Is there no end to the ways you can be scammed on eBay?
One recent listing was for a "Pioneer CD Player DEH-P7300," described by the seller as a "great CD Player overall. Works and looks outstanding."
The listing went on to describe all the features - "Detachable Face ---Pop-up Rotary Volume Control ---Supertuner III ---24-Station/6-Button (18FM / 6AM) Presets ---BSM (Best Station Memory ---AGC (Automatic Gain Control) ---CD ---CD Text ---Track Scan ---Pause ---Repeat ---Random Play ..." and on and on.
But there, in tiny type at the bottom of the listing, was this: "Caution: U r bidding on the oppritunity (sic) to buy me one of these players, not urself. so don't expect to recieve one."
The winning bid was $152. Twenty bids were made over the duration of the listing. Of course, the buyer was a bit suspect, too, judging from some of the complaints in the feedback system about this particular user: "Blocked from my auctions forever!! Will Not Pay!! Stay Away, Stay Away, Stay Away!"
eBay spokesman Kevin Pursglove told me that this particular listing from last August "is a violation of the eBay user agreement in two areas and the item will be removed. The title is clearly misleading and the seller is not actually selling any merchandise."
But 24 hours later, the listing was still available for all to see.
There were lots of complaints in this particular seller's feedback profile, including remarks such as: "Incomplete shipment, shipped in poor condition with no directions, poorly packed."
The problem with fraud being perpetrated via San Jose, Calif.-based eBay is getting more and more attention lately and consumers who were victimized by scams are starting to fight back, in some cases even putting up Web sites devoted to exposing those who defraud.
One such Web site is called LaptopScam.com, which is focused largely on two particular eBay sellers. The site says that: "We are currently tracking about 200 auctions that were completed on eBay with two sellers known as tech-surplus and electro_depot. We anticipate that there are another 100-150 auctions that are yet to be located. At an average cost of $1500 per transaction, that means that these transactions netted as much as $450,000 to $525,000."
Even the mainstream media is picking up on the problem. The trend is described as online auction fraud vigilantism by Ina Steiner at AuctionBytes.com.
eBay, of course, is still a Wall Street darling, trading at more than $60 a share recently and making tons of money.
They don't much like questions about users who defraud other users, but eBay's Pursglove told me this week in an e-mail exchange that "the fraud rate on eBay remains relatively low despite the fact that listings and registered users are increasing at a very steady pace.
"For example, in the first quarter of 2002 eBay users listed 138 million items, 145 million items were listed in the second and 160 million in the third quarter. At the end of the first quarter there were 46 million registered users, 50 million at the end of the second and 55 million at the end of the third."
"Despite the continued growth ... the fraud rate remains at less than 1/100 of one percent of all the items listed," Pursglove said. "The fraud rate is based upon the number of confirmed fraud cases handled through the eBay fraud prevention program."
I did the math and at the fraud rate Pursglove described, there still were a whopping 16,000 cases of fraud in the third quarter. That's more than 5,000 a month.
eBay, of course, offers help for users who have been defrauded and when efforts to hijack eBay accounts began to pick up last spring, eBay beefed up its security measures.
But I'm getting a lot of e-mail from victimized eBay users who say the company just hasn't done enough. Here's one example, from someone who shall remain anonymous:
"The only 'appropriate action' eBay takes against fraudulent sellers is to suspend their registration. They even deny to the defrauded eBay users that they suspended the seller. In an obvious case where 22+ eBayers reported (a seller) eBay simply stated to me -- 'There are many reasons why a member may no longer be registered with eBay. The fact that the member is no longer registered does not necessarily mean there is anything wrong. A member can request to have his account closed for any reason at any time.'"
"The fact is this seller engaged in a common fraud scheme where they register with false information, spend a short time selling legitimately to build a respectable feedback rating, then they list a bunch of items all at once and disappear with the money. I was the second of three people to purchase the same used DVD recorder."
I bounced a lot of this off Ken Cassar, senior analyst at Jupiter Research, who told me "There are some really clever people out there, and some really gullible people. eBay has the unfortunate role of trying to regulate the relationship between these two groups."
Seems to me the process of doing that regulating is a very tough job, particularly given the open nature of what eBay likes to call its "community."
I love eBay for what it offers and for the way it has made good on the Internet's promise of new ways to do business.
But my take is that eBay needs to take some major, substantive steps to combat fraud and then make a lot of noise about its efforts. And it needs to do that soon, before the negative publicity gathers enough momentum to damage the company's stock as well as its reputation.
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