it appears to be from eBay (it's not) and it's asking for you to verify some information. The URL in the body appears to be a valid eBay address. And although the email appears to be plain text, it's actually HTML and the "valid eBay address" actually takes you to a non-eBay and non-secure IP address where you're presented with a poorly-worded form asking for name, address, passwords, PayPal username, password, credit card numbers, etc...

All other links on the page go to the valid eBay "help" and "contacts" pages. It looks really official, except for the non-professional grammar.

I wonder how many people fall for this type of scam every day?

It wasn't even sent to the special email address that I use exclusively for my eBay account (my first clue, woohoo!).

And yes, I've already reported it to eBay...

Wot sez we demonstrate the SlashDot Effect(TM) for the thieving bastard?

Here ya go:
http://cgi1.ebay.com/aw-cgi/ebayISAPI.dll?UPdate

. . and the point of Safe Harbor is?

[zo219]

The point is, Ebay has figured out a way to make zillions while steering all possible risk to the consumer. This is genius. Unlike any other business I can think of. Sure, shopping on Ebay has changed - you can't move an inch without being cautioned to Know Your Seller and similar worthless crap.
It's gotten even more specific: don't buy from sellers who demand wire payment. Who refuse escrow. And above all, rest assured, your purchases are protected up to a big fat $200. I have this incredible idea - but no one at Ebay seems interested. How about, don't give sellers the option in the first place to list high-ticket items without escrow service? How about that? And "Feedback?" Clap your hands three times if you believe in Feedback. I figured it out. Ebay uses their customers for friggin' scam triage. I came across new Powerbooks at absurd prices, sent inquiries - and heard from five different guys. In Spain. At the same address. Special deal. Wire money first, please. Emailed Ebay - next morning, all gone. Fine - but try finding the form to email Ebay. The least, the very, very least they could do is a small "report suspect listings" button. A "community." "Built on trust." Sure, Meg. Need another wheelbarrow? or does the bank come to you.

Positive

[Anonymous Coward]

great article, nicely written, very informative, will read again!!!! A++++++++++++++

Back in 97/98 we caught a scammer on EBay

[jesup]

In 97 or so, there was a scammer on EBay who was fleecing the Japanese sword collector community. He knew something about swords, and had done some real deals, but then started ripping people off - both not sending things and cashing money orders (this was before paypal/etc), and offering to repair/polish blades, taking the swords, and not sending them back. He was in the midwest at the time. People started to figure it out, and got together. He made the big mistake of ripping off a Deputy elsewhere in the midwest as well.

He switched screen names and moved out of the town he lived in. He started scamming again under the new name, and I both identified him by his use of his real name to sign an email, and I proved he was using an image from someone else's website as the sword he was selling. We arranged for one of us (using a new screenname) to be the high bidder (the Deputy from KS). This gave us an address (Mailboxes/etc I think) in the northwest. He was arrested and forced to return about a dozen swords (and money I think), and I think was given a suspended sentence. He'd probably scammed on the order of $20-40K or more; one of the bigger ones at the time.

Note: while I helped track him down, I was lucky and wasn't taken by him, so after he was caught I only heard a few random details.

everyone bitching about how ebay/paypal/etc sucks

[jbellis]

is apparently missing the single biggest change ebay made to prevent people like this guy from building up positive feedback:

they separated buying feedback from selling feedback. now to get +50 selling, you actually have to sell 50 items, not just buy a bunch of paperbacks and give a false address.

of course you can still get positive feedback selling cheap items but it'll take you a few days now instead of a few hours.

could ebay do more? probably. but at least they're not missing the obvious.

Ebay Scammers

[draed]

I got scammed out of $1,500 on ebay a couple months ago... I researched a bit on what my options where and filed complaints to paypal and ebay. Paypal found the seller guilty and was able to get me back a total of *50* dollars out of the $1,500.

It's amazing how difficult it is to get anything done about online fraud.

Anyways, in doing research, here is a very helpful site I found : http://members.ebay.com/aboutme/!turk

and don't ever order from these companies :
http://www.factory101.com/
http://www.my1stop2gaming.com/
http://www.masonavenue.com/

Re:eBay has become unusable because of the scammer

[Anonymous Coward]

In my experience as a long time sellar on eBay, since 1996, there are certain categories which attract "scum." Computer hardware/software, video games, jewelry/watches, toys (especially Transformers) and worst of all consumer electronics.

When I do get a non-paying bidder, I follow the eBay guidelines, eventually get a refund on my fees and relist the item. I require the buyer pay postal insurance on all items over $ 20 to guard against the "item never arrived" excuse.

As I see it eBay has no incentive for guarding against non-paying bidder fraud. Most sellers won't complain so eBay makes double when the item is relisted.

How NOT to get scammed

[MoxFulder]

Okay, I buy computer parts and electronics and such on ebay from time to time. Generally $20-$200 items. It's usually a good deal. I've never had a bad experience, though I've passed up many a good deal from a seller with insufficient feedback.

This is what I do:
(1) check out seller's feedback, make sure they've sold similar things before. If they have less than ~50 positive feedback and any legit negative feedback, I don't bid.
(2) ask seller a question about the item, something so they'll have to put a minute or two of thought into it and actually LOOK at the item.
(3) if they respond in a timely manner, I can be fairly sure they actually have the item.
(4) go ahead and make a SINGLE BID for the item

Re:Capitalism v. Free Market

[squiggleslash]

Interesting article though it really seemed to be a triumph of dogma over facts, an insistance on promoting what the writer opposes (in this case socialism) as something that it isn't to the point of rewriting history.

The man most often credited with "founding" socialism was Robert Owen. A Google search will bring up websites about what he believed, what he was trying to do, and how he did it. In essence, Owen ran textile mills, felt that his industry was dealing with the people doing the work poorly, and proposed ways in which his business could be restructured to give his workers and their families a decent life. Despite Modern American (including Hessen's) dogmatic portrayal of socialists and socialism, Owen didn't involve the State in anything beyond one attempt to outlaw child labour.

Omitting this might seem just carelessness, but actually Hessen chooses to write about that very period in history, describing the period as being some sort of war between evil Socialists who were trying to eradicate "individualism" and the mill owners who could do no bad because, well, things weren't actually worse were they:

Nonetheless, by the 1820s and 1830s the growing specter of child labor and "dark satanic mills" generated vocal opposition to these unbridled examples of self-interest and the pursuit of profit. Some critics urged legislative regulation of wages and hours, compulsory education, and minimum-age limits for laborers. Others offered more radical attacks and alternatives. The most vociferous were the socialists, who aimed to eradicate individualism, the name that preceded capitalism.

Socialist theorists repudiated individualism's leading tenets: that individuals possess inalienable rights, that society should not restrain individuals from pursuing their own happiness, and that economic activity should not be regulated by government. Instead, they proclaimed an organic conception of society. They stressed ideals such as brotherhood, community, and social solidarity and set forth detailed blueprints for model utopian colonies in which collectivist values would be institutionalized.

While it's true that Socialists like Owen promoted brotherhood, community, and social solidarity, and even designed model utopias which had a few common areas (erm, basically, kitchens and schools, and these "utopias" were, for the most part, intended to be supplied by employers like Owen for their workers, in order to be more humane), to suggest, as Hessen does, that these were repudiations of what had become known as capitalism, and were promotions of coerced, governmental, involvement and a destruction of inelienable rights, is an extraordinary jump. This is not to imply that there wouldn't have been those calling for government regulation who were socialists, but the picture of a unified group opposed to trade and a free market, in favour of government regulations (at a time when, in Europe where this movement started, the governments were hardly seen as friends of the poor - the poor couldn't even vote in the UK, you had to be a male landowner to do that) is an absurd one. It is even more absurd when he adds comments about inalienable rights, especially given socialists were, by and large, trying to improve rights for everyone rather than allow a situation where by economic circumstance, their's or those of their parents, someone may be deprived unfairly of any degree of reasonable control over their lives.

This kind of slap-dash rewriting of history is why it's very often difficult to take the ideological Right seriously. Simplistic paintings of "socialism", over-zealous faith in the "free market" to solve every problem, and a refusable to even accept the possibility that people might need protection from some forms of greed, combine to shore up reasonable ideas with unreasonable justifications.

Unfortunately, since Reagan and Thatcher made these ideas fashionable, these views are taken far more seriously than they should be.

The Obvious Solution

[Slur]

(1) Never ship anything until you receive payment in full.

(2) Never pay for anything until the shipment arrives in good condition.

Voila, problem solved.