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eBay fail to stop PayPal email payment address scam as more sellers lose thousands

By Chris Dawson September 2, 2019 - 8:00 am

eBay have failed to shut down the scam where sellers’ PayPal email payment address is changed diverting funds into scammers accounts. This weekend, yet another seller contacted Tamebay having fallen victim to the scam in what’s becoming a steady trickle of devastated small business owners.

The scam goes like this: At some point a seller account on eBay is compromised. The scammer checks the PayPal email payment address, buys a URL with a similar (usually only one letter different) address and sets up an email address. The scammer sets up a PayPal account with the fake email address. They then go back into eBay, pick a few listings with relatively low value but high sell through rates and change the PayPal email payment address to the fake one. They then sit back and watch the funds roll in.

The daily take rate may be low but over months the sums add up and thousands of pounds are stolen. In the latest case, the seller lost £14,000 from a total of 3260 transactions over a four month period.

The human cost of fraud

This is no victimless fraud and is taking a heavy toll on the sellers who are being scammed. In this latest case the seller was losing all faith in his business plan and pouring money into the business to keep it afloat. The seller was questioning why they were doing everything right but at the end of the month the predicted funds simply weren’t there.

Why haven’t eBay taken action to stop this PayPal email payment address fraud?

It’s been a month since we first reported on the case of Richard Crisp who lost £54,000. Since then we’ve heard of several other cases so the question has to be asked why haven’t eBay taken action, especially as we know this scam has been taking place since 2017. That’s two years that eBay could have taken action.

Why are there no alerts when a PayPal email payment address is changed on active listings? Why is there no warning on the seller dashboard? What are eBay doing to prevent this from happening to you? Or is it already happening to you and you just aren’t aware you’re being scammed?

The question every seller that has contacted us is asking is why have eBay done nothing to stop this happening and when will they take action?

eBay blame PayPal, PayPal blame eBay. Neither take responsiblity

In the latest incident, as is always the case eBay refunded the fees associated with the hacked listings and directed the seller to PayPal to recover the funds. PayPal washed their hands of everything saying “I would suggest you push a bit harder on eBay, the fraud happened on their site (you can’t add a PayPal email address to an eBay listing via PayPal, it has to be done with eBay), regardless of the bank that processed the funds. PayPal process the funds according to what email address we’re told to send the funds to by eBay.

eBay also refuse to take responsibility saying “I would advise you to insist on pursuing PayPal as they are the people who hold control of the money. eBay never handle transactions.

PayPal watch the money go missing

In this latest case, the seller was in contact with a buyer who supplied some details from the payment that went to the scammer. When PayPal were contacted there will still funds in the fraudulent account but rather than freezing the account PayPal left it live, the account finished verification and PayPal then paid out the funds to the scammers account!

What about consumers’ personal information?

Apart from the continual fraud which is adding up to 100s of 1,000s of pounds, possibly millions, there is another aspect to this organised crime which hasn’t been considered. What is happening to the personal details of the consumer victims who have unwittingly paid scammers?

Consumers are sending payments to scammers including their PayPal email address, their home address and a record of the item that they have purchased. We don’t know and have no way of telling if this personally identifiable information is being added to scam lists to target them in future, but by not shutting the scam down eBay are allowing the personal details of innocent consumers to be harvested.

It’s likely that the primary aim of these scams is to illegally steal large sums of money. As a side line, they are also gaining a list of thousands of innocent consumers.

Are you a victim? Get in touch with Tamebay

If you have discovered this fraud on your account then please get in touch. We will if you wish keep your details confidential but we would like to assess the scale of this fraud and all indications suggest that this isn’t just a handful of cases perpetrated by a bedroom hacker. This is a highly sophisticated fraud being run by criminals.

  • Ian
    2 weeks ago

    Please can anyone suggest a quick and simple way to check hundreds of eBay listings for the correct payment email address? Aside from going into each one?

    • simon
      2 weeks ago

      Ian,

      You are better off bulk changing the email address of all of your listings to the correct one as it’s far quicker. You won’t find out if you have been scammed but by doing this on a regular basis you can be sure that payments are going into your account.
      I too was scammed by this over 4 years ago (and it was reported to both eBay and Paypal). Amazing that they have still done nothing about this as they have been aware for years!!

    • 2 weeks ago

      Sadly there’s a limit of 200 on bulk edit – not very useful if you have 1,000s of listings!

      In the mean time here are some steps you can take to protect your account although they are by no means fool proof

  • Dan
    2 weeks ago

    if we have just one payment policy are we good to go? for example if someone changes a paypal address on one listing with they need to create a new payment policy meaning that it could be spotted under business policies?

    It would be helpful if Tamebay could verify some checks or process that would enable us all to check this

  • David
    2 weeks ago

    All every seller needs to do is to check their business policies on a daily basis, this is found under account settings

    If you check the payment policies (most of us will only have the one) you can tell at a glance if there is an issue for example 2nd policy that should not exist.

  • Dan W
    2 weeks ago

    The responses from eBay and PayPal are unsurprising but breathtakingly complacent. And considering eBay wants to take on the mantle of Managed Payments, their response is particularly worrying and dismissive.

    PayPal seem to have been alerted to fraud on their platform and hold the information necessary for investigation and are supine.

    A ‘you have changed the payment method on one of your listings’ or ‘your account has been logged into from a new location/device’ email seems vital similar to those employed by Facebook, Google, Apple etc.

    • Alan
      2 weeks ago

      A ‘you have changed the payment method on one of your listings’ or ‘your account has been logged into from a new location/device’ email seems vital similar to those employed by Facebook, Google, Apple etc.

      Exactly this. With the amount of emails being sent by ebay, it couldn’t be all that difficult to send a notification email, or even a verification email when a business policy has been changed, assuming one is using business policies.

      Other marketplaces make it very difficult to update payment information, which can be a nuisance when the change is genuine, but seems to be the right way about it.

  • Payment Policies won’t help if you don’t use them. We don’t use (and never have used) business policies and they are currently not being supported by eBay so if you are not using them already you can’t set them up. All our listings have the PayPal address in the individual listing making it a pain to update several thousand listings on a regular basis.

    All of that is incidental to the real point and that is that it is an absolute disgrace that eBay let this continue. By their inaction they are complicit in this fraud.

    Since the article written by The Mail Online I have been contacted by several other victims. I actually spoke to the owner of the business concerned in this latest example on Friday. How many more must there be before anything is done?

    As an update on my case:

    I was contacted by another seller who had lost £11k in just under 2 months earlier this year and he gave me a list of eBay executives to try e-mailing. This seller got a response from the office of Wendy Jones (Senior Vice President of Global Operations) and apparently they were very helpful and covered the sellers cost of processing the lost sales. Which was interesting to learn!

    I did the same thing and got a very swift response from ebay Executive Escalations. I was called on a Saturday afternoon just an hour after sending the e-mail and subsequently received several follow up e-mails. I must admit I was quite hopeful when I received a call from them on Friday.

    I actually for a minute thought that they were going to do something but alas it was not to be. eBay again confirmed that they won’t be doing anything to help me. They wouldn’t comment on why they covered the other sellers costs and had no intention of doing the same for me.

    The fight goes on.

    • 2 weeks ago

      @Richard.

      How can you not be using business polices, I thought it was a built in system for ebay shop users?

      https://www.bizpolicy.ebay.co.uk/businesspolicy/manage

      Both my accounts have them, but I don’t have them on my personal account.

      These may have been created by my listing software as I did not create them.

  • Correction: It seems that I didn’t talk to the seller involved in this article it was another seller who it seems by sheer co-incidence also lost £14k! Wow

  • Toby
    2 weeks ago

    Ebay and paypal doing nothing….? Thank god in this world of fast moving change, somethings don’t. It would be a nice if it weren’t so worrying and costly. Sadly it is just one of many examples of ebay not taking fraud and its sellers / customers seriously. Sooner of later a big legal challenge is going to take place and personally i shall be clapping until my hands hurt when it does.
    Toby

  • @Tyler If I click the link you provided we get the message:

    There was a problem with business policies
    Please try again in a few moments. If that doesn’t work, review our Help site to learn how to contact Customer Service.
    If you want to stop using business policies, you can opt out now.

    Haven’t been able to set them up for well over a year now. Concierge just say that it isn’t supported.

    • 2 weeks ago

      @Richard, sometimes I struggle with that link, this one usually works.

      https://www.bizpolicy.ebay.co.uk/businesspolicy/manage?&ssPageName=STRK:ME:LNLK

      I was not aware that you could opt out.

      My other account I only set up 3 months ago and has Business policies, although I could not access them for about two months.

      Mine may be created by the listing software I use, as I did not create them myself.

    • 2 weeks ago

      Only a small part and probably really stupid but! spoke to Ebay as exactly the same message on my screen now. “Problem please try again later”, turns out it was a cache problem in the background. Cleared cache and all is fine.

      Hope this helps someone and really feel for you and others actually affected by this.

  • Mark
    2 weeks ago

    I recntly attended an online fraud seminar and we were constantly told that when this type of thing happens you were to blame.

    The scammers do not hack ebay or they would do it to a million accounts at a time.
    They target you as an individual and you respond giving them all the access they need.
    A friend just this saturday had his pc start up with a picture saying microsoft has intercepted a virus on this computer and it is locked please call us to advise how to remove it.

    Well he did and he was kept on the phone clicking this and that with them for 2 hours and then they said they would call back. he then got a text from his banks one after the other saying did you authorise this transaction if not call this number when he rang they said sorry its too late.

    It was inheritance from his mother in 3 accounts over £120,000 in total the poor old boy is 71 year old and at his wits end.

    he said why did my anti virus not find it. The reason is there was no virus just a pop up.

    You were then the problem when you called them and followed their instructions.

    A simple ctrl alt delete showed the process running and could end it then control panel and remove the named program all sorted.

    we receive multi emails every day from Amazon ebay and many other places just look at the properties.

    scams all of them buyt they all require one thing.

    Your assistance,

  • Bill
    2 weeks ago

    Absolutely agree with you Mark but on this occasion Ebay new it was going on (have known for 2 years)so why did they not inform there global audience and please read the story that was printed Ebay and Paypal were informed and nothing was done to stop it happening on there end.

    This fraud is at another level a complex one which could easily have been stopped from happening and now lets really focus on what happens to the unexpected customers that willingly gave there details to the scam!!!!

    This is an absolute story on how the big companies that have a global reach can do to a small company and the take no responsibility at all to resolve the matter as long as they make a profit who cares.

    • Bozo
      2 weeks ago

      I think by ‘You’ Mark really meant you, as in us, not Ebay.
      You can’t really fault the company if some hacker gets a hold of your own email account, and also notices you have ebay account and proceeds to scam it.

      Every individual has to be responsible for his own email account, and any other account online. If you log into your Ebay account in a public place, or click some phishing links through a dodgy email – who’s fault is that? The fact that you haven’t changed your password in 2 years to something more complex, are you going to blame Ebay for that as well?

      There is a line the company must draw. After all, I got hacked online (not on ebay) just by purchasing something with my debit card on some other platform. Am I blaming the platform? No. I got sloppy by not being careful. Mind yourselves in the digital world.

    • 2 weeks ago

      @Bozo You are right about the responsibility of users and their accounts but…

      eBay also have a responsibility to protect their users and they have failed to do so.

      The most basic of web scripts these days has an email notification to confirm you have changed your email or password, even eBay has it built into the login system, so could have easily applied it to the change of payment details within 24/48hours of it being warned of this fraud.

      Not only did they ignore the problem then they have still done nothing about it.

  • Yadvak
    2 weeks ago

    Some comments have been suggesting that everybody has to be responsible for their own email account and putting the blame on phishing.

    My own experience suggests otherwise and that something sinister is going on.

    A dormant email account was hacked and the only thing they could do was to use it for spamming.

    I feel sorry for the people who know they have lost money. I feel really sad for those who are losing money and are completely unaware of it. I am lost for words for those people who will lose money in the near future cause of EBay and PayPal’s atrocious response.

    Until and unless, these two companies do something, it appears that constant vigilance is required.

    Ebay has known about this for 4 years and appear not to have any concern for their sellers. This shows that sites like Tamebay are absolutely necessary

  • @Bozo I don’t think anyone will argue with anything that you or @Mark have said about all our own responsibility for our own online security. That is a given but once the fraudster has changed the PayPal address in a listing you can change your password every 5 minutes and it won’t make any difference.

    However your comments are missing the point and that is that eBay (and PayPal) have been aware of this exact fraud for over 2 years and they have done absolutely NOTHING about it. This is not just a platform. This is a place of business, a place we pay significant fees to use (£9k last month), a platform that has a Seller Protection team that according to their You Tube Video are working 24/7 to protect us. Its not a platform we use occasionally it is our living.

    There were No warnings to sellers and they have done NOTHING within their platform to alert sellers that a PayPal address has been changed. They are 100% complicit in this fraud because of their inaction.

  • 2 weeks ago

    PayPal: Why do people constantly claim that PayPal are at fault?

    It has nothing to do with PayPal, much the same as if funds were sent to a high street bank, they are just a receiver of funds into, what should be, a legitimate account.

    There are also many other on-line accounts that some platforms use like Payoneer, Stripe, Google Pay etc, if eBay had any of these we could activate it would be the same situation, but it does not make them responsible.

    This is completely an eBay problem.

    If somebody has created a fraudulent PayPal account, then yes they need to account for how that happened. But that is a totally separate issue.

    The issue of money being in an account and failing to freeze it is complicated and does depend on how it was reported and who by. If an individual makes the claim to PayPal about what is considered to be a legitimate account, how are they meant to act?

    They could freeze the account but this could take several weeks to look into, suppose the claim was false and this happened to your business? Imagine you were turning over £100,000+ a month and could not access your account for a month or longer.

    But like I said above, this is a completely different problem, the lack of security on eBay is the problem and the failure to act once the scam came to light.

    • 2 weeks ago

      PayPal do have some questions to answer. Firstly I agree with you that the fraud didn’t take place on PayPal. However they have failed to explain their account verification and more importantly how these accounts are passing European Money Laundering checks which kick in after €2800 has been processed.

      If the checks are being passed because these are real people then pass the information to the Police. If fake details are being used then their checks are worthless.

    • 2 weeks ago

      @Chris Dawson: I know as a “journalist” you believe that you have a right to know whatever information you want from who you want, but in the real world it does not work like that.

      Even when you say they should “pass the information to the Police”, this is true but they will only do this when the police request it, not because some individual has reported it to them, or are you suggesting that they refused to give the police the information?

      And even then I am not sure if the police can just make the request or if a Judge / Magistrate would need to authorise it.

      Frustrating as it is there are laws that cover these type of things and protect criminals data.

  • 2 weeks ago

    @Tyler Agreeing with you. In the past I was in the flight game with credit cards being the norm. The police have to make a formal request in writing in line with the data protection act, then the information can be passed across. Based on that I would think that the Paypal cannot pass the information across without a request. don’t remember seeing judge signatures or similar.

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