The world of online auctions is becoming as notorious as the Wild West.
Unscrupulous thieves con innocent buyers and the authorities seem powerless
to intervene.
Fraudtracking.com, a campaigning website, estimates that British customers are
losing £500,000 a day through fraudulent transactions on the various auction
sites, but there were just 70 convictions for online auction fraud last
year.
However, there’s a new posse in town, a group of UK cyber-vigilantes intent on
running the internet auction cowboys out of town.
Mike Grant, a Cardiff company director for a refrigeration and
air-conditioning firm, lost more than £600 to a conman working through eBay.
He went online and discovered about 40 people sharing a forum on a Yahoo!
newsgroup who had all been conned by the same trickster, trading under the
name Future-testing. The group members resolved to pool their knowledge and
technical expertise to track the perpetrators. The gang of geeks was born.
“I was so angry that I wanted to take action,” Grant says. “I found this group
and joined in with the private detective work. We tried to pin down the
person or group responsible by finding addresses, comparing bank details and
tracing where user names were linked - anything we could pass to eBay or the
police. We were as thick as thieves.”
The gang of geeks has been active since October, tracing fraudulent account
names and warning other buyers against dealing with the crooks.
Unfortunately, committing online auction fraud is simple. A con artist steals
positive eBay feedback by hijacking a series of honest sellers’ accounts, or
by creating fake identities and using them to leave himself positive
comments. He sells expensive items - from televisions to motorbikes - and
demands that buyers pay by cheque or banker’s draft. While buyers wait for
the goods, the seller disappears behind a wall of false addresses, bogus
bank accounts and phoney contact details.
“The worst thing is that I knew we shouldn’t pay by cheque but everyone - my
son, friends and even the lady in the bank - said it was not unusual,” says
Sally Holmes, a Sussex restaurateur who sent £500 to a conman after she won
an auction for a state-of-the-art television. “Because the feedback looked
so convincing I sent the cheque anyway. The seller kept open lines of
communication, responding to e-mails, but the longer it went on, the more
likely it seemed the guy was a con artist,” she admits.
Holmes, 56, was finally spared the misery of waiting for her TV when she was
contacted by the gang of geeks, which was monitoring all goods being offered
online by the fraudulent seller under myriad dodgy account names. The group
told her that she was among dozens ripped off by Future-testing. A look at
the history of this eBay account shows that until October the seller was
impeccable, but subsequent responses reflect a growing number of complaints
from angry customers whose goods had failed to turn up.
When Holmes reported her case to Battle police in Sussex, “they were helpful
but said there wasn’t really anything they could do. EBay wasn’t helpful -
all I received was a polite but automated response”. Battle police later
passed her case to Hampshire police, which had received a report on the same
trickster from another victim.
About £20m day is traded on eBay worldwide. The site recommends buyers pay via
its own system, PayPal, which offers up to £500 cover for transactions that
meet its criteria, but there is nothing to stop vendors demanding other
methods of payment and Holmes’s case is far from unique.
Future-testing is no longer a registered user, but according to the victims
turned vigilantes investigating the scam, the person, or group, behind it is
using other IDs to continue milking eBay users.
Grant has provided The Sunday Times with a list of 40 eBay account names
linked to the initial fraud. When cross-referenced, they point to a
carefully organised and well structured criminal network. Payments from
victims have been sent to names and addresses in places ranging from Belfast
to Inverness.
“The way we traced the conman behind Future-testing was very time-consuming,”
says Nicola Lees, 44, a member of the group and mother of three children
from Kent. She fell victim to the same scam, which the group believes has
netted £120,000.
“We had a list of those who had supposedly left positive feedback and we knew
these were accounts that the conman was using. We also had a list from the
Yahoo! forum of those who had left feedback for previous scams. We then
checked these names on the eBay website on a regular basis and saw who they
were now leaving feedback for. These were the new scams and we could track
them from the beginning.”
As recently as last month, Lees was able to play guardian angel to one
potential victim. “I monitor what the known accounts are selling,” she said.
“He had already sold a quad bike that night and I succeeded in e-mailing the
buyer and warning them. That has saved them from losing £3,993.
“I have also e-mailed eBay and told them of the two new names the conman is
using. We will have to wait and see what it does. Unfortunately I fear this
is all the tip of the iceberg,” Lees says.
EBay says it treats fraud seriously and investigates all complaints, claiming
to “suspend thousands of user accounts a year” to thwart online criminals.
However, the victims question why the same scam appears to have been going
on for six months, despite the names of suspicious accounts having been sent
to the company.
Police sources on the Hampshire investigation say they expect to update the
victims on progress within weeks. There have been no arrests so far. The
problem is that police lack the resources to deal with online auction fraud,
which is often perpetrated on a national scale but reported to local police
with no e-crime officers.
According to the campaigners, the scant resources mean crooks can continue
unchecked. “When I paid for my TV, I sent a cheque for £718 by recorded
delivery to an address near Dartford in Kent,” says Lees. “I later went to
this address with my husband and the occupants were Czech and spoke little
English. They denied knowledge of Mr Simon Lapuerra, to whom I had made out
my cheque, but we saw post addressed to this man from Lloyds TSB bank.
“We went straight to the police station in Bexleyheath to try to report the
crime. They wouldn’t even let us make a report. I did make a report later
that week in my local police station in Maidstone, which then passed it on
to Bexleyheath. I also have a copy of my recorded delivery slip signed by S
Lapuerra, which nobody has ever asked to see.”
Other victims report sending money to two Barclays accounts, which have
apparently been frozen.
In the absence of official action, vigilante groups offer victims an outlet
for direct action. Another such group, eBay Fraud Watch, has nearly 1,800
subscribers, who share lists of eBay user names, e-mail addresses and bank
details used by con artists. This hall of shame is an excellent source for
cross-checking if you’re worried about a potential transaction.
Turning the tables on the conmen may make victims feel better but it is a drop
in the ocean of online auction crime. The FBI says fraudulent auctions are
far and away the most reported crime online, costing victims an average of
nearly £250 each.
“I’m still so angry about it,” says Holmes of her £500 loss. The
Future-testing scammer had better hope that the law catches up with him
before his vigilante victims do, or there could be talk of a lynching in
town.
How to avoid online cowboys
Never pay by cheque or money transfer - eBay’s PayPal system is much safer
Avoid sellers that want to work outside eBay - a sign they may be using a
hijacked account
Beware of sellers from strange locations - the Isle of Man and the Channel
Islands are often given as false addresses by fraudsters
Is feedback heavily weighted towards £1 or $1 sales? If so, avoid the seller
Has a seller suddenly started selling lots of things (especially expensive
items) they haven’t sold before? – this can be a sign that an innocent
account has been hijacked
Check sellers’ names and e-mails against “halls of shame” on sites such as
scamsonebay.com
Delve into feedback for each seller - check the names of those giving
feedback, too
Offer to pay cash on collection - genuine vendors will often agree
Avoid user names that are random strings of letters
