Anatomy of an eBay Scam

I never thought this would happen to me, but I think I was scammed on eBay. I’ve touted eBay as a great business tool (and it still is) for nearly 10 years. I’ve told jewelers to use it to dispose of aged inventory, to ease into an online presence, to research coveted brands and resale values, and more. I’ve even been endorsing eBay myself as a buyer and seller. My policy on potential eBay scams has always been to exercise common sense. Well, you really do learn something new every day, as last week I learned that even the savviest eBay users can be burned. Here’s what happened.

On January 7, one of my auctions ended with a very high winning bid (in the hundreds of dollars). The day after the auction, I conversed with the buyer, Authenticgoodiesmami, via email about shipping options. He or she chose one and paid for the item and shipping that day via Paypal, an eBay-owned company. On Wednesday January 10, I mailed the item with insurance to the buyer. After I left the Post Office, I notified the buyer via email that his package was on its way.

On Friday, January 12, I got an email from Paypal. It stated that the buyer filed a complaint citing non-receipt of merchandise. Puzzled, I logged onto my Paypal account; my hundreds of dollars—including shipping charges—were gone (on “hold” according to Paypal). I logged onto eBay to contact the buyer via email and a highlighted message next to his member ID indicated that he was no longer a registered eBay user. The package was already well on its way to the buyer’s home, and the buyer cancelled his eBay account. Authenticgoodiesmami was gone, along with my money and my merchandise.

A nightmare? Yes, and it continued. I called Paypal and over the course of an hour, I spoke to four different unhelpful people and was disconnected once. The fourth person was the most unpleasant and unsympathetic. In fact, he mocked me when I told him that the item was sent without a signature requested upon receipt. “Why would you do that?” hissed the Paypal customer service representative, his voice oozing with sarcasm. I explained to him that since the item went to the United Kingdom via Air Parcel Post, getting a signature upon receipt wasn’t an option. “There’s really not much Paypal can do if there’s no signature upon receipt,” he said. Then silence. No suggestions, no sympathy, and if I could have read his mind, I was certain he was thinking “I so don’t care about your problem.”

At that point I implemented a different strategy. I told him: “I’m a journalist, and my situation is one that could definitely affect my readers, so I’m going to need to be put in touch with corporate communications.” He mumbled a response: “Fine. I’ll get a supervisor.”

John got on the phone. He was pleasant and helpful. When I explained the situation to him, he checked my account and the claim, and even logged in the tracking number from my Post Office receipt so it was on record. Incidentally, if John had not assisted me, I would have not have been able to easily document my case against the suspected scammer (since the previous rep was unhelpful and I couldn’t see a place on the Paypal site to input my side of the story). Plus, if I wasn’t a journalist, I think I would have had an even more difficulat time getting help.

Thankfully, John did help. He said that once the package was tracked into the UK, then the case would be closed and the funds would be released. Great! Next I called eBay to get some more answers; after all, it’s possible that JCK readers are also being affected by sophisticated scammers. I left a voicemail on the press line and later in the day spoke with Chet from the office of the president and Rich from the executive escalations department at Paypal.

Chet agreed with me that something wasn’t quite right about the buyer. Authenticgoodsmami shut down his or her account immediately after the item was sent, and had six negative feedbacks out of a total of 23—a fact I was oblivious to until after this buyer won the item. Plus, the buyer escalated his dispute to a complaint after I provided the tracking number of the package.

Chet stated that eBay members can’t file disputes until 10 days after auctions end, but Rich pointed out that Paypal users have no restrictions on when they can file claims. And if a claim if filed by a buyer, Paypal has no choice but to freeze account funds. After all, what if the buyer’s claim is true?

So this left me to wait until the package could be tracked to the UK and/or the buyer dropped the claim. [If it were a domestic mailing, then I’d need a signature upon delivery to be covered on my end.] Meanwhile, both buyer and seller must respond to dispute records within a few days. January 15 was the deadline for my buyer to either continue pressing ahead with a complaint or drop it. Authenticgoodsmami didn’t respond at all, thus forfeiting his or her claim. Technically, the drama should be over and the funds released back into my Paypal account.

However, Rich had another surprise for me. Either Paypal was experiencing bugs in its new software or the buyer’s credit card was denying the charges because the person’s card was either over the limit or depleted of funds. He assured me that the buyer’s card wasn’t stolen or new to the account and that “the history of the account is in good nature.” Rich assured me that I was covered for the transaction no matter the cause.

So now, the case is dropped by the buyer and I’m waiting to be reimbursed while Paypal reviews the case. Paypal will foot the bill for my item (a guarantee made under its $5,000 a year coverage policy for members) if the buyer’s card is rejected. If the package was lost in the mail, then the shipper would reimburse me for its insured value. But what happens to the buyer, whom I suspect is a scammer? I don’t know yet. I just left a second message for Paypal.

I do know that Royal Mail in the UK documented delivery of my package into the country today, January 19.

Stay tuned for the dramatic resolution of this case, and for tips from Paypal and eBay on how to prevent this scenario, and other similar ones, in the future.