EBay: Den of Thieves?
Crooks looking to unload stolen goods are increasingly turning to eBay to find buyers and reap some quick cash.
In the past few years, police have busted at least three major fencing rings on eBay in which burglars and thieves from Boston, Chicago and Jackson, Mich., used the online auction marketplace to sell thousands of dollars worth of jewelry, electronics, coin collections, baseball cards, designer clothes and household goods.
In late February, Chicago investigators nabbed two Marshall Fields window dressers who allegedly stole more than $2 million in high-end merchandise and then posted the stolen items for sale on eBay. The thieves stole a slew of pricey items, including $5,000 purses, $3,000 mens suits, $1,500 sweaters, computers, jewelry and even a $450 cashmere baby blanket and then posted the merchandise on eBays auction site for sale to the highest bidder.
In June 2000, two men in the Boston area were arrested for burglarizing more than 100 homes and selling the stolen goods -- baseball cards, collectors edition coins, jewelry and silverware -- on the popular auction site.
And in August 1999, two men from Jackson, Mich., were charged with selling stolen goods on eBay. They sold at least $19,000 worth of shoplifted merchandise, including digital cameras, fishing lures and radios, to buyers around the globe.
Kevin Pursglove, spokesman at eBay, said the San Jose company and its shoppers would have little reason to suspect that a particular item up for bid was stolen. Pursglove said eBay has 22 million items up for bid each day, which generate more than $22 million in daily sales. With that amount of traffic, there is no way to completely police all commerce, he said.
"With the overall level of e-commerce activity on eBay, problems like this are minuscule," Pursglove said. EBay limits its liability by calling itself a "venue."
"We are not involved in the actual transaction between buyers and sellers," according to eBays user agreement. "As a result, we have no control over the quality, safety or legality of the items advertised."
EBay does insure goods up to $200 with a $25 deductible, and it offers an escrow service by which a seller is not paid until the bidder has inspected his or her purchase.
Of course, fencing stolen goods is not a new crime. But before the rise in popularity of online auctions, thieves had few options to dispose of stolen goods quickly. They often dumped them at pawnshops for much less than they were worth.
Police said criminals usually collect only 25 cents on the dollar when they pass off fenced material. But on an auction site like eBay, a bidding war can result in much higher profits.
However, selling stolen goods on eBay and other Internet auction sites is a very risky proposition. Instead of anonymously fencing stolen goods in a pawn shop for a handful of cash, the criminals are creating a paper trail that is easy to trace, said Angela Bell, spokeswoman at the FBI.
However, selling stolen goods online is a cybercrime some experts believe could become more common and more sophisticated.
In 1997, the Federal Trade Commission received about 100 complaints about fraud through online auction sites. Last year, the FTC recorded 10,700 online auction fraud complaints making Internet auctions the biggest source of online consumer complaints.