Days I hate the internet... (Ebay Rant) (1 Viewer)

[Chris]

So, we run a shop here in KC, just four techs. In the last two weeks I've been nearly frazzled as we've had repeatedly had to go through the claimant service, and we have these "fake" buyers who use phony CC's and hijack paypal accounts. In the last week, I've turned in more then $18,000 in bogus transactions.

But last week was the ultimate. Had someone who ordered up some items in January (a bunch) and paid - promptly. Fine. So, we were shipping as many as we could in the order as they came in.. and low and behold.. hijacked. Someone had hijacked someone's paypal and spent somewhere around $30-$40k before they noticed. (thankfully, not all with us)... it took a while for paypal to get it, because apparently this was a pretty well run system and addresses to verify, etc. were all changed so you couldn't easily detect the fraud. So, it took more then 3 weeks before they notify us that it's fraud. Totally and completely sucks.

I've spent the last two weeks totally and completely frazzled. Talk about a way to lose focus; it almost makes the whole practice of trying to sell online worthless. Who wants to deal with the strife, seriously? Last week, on the 12th, we were contacted in regards to the first, which was one of those things were you just say "oh... " and deal with filling out the forms, handle everything.. and you are constantly on the phone. CONSTANTLY. Not dealing with anything that helps you, but trying to help someone who you probably don't know who probably hates your guts. Not because you, as a seller, did anything wrong.. but because someone hijacked them and stole thousands of dollars. So, you do everything you can to help them track down the thief - because it's good for you two.

By the middle of the week, it became pretty obvious this was a ring of faked up buyers - a few other store owners contacted me and let me know that they were running into the same thing..

I always hear about people who get their paypal and accounts jacked - and I've seen it and dealt with it. Thank god no one has ever broken into our accounts. But I will tell you: it can be DEVESTATING to you as a consumer. Last week, I was pretty worried about some of the people as I kept seeing issues of hijacks, and as more of us kept talking.. by Wednesday, I was devoting a big portion of my entire day to dealing with issues of very clever long fraud.

Hearing how some people had been ripped off for thousands, and tens of thousands, I just gulped and thought "good lord". Some of the people who run prostores, etc. are pretty small businesses. A serious hit to their income can be absolutely devastating. While I wouldn't welcome taking a gigantic loss, I had thought about it and was prepared to swallow it, though I would have been cursing for a while - thank god at least no inventory was shipped against the orders before they were caught.. (though it did leave me with several built units with nowhere to go).

Fundamentally, the system put in place right now is broken. If you are someone who buys or frequents buy type sites (ala Ebay, etc.) make an effort to physically get hold of the seller. But if you're a seller, make an effort to physically get hold of the buyer. I've had one or two sellers who got hold of me literally sick - worried sick that they would lose everything - due to BS buyers and the fact that they shipped. Someone had hacked someone elses account, changed addresses, etc. and managed to munge it up to fool them. Now they were out thousands in inventory and money.

So, sellers need to do the same thing: make an effort to get hold of the buyer, not just in email, in real life. In a funny way, that's going to help out a couple of people in my case because I've got phone #s (even if disposable) and full trails of emails, addresses, and other information I can turn over to the authorities.

In four + years of doing this, I've never seen a few week period where I (personally) knew so many people who got "took". If you don't have a secure password on your ebay account or paypal account.. get one. Don't use something silly (I've heard that another seller had a "customer" who had their account hijacked tell him their password was something very simple.. password123) think about what you're using and make sure to protect yourself.


Just a public service announcement and a little rant, now that we've had two weeks of sorting out everything that we were informed of "could" be fraud, I know I will at least sleep a little better at night..

 

[Andrew Pratt]

I attempted to sell a laptop on eBay a few weeks ago and what a time I had with that. First off a guy clicks the Buy Now early the morning after I'd listed it....only to unregister from eBay. He then proceeds to email me spoofed eBay emails and asked me to send the laptop to his sister as it was a gift...he was in Nigeria Luckily eBay's system is setup to automatically refund listing fee's etc if the buyer is no longer registered so it wasn't that big a deal to relist it again but in the next auction I was spammed relentlessly by people trying one scam after another or just emailing me to point me to one of their auctions etc. I ended up selling it privately outside eBay and I'm not sure I'll ever use it again for anything of significant value.

 

[ChristopherDAC]

Considering the way that PayPal gets used for fraud, I was astounded a few weeks back when eBay announced they were discontinuing their "basic" Buyer Protection programme which covered payments by money order and so on. The justification was that these methods were inherently "less safe" than PayPal, and people needed to stop using them!

Personally, with the very small dealings I have, I always use physical payment methods. A Postal Money Order is wonderful because of the paper trail (counterfoil receipt) and because fraud becomes a Federal crime. For somebody running an online business, though, that's scarcely an option now.

 

[Chris]

Ebay is slowly making it so that prostores simply can't work. They've cut down options on us - we all "MUST" accept Paypal as a primary payment, and they jump our case if we advertise credit card logos. To make matters worse, they continue to raise fees. This January, fees went up another 1%. I know, doesn't sound like a ton, but when you're paying Ebay 3/4 points and Paypal 3/4 points, that's 5+ points you're giving up right off the top. It's gone from being a "pinch" to just absolutely unreasonable.

The system by which they use has bent over backwards to be protective of buyers, which is OK, but at times it so significantly cripples sellers that you feel as though you're just waiting to be blackmailed; as their system will always back the buyer unless you prove otherwise.. Last summer, I had a buyer who threatened to negative feedback unless they were given hundreds of dollars in freebies. Oh, nothing was wrong with what they received, they were very happy.. they just knew I should "pay up" to get rid of them because I didn't want 'anything bad said". Thankfully, some forwarded email to Ebay did get that account terminated.

I'm waiting for someone to come along with "the next big thing" and totally rethink this whole concept.

 

[DaveF]

Is this all PayPal specific? Or does it happend with Credit Cards? Or is this an Ebay account problem?

I've only bought a few things from auction sites over the years. I've thought about doing some shopping recently on Ebay, but then I hear these stories and think it's just not worth the risk.

 

[Chris]

Mostly this has to do with paypal. But the scam (in many cases) is beginning to work like this:

Someone from some international country tells someone in the US "hey, I need to buy XYZ, here's my CC and info, I'm going to have it sent to you.. then forward it out to me (whereever that is)."

So, they find a patsy.. let's say the person is in.. Minneapolis, or wherever. They order a ton of stuff through Ebay, by hijacking an account that is in Minneapolis. They order as much as they can and have it shipped to a UPS Store or a drop address where it can be picked up and forwarded out of the country.

Everything "passes" and looks valid for weeks. However, eventually someone catches on and realizes they've been taken for tens of thousands (or less or more), and turns it over to authorities.

The person is then paid back (for the most part) through the buying system, so buyer is protected. The seller, however, loses all product and of course the cost to refund (which is why people like me miss a bullet). The unwitting third party, who is forwarding items out of the country (lately mostly to Phillipines, Indonesia, etc.) in some states (many) may be held culpable for all the loss - thousands and thousands, because they accepted the goods and forwarded them on, and were paid in stolen money.

It's a Lose-Lose-Lose for everyone involved. Even for sellers who catch it (like us) you still have wasted tons of time before it gets busted, and you still have to spend tons of time "fixing" it after the fact to re-do item listings, to manage excess inventory, etc.

It's a really clever plan, actually.. it's been going on for a while, but in the last few months it seems worse then I can remember. Primarily because more and more people use the system, and more and more people are using terrible, easily guessable passwords. (A neighbor to us had their ebay password as "password", until I made them change it). So, I suspect we're likely to see more of it.

The best advice I give to people is:

If you're a seller:

(a) Don't ship ASAP. Wait until you can talk to the person, or get a full verification back, this can take a few days, but on a big ticket item, you're an idiot not to do this.
(b) If you accepted CC, call the Verified By Visa or MC Verification hotlines (toll free) to make sure the address matches.
(c) If you accept paypal, use a confirmed address - but even then, in cases like above, that can be busted. Use a reverse directory lookup to make sure this person is who they say they are.

If you're a consumer:

(a) If someone ever tells you you can make good money just packing items that they have sent to you and send abroad.. yeah, don't do it.
(b) Keep your passwords secure, not easily guessable/
(c) Don't tie all your credit cards to your paypal or other online payment system. And don't ever tie a money market or home-equity account to it.

Just some casual advice

 

[DaveF]

Thanks for explanation, Chris. That actually makes feel better as a prospective buyer.