Monday, May 14, 2007

eBayGate: Covering Up Fraud on eBay

At the Town Hall Meeting held on April 30, 2007, Rob "Pinocchio" Chesnut, Senior Vice President of eBay's Global Trust & Safety Group, stated that curtailing fraud on eBay's platforms is eBay's number one priority. He also stated that the group is securing hijacked accounts and nullifying fraudulent listings within 2-3 hours of the first report it receives from eBay community members that spot and report fraud. Chesnut's comments are so far removed from the truth that we are surprised that he hasn't been struck by lightning. Fraudulent listings continue to run rampant on eBay's platforms.

On April 9, 2007, Chesnut announced new fraud prevention initiatives to the eBay community, however, his announcement was vague, and we continue to not see any filters implemented to catch the fraudulent listings prior to them uploading on eBay's platforms. Despite the implementation of Safeguarding Member IDs (SMIs) for items that have bids exceeding the $200 threshold, members continue to receive fake Second Chance Offers. Shill bidding continues and eBay handsomely profits from it, but it is now nearly impossible to report the infraction due to eBay's SMI initiative. There has not been one iota of improvement in curtailing fraud since Chesnut made his announcement.

When questioned by a caller at the April Town Hall Meeting regarding implementing mandatory educational tutorials for new members, Matt Halprin, eBay Vice President for Policies and Procedures, stated that eBay does not want to force its members to take tutorials; it wants to make the buying process simple so buyers can get in and out quickly. The only mandatory educational tutorial that eBay requires new members to take is for members that have feedback ratings of 10 or less that wish to leave neutral or negative feedback for a transaction.

A few weeks ago, the administrator at Company Exposed installed new RSS feeds powered by FEEDBITE. The RSS feeds consist of common scammer phrases, specific email addresses, and well-known items the scammers are known to list on hijacked eBay accounts. At any one time the RSS feeds expose hundreds, if not thousands, of active fraudulent eBay listings. The fraudulent listings appear for endless hours, if not days, certainly exceeding the 2-3 hour window that Chesnut proclaimed was the eBay response time for nullifying these listings and securing accounts.

Although there have been announcements made by eBay that it is actively protecting its membership, there have been no significant or positive changes implemented, therefore, eBay continues to be a thief's best friend and accomplice when it comes to defrauding eBay members.

Recently an eBay member that frequently participates on the Trust & Safety forum provided an excellent definition of fraud:

Fraud: A knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment. A concealment or false representation through a statement or conduct that injures another who relies on it in acting.
eBay proclaims itself as a "safe trading environment." Based on the definition above, is eBay's proclamation true or false?

eBay commits fraud by concealing the extent and prevalence of fraud on its platforms and, therefore, places eBay members at risk through the false representation that eBay is a "safe trading environment." eBay's misrepresentation as a "safe trading environment" is for its own financial enrichment and such conduct truly injures eBay members.


eBay claims it is safe and claims only 0.01 to 0.1% of the visible listings are fraudulent. Unsuspecting new buyers are lulled into becoming members without being properly educated that by becoming eBay members and actively entering into transactions on eBay they will become the number one target to be hacked, hijacked, phished, spoofed, and lured into sophisticated fraudulent schemes to purchase non-existent merchandise.

eBay's fraud calculations are grossly misleading and are only based on claims paid out through PayPal. Members that are defrauded and make payment to thieves through any mechanism other than PayPal do not have actionable claims and, therefore, are not included in the calculations, nor are fraudulent listings that are uploaded and eventually removed by eBay. Also not included in the calculations are fraudulent payments made to sellers through mechanisms other than PayPal. eBay does not publicly report in the aggregate the number of fraudulent listings uploaded on its platforms.


eBay actively conceals and censors its members on eBay community message boards by removing warning posts provided by eBay members illustrating and documenting fraud on eBay's platforms. eBay actively acts to conceal and misrepresent the fraud.

eBay removed member posts on its March Town Hall Forum thread that did not violate board policies. Pointed questions were removed regarding fraud in an effort to conceal members' concerns about this issue. Days prior to the April Town Hall Meeting, eBay blocked access to the March Town Hall Forum thread.

eBay removed and continues to remove any post on eBay's Trust & Safety community board and on other eBay community boards that point to specific or even non-specific proof of fraud on eBay's platforms.

On April 16, 2007, Avery from eBay's Community Development group posted a thread entitled Discussing and Reporting Member-Specific Activity and in part stated:
The manner in which accounts or listings are referenced is less important than the reason why they are being referenced. If it is being used to report a violation, then search strings, item titles, item descriptions, links to other threads with reports, etc. are also examples of posts that are likely not appropriate in these forums.
The original argument for pulling certain posts off eBay community discussion boards was to protect innocent eBay members from mistaken accusations.

However, Avery's comments clearly state eBay members may not discuss fraud in any shape or form, including posting links to the German eBay Trust & Safety community board where eBay members have an official thread to report hijacked accounts.

eBay removed posts linking to its own German Trust & Safety community board when users report hijacked seller accounts with fraudulent auctions. Instead of eBay creating a thread for members to post questions on for the April Town Hall meeting, eBay members were told to submit their questions to an email address. This was done intentionally so eBay members could not review the questions being presented to the panelists at the Town Hall meeting.

It is quite apparent that by eBay's recent actions that it no longer wishes to have transparency on its platforms. Certainly, eBay management is aware of its members' criticisms, but instead of proactively working with members that are knowledgeable about fraud, eBay instead prefers to cover up any traces of both the criticisms and the fraud.

Who is kidding who here? Contrary to what eBay is telling its members, investors, and the media, eBay is not making any visible or significant progress in reducing the number of fraudulent listings on its platforms. eBay has not implemented proactive fraud initiatives; instead it is making its best efforts to conceal fraud, and to censor and sanction its members from discussing fraud. There is no "Trust & Safety" at eBay.

This is an eBayGate cover up; the proof is on Company Exposed's website and is visible by reading the threads on eBay's community message boards and the many blogs and message boards throughout the Internet.

1 comment:


this guy is still at it, my friend did some checking and called his hand in an email and the auction was immediately pulled by the crook not ebay. one of the ways to find some of these guys is to google the email address. i would send this to ebay but i would be wasting my time.
ps great blog!!! i am surprised you dont have more posts

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