EcommerceBytes-NewsFlash, Number 323 - May 24, 2002     1 of 3

eBay PowerSeller Arrested for Grand Larceny and Scheme to Defraud

By Ina & David Steiner

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Victor Montanez thought he was buying a Bose DVD-based home entertainment system on eBay. What he ended up with was a headache.

In February, Montanez sent a cashier's check for $1,844.99 to Neil Bansal, an eBay PowerSeller, for his newly won system. After many weeks and many excuses from the seller, Montanez began to feel that he was being strung along. "He kept emailing me and telling me there were delays, or offering different colors and models," said Montanez. "When I finally said I wanted my money back, I never heard back."

Apparently, neither did more than 30 other eBay buyers.

According to the New York county District Attorney's office, 32 complaints, totaling more than $50,000, have been lodged against Mr. Bansal, aged 23, of New York City. Bansal was arrested in his home on May 13 and charged with one count of 2nd degree Grand Larceny and one count of 1st degree Scheme to Defraud. He was released on his own recognizance. If convicted, he faces the possibility of 15 years in prison.

The complaint states that 32 people won eBay auctions from Bansal for Sony Vaio Laptops, Pioneer Plasma televisions and Bose Speakers between November 2001 and March 2002. Although they sent money using checks and online-payment service PayPal, the complaint alleges that Bansal never sent those customers their goods.

David Gordon, Bansal's attorney, maintains that his client is not guilty of the charges and is attempting refund all parties involved. "He was purchasing items from a reseller who stopped delivering. Everyone who has sent money and who has not received their items will get a refund." Bansal bought his merchandise through J.C. Morris & Co in Atlanta, according to Gordon.

Gordon said his records will prove that Bansal had ordered all of the items from J.C. Morris & Co. and has proof that his client had sent money to the distributor. "He [Bansal] paid the company for Sony laptops, Palmtops and Bose Sound systems," said Gordon. "Everything was fine until J.C. Morris stopped making deliveries."

A notice on the J.C. Morris & Co. Web site ( yesterday stated that the company would be filing for bankruptcy on May 29. Attorneys for J.C. Morris & Co. did not return phone calls for this story. Gordon said his client had filed a complaint against J.C. Morris & Co. with the FBI, FTC and the Better Business Bureau of Atlanta on April 24.

Bansal sold on eBay under the name shakes955, an ID that was registered on eBay on August 1998. Victor Montanez said he did his homework before bidding on Bansal's auction. "Shakes955" had 188 feedbacks and was an eBay PowerSeller. "I reviewed the feedback, and he seemed like a reputable dealer," Montanez said.

eBay has had several high-profile cases of fraud on its site recently. In February, authorities cracked a glass shill-bidding ring on eBay involving over $1.3 million in high bids. In March, a long-time eBay seller disappeared after bilking buyers out of over $300,000. According to eBay spokesperson, Kevin Pursglove, "You have to keep it in perspective. Confirmed cases of fraud on eBay are less than 1/100 of one percent."

To attempt to reduce fraud even further, eBay recently formed an alliance to use VeriSign's Authentication Service Bureau (ASB) to authenticate new eBay sellers during the registration process on its site.

And what about Victor Montanez? To Victor went the spoils. He eventually ended up buying his Bose system from another eBay seller. The transaction went smoothly, and he still hopes to recover his $1,844.99.

About the author:

Ina and David Steiner are publishers of and have been writing about ecommerce since 1999.

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