eBay has faced controversy, including failure to combat fraud committed by buyers and sellers, concerns over its rating systems, and concerns over sales of controversial or illegal items.

Failure to combat fraud

Fraud committed by sellers includes selling counterfeit merchandise / bootleg recordings, shill bidding (undisclosed vendor bidding that is used to artificially inflate the price of a certain item by either the seller under an alternate account or another person in collusion with the seller), receiving payment and not shipping merchandise, shipping items other than those described, giving a deliberately misleading description and/or photo, knowingly and deliberately shipping faulty merchandise, denying warranty exchange after pre-agreeing to return merchandise authorization of defective on arrival merchandise, knowingly fencing (selling stolen goods), misrepresenting the cost of shipping, using bulk shipping prices to knowingly mask much higher costing, individual return shipping, and using pseudo-accounts to make high nonpaying bids on similar items that competitors are selling. eBay has been criticized for not doing enough to combat shill bidding. There are techniques such as auction sniping, which let buyers avoid shill bidders.[1][2]

Fraud committed by buyers includes filing a false shipping damage claim with the shipping company, friendly fraud (receiving merchandise and claiming otherwise), returning items other than received, removing parts from an item and returning it for a refund, sending a forged payment-service e-mail that states that he or she has made a payment to the seller's account as proof of payment, making a low bid then using pseudo-accounts to make high nonpaying bids in an attempt at gaining a low second chance offer price, damaging a non-refundable item to get a refund by claiming that the seller sent the item already damaged (in cases of buyer's remorse), and a package redirection scam, in which the return package is filled with garbage and sent to the wrong address.[3][4]

In March 2008, Professional Coin Grading Service issued an alert noting counterfeit PCGS slabs and various United States and Chinese coins originating from the People's Republic of China being sold on eBay.[5]

In 2004, Tiffany & Co. filed a lawsuit against eBay claiming that over 70% of the Tiffany silver jewelry offered for sale on eBay was fake and that eBay profited from the sales of counterfeit Tiffany items that infringed on its trademark.[6] On July 14, 2008, a Federal District Court judge ruled that eBay does not have a legal responsibility to monitor users selling counterfeit items.[7] In 2010, the Second Circuit affirmed this decision in Tiffany (NJ) Inc. v. eBay Inc.[8]

In June 2008, a court in Paris awarded damages of €40 million to LVMH over eBay auctions of counterfeit bags, perfumes, and other items sold by non-authorized retailers and entered a permanent injunction against eBay auctions of LVMH perfumes, whether counterfeit or not. eBay banned such items from its site.[9][10] Also that month, a court in Troyes, France awarded eBay to pay luxury goods maker Hermès €20,000 due to the sale of two counterfeit bags on eBay in 2006. The court also ordered eBay to post the ruling on the home page of eBay's French website for three months.[11]

Criticism of feedback / rating system

eBay allows buyers to rate any seller with positive, neutral, and negative comments. However, the option for sellers to leave anything other than positive feedback to buyers was removed in 2008.[12][13]

Criticism of the feedback system includes:[14]

  • Small and large transactions carry the same weight in the feedback summary. It is therefore easy for a dishonest user to initially build up a deceptive positive rating by buying or selling low value items, such as e-books, recipes, etc., then subsequently switch to fraud.
  • Sellers can attempt to boost their own feedback by buying their own items with alias accounts, and leaving positive feedback for their main selling account.
  • Sellers can request feedback be removed and eBay will sometimes do so.
  • When eBay removes feedback, the buyer is not informed.

Requirement to use PayPal

In 2007 and 2008, during the period of eBay's ownership of PayPal, eBay required sellers to accept and buyers to pay with PayPal in many instances. This resulted in scrutiny by several regulatory agencies worldwide.[15][16][17][18] The company later changed its payment requirements.[19]

Agreement with Buy.com

In 2008, eBay reached a deal with Buy.com to list millions of items for sale by the retailer, angering sellers who faced additional competition.[20]

2010 survey criticizing eBay customer service

In January 2010, Auctionbytes.com held an open survey in which sellers could rate eBay, as well as competing auction and marketplace sites. In the survey, users were asked to rank 15 sites based on five criteria: profitability, customer service, communication, ease of use, and recommendation. eBay was ranked 13th, after other large sites such as Amazon.com and Craigslist, as well as lesser-known selling sites such as Atomic Mall, eCRATER, and Ruby Lane. In individual category rankings, eBay was rated the worst of all the 15 sites on customer service and communication, and average on ease of use. Some respondents stated they would have given eBay a rating of 10, three to five years ago. eBay was rated twelfth out of fifteen in the Recommended Selling Venue category.[21][22]

Overcharging fees

In 2011, eBay agreed to pay $30 million to settle a class action lawsuit alleging that it overcharged seller fees for sales of auto parts and accessories between April 2005 and August 2009. Members of the class received a refund of 6.67% of the fees paid in this category.[23]

Low tax rate paid in the United Kingdom

eBay has been criticized for arranging its affairs so as to pay a low level of taxes in the United Kingdom. The Sunday Times reported in October 2012 that eBay paid only £1.2 million in tax on sales of over £800 million in 2010. eBay responded that it "complies fully with all applicable tax laws".[24]

2014 security breach

On May 21, 2014, the company revealed that the consumer database of usernames, passwords, phone numbers, and physical addresses was breached between late February and early March. Users were forced to change their passwords. The Syrian Electronic Army took responsibility for the attack and said that it would not misuse the data; however, in a move of website defacement, replaced the front pages of the websites with their own logo.[25][26][27][28]

Stalking scandal

In June 2020, five employees were terminated and were subject to charges of cyberstalking after they were accused of targeting Ina and David Steiner, the editors and publishers of EcommerceBytes, a newsletter that eBay executives viewed as critical of the company. In addition to sending harassing messages and doxing, the defendants "ordered anonymous and disturbing deliveries to the victims’ home, including a preserved fetal pig, a bloody pig Halloween mask, a funeral wreath, a book on surviving the loss of a spouse, and pornography". The defendants also vandalized the couple's home in Natick, Massachusetts.[29][30][31][32][33] The conspirators pleaded guilty and most were sentenced to prison terms.[34] Wenig, the company's CEO at the time of the harassment campaign, who was frequently targeted by the newsletter and was described as having paranoia over the criticism, was not charged, instead leaving the company in September 2019 with a $57 million severance package.[35][36][37][38] Steve Wymer, chief communication officer, who had ties with local politicians, was fired "for cause" for alleged involvement but was not charged and was hired by the local chapter of the Boys & Girls Clubs of America.[39][40][41][42]

Sale of controversial items

Items prohibited to be sold on the website include illegal items such as child pornography, counterfeit products; or items that require licenses to sell such as tobacco, alcoholic beverages, firearms and ammunition, certain knives,[43] human body parts,[44][45] drugs, tarot readings and spells,[46][47] virtual in-game items;[48] as well as offensive items such as Nazi memorabilia, flags of the Confederate States of America, and used sex toys. Regulations vary by jurisdiction.

Human kidney

In late 1999, a man offered one of his kidneys for auction on eBay, attempting to profit from the potentially lucrative (and, in the United States, illegal) market for organ transplants.[49]

Animals

Two previously undiscovered species, including the Coelopleurus exquisitus sea urchin in 2006, have been listed for sale on eBay.[50]

Nazi memorabilia

In January 2010, eBay withdrew a listing of a Dad's Army board game since the box graphics contained images of swastikas, claiming that it was Nazi paraphernalia and, as such, breached the terms of service. eBay was accused of pandering to political correctness.[51]

Items stolen from the British Museum

Items stolen from the British Museum in 2013 were auctioned on eBay in 2016. The museum reported that several items of jewelry made of gold, semi-precious stones, and glass, dating from between 1,500 BC and the 19th century AD, were among those missing. One piece of ancient Roman jewelry made from onyx – valued between £25,000 and £50,000, or US$32,000 and US$63,000 – was listed on eBay with a minimum price of £40 (US$50) in 2016. There were no bids made for the treasure. The police are investigating this case.[52] The company said that it is supports local police in investigations and removes listings containing stolen property.[53]

Dr. Seuss books

In 2021, the estate of Dr. Seuss requested from eBay, and the company complied, to ban the sale of six Dr. Seuss books due to concerns that some images contained therein were racially insensitive. This led to backlash from followers of right-wing politics and ignited a surge of interest in the discontinued books.[54][55][56]

Sale of illegal items

In September 2023, the United States Department of Justice sued eBay, accusing it of violating the Clean Air Act and other environmental laws by allowing the sale of several illegal products, including devices that defeat automobile pollution controls, restricted-use pesticides, and paint and coating removal products containing methylene chloride.[57]

References

  1. ↑ Metz, Cade (10 July 2009). "Net sleuth calls eBay on carpet over shill bidding". The Register.
  2. ↑ Neeson, Johanna (September 1, 2023). "10 Most Common eBay Scams to Look Out For". Reader's Digest.
  3. ↑ Griškėnas, Saulius (August 16, 2023). "Exposing the top 10 eBay scams and how to detect them". NordVPN.
  4. ↑ Stouffer, Clare (July 20, 2023). "17 common eBay scams and how to spot them". Norton AntiVirus.
  5. ↑ "Counterfeit pcgs holders". Professional Coin Grading Service. March 27, 2008. Archived from the original on 2008-04-10.
  6. ↑ Hafner, Katie (November 27, 2007). "Tiffany and eBay in Fight Over Fakes". The New York Times.
  7. ↑ Stone, Brad (July 14, 2008). "Court Clears eBay in Sale of Counterfeit Items". The New York Times.
  8. ↑ Sommers, Mark; Kilaru, Naresh (May 2010). "The Second Circuit's Decision in Tiffany v. eBay". Finnegan, Henderson, Farabow, Garrett & Dunner.
  9. ↑ "Business | Court fines eBay over fake goods". BBC News. June 30, 2008.
  10. ↑ PARLOFF, ROGER (July 11, 2008). "eBay denied stay in LVMH case". Fortune. Archived from the original on February 15, 2009.
  11. ↑ Goodin, Dan (June 5, 2008). "French court fines eBay for sale of counterfeit handbags". The Register.
  12. ↑ "BBC, 5-Feb-2008, eBay to ban negative seller views". BBC News. February 5, 2008.
  13. ↑ Hansell, Saul (January 29, 2008). "Sellers Give Negative Feedback on eBay Changes". The New York Times.
  14. ↑ LaPlante, Alice (January 2, 2007). "eBay Feedback: Fatally Flawed?". Forbes.
  15. ↑ Foo, Fran (April 17, 2008). "ACCC puts eBay's PayPal plans under scrutiny". The Sydney Morning Herald.
  16. ↑ "RBA wary of eBay's PayPal push". Australian Broadcasting Corporation. May 8, 2008.
  17. ↑ Osborne, Darren (May 9, 2008). "eBay stands firm despite user discontent". The Age.
  18. ↑ Oates, John (April 26, 2007). "eBay, PayPal face court action". The Register.
  19. ↑ Moses, Asher (July 3, 2008). "eBay backs down on PayPal changes". The Sydney Morning Herald.
  20. ↑ Stone, Brad (July 14, 2008). "Buy.com Deal With eBay Angers Sellers". The New York Times.
  21. ↑ Steiner, Ina (January 24, 2010). "Seller's Choice: Merchants Rate Ecommerce Marketplaces". Auctionbytes.com. Archived from the original on June 29, 2010.
  22. ↑ Steiner, Ina (January 24, 2010). "Seller's Choice Marketplace Ratings: eBay". Auctionbytes.com. Archived from the original on July 10, 2010.
  23. ↑ Mirando, Sarah (January 14, 2011). "eBay Motors Fee Class Action Settlement". topclassactions.com.
  24. ↑ "EBay 'pays £1.2m in UK tax' on sales of £800m". BBC News. October 21, 2012. Archived from the original on November 27, 2020.
  25. ↑ Pagliery, Jose (May 21, 2014). "EBay customers must reset passwords after major hack". CNN. Archived from the original on November 12, 2020.
  26. ↑ Molina, Brett; Weise, Elizabeth (May 21, 2014). "EBay urging users to change passwords after breach". USA Today. Archived from the original on March 18, 2020.
  27. ↑ Finkle, Jim; Freifeld, Karen (May 21, 2014). "EBay asks 145 million users to change passwords after cyber attack". Reuters. Archived from the original on February 22, 2016.
  28. ↑ "eBay Suffers Massive Security Breach, All Users Must Change Their Passwords". Forbes. May 21, 2014. Archived from the original on November 12, 2020.
  29. ↑ "eBay Inc. Issues Statement Regarding Indictments of Previously Terminated Employees" (Press release). PR Newswire. June 15, 2020. Archived from the original on December 6, 2020.
  30. ↑ Robertson, Adi (June 15, 2020). "Former eBay security director arrested for harassing journalist with live cockroaches". The Verge. Archived from the original on November 6, 2020.
  31. ↑ "'We are going to crush this lady': Six former eBay employees charged in federal cyberstalking case targeting Natick couple". The Boston Globe. June 15, 2020. Archived from the original on October 27, 2020.
  32. ↑ "6 eBay Employees Charged With Sending Bloody Pig Mask To Natick Couple". WBZ-TV. June 15, 2020. Archived from the original on December 15, 2020.
  33. ↑ "Six Former eBay Employees Charged with Aggressive Cyberstalking Campaign Targeting Natick Couple" (Press release). United States Department of Justice. June 15, 2020. Archived from the original on December 13, 2020.
  34. ↑ "Former eBay Employee Sentenced for Aggressive Cyberstalking Campaign" (Press release). United States Department of Justice. November 3, 2022.
  35. ↑ Durkin Richer, Alanna (June 15, 2020). "Feds: eBay staff sent spiders, roaches to harass couple". Associated Press. Archived from the original on December 15, 2020.
  36. ↑ Heater, Brian (June 15, 2020). "US attorney details eBay employees' harassment campaign, including live roaches and a pig fetus". TechCrunch. Archived from the original on December 18, 2020.
  37. ↑ Streitfeld, David (September 26, 2020). "Inside eBay's Cockroach Cult: The Ghastly Story of a Stalking Scandal". The New York Times. Archived from the original on September 26, 2020.
  38. ↑ Kwan, Campbell. "Four former eBay employees set to plead guilty to cyberstalking charges in US". ZDNet. Archived from the original on October 20, 2020.
  39. ↑ "Investigation continues after couple became the target of harassment, stalking by eBay employees". CBS News. March 26, 2023. Archived from the original on April 16, 2023.
  40. ↑ Howeyand, Brian; Nguyen, Tran (January 4, 2023). "Disgraced eBay exec wielded power at San Jose City Hall". San Jose Spotlight. Archived from the original on April 11, 2023.
  41. ↑ Streitfeld, David (September 16, 2022). "At eBay, Lurid Crimes and the Search for Punishment". The New York Times. Archived from the original on March 28, 2023.
  42. ↑ "Boys & Girls Clubs of Silicon Valley Names Steve Wymer President and Chief Executive Officer" (Press release). September 10, 2020. Archived from the original on March 28, 2023.
  43. ↑ "eBay bans trade in knives in UK". BBC News. February 9, 2008. Archived from the original on June 11, 2011.
  44. ↑ Diekneite, Max (July 13, 2016). "eBay bans sale of human skulls". KTVI.
  45. ↑ Vergano, Dan. "eBay Just Nixxed Its Human Skull Market". BuzzFeed News. Archived from the original on July 13, 2016.
  46. ↑ Lardinois, Frederic (August 20, 2012). "Ebay Bans The Sale Of Spells, Potions And Psychic Readings". TechCrunch.
  47. ↑ "tarot readings and spells". BBC News. August 20, 2012. Archived from the original on October 17, 2012.
  48. ↑ Anderson, Nate (January 30, 2007). "eBay bans the auction of in-game items". Ars Technica. Archived from the original on December 12, 2010.
  49. ↑ Harmon, Amy (September 3, 1999). "Auction for a kidney pops up on Ebay's site". The New York Times. Archived from the original on November 8, 2020.
  50. ↑ O'Brien, Helen (August 17, 2006). "New urchin leaves eBayers all at sea". The Guardian.
  51. ↑ Palmer, Richard (January 29, 2010). "Dad's Army board game banned 'for being racist'". Daily Express.
  52. ↑ "Stolen British Museum jewelry worth US$63,000 sold on eBay for US$50". South China Morning Post. August 19, 2023.
  53. ↑ Harris, Gareth (August 18, 2023). "Media reports identify objects allegedly stolen from British Museum and posted on eBay". The Art Newspaper.
  54. ↑ Trachtenberg, Jeffrey (March 4, 2021). "Dr. Seuss books deemed offensive will be delisted from eBay". The Wall Street Journal.
  55. ↑ Crowley, James (March 4, 2021). "eBay is removing listings for discontinued Dr. Seuss books citing 'offensive materials policy'". Newsweek.
  56. ↑ Tweedie, Steven (March 5, 2021). "eBay is removing listings for the Dr. Seuss books that the author's estate pulled due to their racist imagery". Business Insider.
  57. ↑ Stempel, Jonathan (September 27, 2023). "U.S. sues eBay over sale of harmful products". Reuters.
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