Mark's Notebook


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Thieves Find Exactly What They're Looking for on EBay

Washington Post

Thursday 6 January 2005, 4:06 pm
Keywords: Computer Topics , News Articles

Auction Site Used to Cash In on Stolen Goods

By Ariana Eunjung Cha

SAN JOSE -- The ring of young men and women had become pros at snatching cashmere sweaters, perfumes and other expensive items from the likes of Abercrombie & Fitch, Victoria's Secret and Pottery Barn.

The shoplifters discovered some stores would allow them to return the goods without receipts for store credit or gift cards. They then sold those vouchers on the giant online marketplace EBay. It was easy, instant and anonymous. The money flowed in -- they got 76 cents per dollar of stolen merchandise, a huge takeaway considering that shoplifters traditionally net 10 percent or less of the retail value of the items. The group made more than $200,000 in 10 months.

Breaking up the store-credit-for-cash scheme involved a massive, year-long sting that took authorities across five Northeast states and required them to mine hundreds of computer files, conduct secret surveillance at stores and place an agent undercover to infiltrate the ring.

The Federal Trade Commission last year received a record number of complaints related to Internet fraud. Half of the cases involved online auctions.

A group of amateur motorcycle thieves from Austin filched nine bikes and sold them to a man who took them apart and auctioned off the spare parts online. A wife-and-husband team from Atlanta removed the bar codes from low-cost items and put them on expensive rugs that they purchased from Home Depot and Lowe's stores. They then returned the items, accepting gift cards for the real price of the merchandise, often hundreds of dollars more than they paid. They then would sell the gift cards on eBay.

EBay spokesman Hani Durzy said that most auctions proceed without problems but that the company estimates a minuscule number -- 0.01 percent -- are fraudulent. But with 30 million auctions happening on any given day, even 0.01 percent means at least 3,000 could involve some sort of crime.

http://www.washingtonpost.com/wp-dyn/articles/A51741-2005Jan5.html