Identity Theft & eBay

The old adage warns that buyers should beware. But with identity theft being touted as the fastest growing crime in America, and online auction sites like eBay giving anybody the ability to sell their merchandise, it just might be the sellers who need to beware.

With credit card theft being a major contributor to the increasing number of identity theft crimes, it’s no surprise that handfuls of people trying to hock their wares on the internet are being defrauded by savvy identity thieves all the time. While those who have their identities stolen have some level of protection, others who may be defrauded by the thieves are finding themselves with few or no recourses.

For instance, if you post your items for sale on eBay and a seemingly normal buyer wins your auction and provides payment with a credit card you wouldn’t necessarily think anything was out of the ordinary. So, you would most likely proceed to ship the item promptly in order to obtain positive feedback from the buyer. In most cases your transaction would be complete at this point and both parties would be happy.

However, if it is discovered that the buyer was using a stolen credit card you might be out both the money and the item. That’s right. Even though eBay does offer a seller protection plan of sorts, it has been written with enough loopholes to prevent the company from having to eat your loss.

If you regularly buy or sell items on eBay make sure you look for these warning signs so you can avoid interacting with someone with a stolen credit card and being defrauded or framed for his or her crime.

1. Never ship to an address other than the verified address. If you use Pay Pal to complete your transaction, do not ship to an address other than the verified address Pay Pal has on file for that credit card holder.  If you do, you will not be covered under the seller protection policy if it is later determined that your item was purchased with a stolen credit card. So, you would be out both the money and your item. If the buyer insists on having the item sent somewhere else, kindly ask him or her to resubmit the payment after verifying the new address with Pay Pal. If the person claims it is a gift, explain that shipping to an address other than the verified address leaves you without any protection and is characteristic of identity theft. If the person wants your item bad enough, he or she will change the address. If he or she doesn’t, chances are he or she was a thief and you saved yourself from getting ripped off. Thieves tend to steal credit cards and make purchases quickly and have items sent to their addresses while the billing information still lists the name and address of the victim.

2. Do not use the “Respond Now” function. In an effort to make buying and selling on eBay convenient, eBay has enabled a function where buyers and sellers can correspond via the eBay message center. If a potential buyer wants to ask you a question about your item he or she can use the message center and send an email straight to the inbox of your actual email account. The problem is scammers have begun imitating this behavior in a modified phishing scheme. They send emails to people who are frequent eBay users, doctoring them to make them seem like they came through the eBay message center. They typically ask pointless questions like “What’s the shipping to my state?” or “Where’s my item?!” They are worded so that they will elicit a quick response from the receiver.

The problem is a legitimate eBay seller wanting to reply to the message would click on a link where he or she would be prompted to login to his or her eBay account. Only he or she would be logging on to a fake website crafted to look like eBay and he or she would be unknowingly divulging all of his or her eBay account information to someone who would defraud him or her within minutes. Since these emails are well crafted and hard to detect (even for expert eBay users), it is recommended that you log directly into your eBay account and check the message center for messages instead of replying through links via traditional email. If a message appears in your eBay message center inbox, it is legitimate and you can answer it through the message center. If it doesn’t appear in the message center, it was a scam.   

3. When you buy, don’t pay with a check or money order. eBay buyers aren’t the only ones who use stolen credit cards for their own gain. Occasionally sellers will use them too. They will post an extremely high ticket item for sale at a seemingly low bidding price. Once you win the auction they will ask you to pay for the item via check or money order. Once they receive your payment, they will order the item (which they didn’t have on hand) from an online retailer with a stolen credit card and have it shipped to you. This is problematic for several reasons: 1.You now technically have a stolen item in your possession and the police can confiscate it from you. 2. The fraudulent purchase will be traced to you and not the eBay identity thief. If the card is reported stolen before your item actually ships, you will be out both your money and your item. No matter how high a seller’s feedback is, don’t pay for an item in a way that doesn’t cover you under the eBay buyer protection plan.

eBay is still an excellent place to buy and sell goods. But you have to protect yourself. Even high ranked eBay power sellers don’t have the same fraud protection that legitimate businesses do. So, don’t get in over your head. Protect yourself from identity theft whether it’s your identity or someone else’s on the line.