Fraud on eBay has become more common because of the growing eBay community. Some call eBay the new black

market due to the availability of rare items and the low prices users are able to find.

Credit: Steve Schirra

A grilled cheese sandwich that supposedly bears the image of the Virgin Mary.

One human soul fully cleansed.

An air guitar.

These are just a few of the weird items Dan Livergood, sophomore computer information systems major, has encountered on eBay.

While eBay is a great place to find bargains and rare items, users need to be aware of security issues such as fraud and identity theft.

“Anyone can buy or sell on eBay, so you never know who you are dealing with – that’s the risk you take,” said Livergood. “People need to use common sense.”

There are 135 million users, which makes policing eBay a difficult task. Many people use eBay to sell stolen items and scam unsuspecting buyers and sellers.

“If expensive items such as computers are stolen at Kent State, the first place police look is eBay,” said Greg Seibert, director of Security and Compliance.

Kent State police have not been successful in their search, but Cleveland State University police have found stolen computer equipment on eBay.

“The computer equipment was worth $90,000,” said Detective Chris Jenkins of the Kent State Police Department. “Stolen items are common on eBay because there are simply too many users for (eBay) to police everything.”

Sellers are not the only people committing fraud on eBay.

Livergood, who has been a seller on eBay for two years, had an incident occur where a buyer tried to defraud him.

“I was selling a laptop computer and a person from Russia bid $1,300,” he said. “I was surprised someone paid that much for it, but I was excited to receive the money.”

Livergood noticed that the buyer had no history on eBay and had just registered. The buyer also gave very specific shipping instructions, which made him skeptical, he said.

“The day before I was going to ship the laptop, I got an e-mail from PayPal (a security system on eBay) saying the buyer paid with fraudulent funds,” he said. “I ended up never getting the money and having to pay $30 in fees.”

Since he lost money in the transaction, Livergood was able to file a claim in a class-action lawsuit against eBay on behalf of all users. He ended up getting $15 refunded from the lawsuit.

Another security problem that is a weekly occurrence for Livergood is “spoof” e-mail, where people are posing as eBay to get personal information.

“Under no circumstance will eBay send an e-mail asking for personal information,” he said. “If you get an e-mail that doesn’t address you by your first name, it isn’t eBay.”

The scam e-mails ask for a person’s account number and credit card number, along with other personal information.

“The e-mail claims if you don’t send them this information your account will be terminated,” Seibert said. “I have seen a lot of people fall for it.”

Both Seibert and Jenkins agree that identity theft is the most common security issue on eBay.

“Scam e-mails are a problem on the Internet in general, but Greg Seibert has done an excellent job making Kent State aware of this security issue,” Jenkins said.

Seibert recommends people use PayPal, which acts as an intermediary between the buyer and seller. PayPal holds the money until the buyer receives the item from the seller.

“EBay recognizes all the scamming going on, so PayPal is a way to facilitate security,” Seibert said. “I would recommend PayPal to people who buy expensive items and to sellers.”

Many buyers who do not use PayPal end up losing their money.

Brian Gray, junior fine arts major, who has been a buyer on eBay for five years, said he has paid for items he never received.

“The item only cost me $10, so I didn’t challenge it,” Gray said. “If it was more expensive I would have taken more security precautions.”

Students who live on campus are technically not allowed to sell on eBay due to university policy, although Seibert said interpretation varies. The policy states that “people may not use university resources for personal commercial gain.”

Seibert said this does not forbid students from reselling last semester’s textbooks or old junk.

“Usually the only way that I ever find out about students running a commercial enterprise is if I start to get complaints from eBay that you cash checks and don’t deliver the merchandise,” Seibert said.

Seibert said he has encountered situations in which students who sell on eBay are allegedly scamming.

“Buyers from across the country have called us complaining because they never received an item sold to them by a Kent State student,” Seibert said. “They try to get us to do something, but it doesn’t work out because we don’t have jurisdiction.”

Jurisdiction is a main problem on the Internet for law enforcement, Jenkins said. There is no clear resolution on what law enforcement investigates and prosecutes criminal activity on eBay.

“If a used car is sold in Kent to a buyer in California who never receives it, does Ohio, California or the FBI have jurisdiction?” Jenkins said.

The problem becomes more difficult when the two people live in different countries because treaties are involved.

Another problem law enforcers deal with is whether the problem between a buyer and seller is a criminal or civil action. Buyers who never receive an item they paid for assume the seller has committed a crime, but this is often not the case, Jenkins said.

“The agreement between a buyer and seller is a binding contract, which means it is a civil dispute,” Jenkins said. “In order for it to be a crime, the buyer has to prove intent.”

A buyer must prove the seller never had the item to begin with or the seller has a history of fraudulent activity. The other option is for the seller to admit his intent.

Another common security problem on eBay is people selling pirated or bootleg copies of movies and music.

“I reported someone for bootleg copies of a rare CD of my favorite band, 311,” Livergood said. “The original CD is out of print and probably worth $200. The CDs being sold were obviously homemade. I didn’t want other fans to get screwed.”

Ticket scalping is another issue on eBay, especially for sought-after events, such as Ohio State football games. EBay has no restrictions on the resale of tickets; however, users must abide by state laws. Laws vary state to state, but Ohio has no restrictions on event ticket resale prices.

“I’ve heard of tickets for the Ohio State football game against Michigan State being sold for hundreds of dollars,” said Lyndsay Kimbro, junior middle childhood education major.

Security issues on eBay are a small portion of the criminal activity on the Internet. Both Seibert and Jenkins agree that in the decades to come, law enforcement will have more of a presence on the Internet.

“The accessible nature of the Internet and the possibility to remain anonymous makes it easy for people to commit crimes,” Jenkins said. “I do see law enforcement applied the same as in the physical world in the future.”

People need to take proper security precautions and use common sense. Although there are negative aspects of eBay, there are also a lot of positives.

“EBay offers so many opportunities for everyone from students taking on entrepreneurial roles to individuals with disabilities who sell from their homes,” Seibert said. “The good definitely outweighs the bad.”

Contact enterprise reporter Breanne George at [email protected].