Scammer Guilty of $2.7 Million Online Auction Fraud
Auction scams are messy. Consumers who are new to the world of online
auctions are more likely to fall victim to deals that are too good to
be true. Victims either get stuck with inferior or counterfeit goods, or
they are charged and never receive the purchased item at all.
My spouse used eBay to search for skin care products, and was
pleasantly surprised by the low prices she found for the products she
wanted. Since she doesn’t have much experience with eBay, she called me
over to help her complete the transaction. I saw that the seller had no
feedback from previous buyers, and suggested that my wife hold off on
the purchase. She begrudgingly agreed with me, and the next day when she
logged in, the seller had been suspended from eBay. (I told her I’m
If it looks like it might be fraud, it probably is.
A Romanian man recently pled guilty
to charges of wire fraud and conspiracy before a Chicago judge, after
having acted as a money mule in a scheme that scammed eBay, Craigslist,
and AutoTrader users out of $2.7 million. The man’s associates in
Romania used auction websites to sell nonexistent cars, motorcycles, and
RVs. Buyers paid by wiring money to the scammers’ accounts, but never
received the expensive items they had supposedly purchased.
Online classified and auction websites could prevent fraud
and protect their users by incorporating device reputation management.
One anti-fraud service getting lots of attention for delivering fast and
effective results is ReputationManager 360
by iovation Inc. This software-as-a-service incorporates device
identification, device reputation and real-time risk profiling. It is
used by hundreds of online businesses to prevent fraud and abuse in real
time by analyzing the computer, smartphone, or tablet connecting to
their online properties.
While iovation does not collect any personally identifiable
information (PII) from their business clients, they have a very unique
view into the connections between computers and the accounts they
access. For example, what might typically look like one transaction to a
single auction site is often a coordinated attack across multiple
sites. When a group of devices hits multiple sites, across various
industries, iovation can detect the attacks through velocity triggers
and shared experiences across their customer base to alert the affected
business and thwart the attacks.
A device reputation check used on a scammer setting up a new account
in an online action site would stop him at the front door, leaving no
chance to post fake items for sale which would soon cause damage to the
business and its customers.
eBay makes safety recommendations
for users, and the first rule is to use eBay’s built in payment system,
and not to use alternate payment methods, like wiring money.
Never provide sensitive personal information like your account
password, a credit card or bank account number, or your Social Security
number in an email.
Before you bid or buy on eBay, know your seller. Look at your
seller’s feedback ratings, score, and comments to get an idea of their
reputation within the eBay marketplace.
I generally recommend using PayPal to help prevent online identity
theft. If you use your credit card, check your statements frequently and
refute any unauthorized charges immediately.
Robert Siciliano, personal security and identity theft expert contributor to iovation, discusses scammers and thieves on The Big Idea with Donnie Deutsch. Disclosures.