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Wed Oct 7 2009 16:15:08

Online Sellers Receive Spam Advertising Xcoin Payments

By: Ina Steiner

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Online sellers reported receiving Spam emails this week that advertised an online payment service called Xcoin. The mailings addressed recipients in the subject line as sellers on various marketplaces, including our merchant directory, EveryPlaceISell.com (EPIS).

On Sunday, an online merchant who sells on a number of marketplaces sent me an email with the subject line "Attention Ecrater Seller : Special Promotion." I didn't think much of it, and like her, I assumed that the two companies - eCrater and Xcoin - were working together. (I could not have been more wrong.)

On Tuesday, David received email with the subject line, "Attention Every Place I Sell Member : Special Promotion." (See screenshot image.) An EPIS merchant forwarded to me the same email she had received and asked, " Is this email sent with your knowledge and approval?" Anyone who knows how we fiercely protect our list of AuctionBytes subscribers and EveryPlaceISell.com merchants can imagine how upset this made us.

We sent an email to EPIS merchants letting them know we had not given anyone our permission to send merchants such an email, and to beware. Some responded, letting us know that they had gotten some of these emails, including subject lines referencing EveryPlaceISell, eCrater, and Bonanzle.

I double-checked with eCrater and Bonanzle, they said they had no knowledge of these emails and they also had nothing to do with them.

A seller who was discussing it on one online forum said the various pieces of information in the email she received were scrambled - "the spammers headed the letter "Attention Bonanzle Seller," sent it to the @info address of my own website, and the greeting was to my EPIS username."

Did Xcoin send the emails? We're still waiting for an answer from the company.

The "contact us" page on xcoin.com is simply a web form. I looked up the phone number in the WhoIs database and left a message on the answering machine last night (no one called back).

Then I wrote to ceo@xcoin.com, unsure if that email address would work, and said "I'm working on a story about xcoin, how do I reach you asap?"

Ken Sproule (ksproule@xcoin.com) wrote back and said:

I am pleased to make the contact with you and Auction Bytes. Currently I am on the road but will gladly coordinate a time for us to talk or I can answer any questions you have through email as you prepare your article on Xcoin. When would be a good time for you to talk?

One bit of great news for sellers is the special transaction rate of 1.8% we are offering through to January 1st, 2010.

I look forward to speaking with you.

I wrote back that "I'm concerned about the approach xcoin has taken in marketing the promotion to online sellers via unsolicited email, can you explain this strategy to me?"

I've yet to hear back from him.

The FTC sets out clear directions for sending email to comply with the CAN-SPAM law. Two big violations in this email campaign are "Tell recipients where you're located" (there's no address in these emails), and "Tell recipients how to opt out of receiving future email from you" (again, no such link included in the email.)

Finally, the FTC says:

Monitor what others are doing on your behalf. The law makes clear that even if you hire another company to handle your email marketing, you can't contract away your legal responsibility to comply with the law. Both the company whose product is promoted in the message and the company that actually sends the message may be held legally responsible.

Update 10/9/09: I spoke to Ken Sproule, co-founder of Xcoin, this morning and asked him where he got the email addresses and whether he would be continuing to send emails to the list of sellers.

Sproule said his marketing department identified 2500 sellers that have product listings on a number of different portals found through PowerSellers Unite, such as Bonanzle, and then went to the sellers' own websites to make sure the website was the kind of business they would like to offer this promotion to and to obtain their contact email address.

His marketing team spent a month or so going to those websites to look at the business they were in to see if it fell within Xcoin's terms of use, and looked at the ones that sold on multiple channels and were strong in various categories, and gathered email addresses.

"You brought to our attention a couple of mistakes we made on that email. Thank you very much for that. We've gone back and corrected that now. That got by my desk, and that was my mistake, and I do apologize for that. We wanted to offer a small group of sellers this promotion of a very reduced rate and get a reaction from the marketplace and see how the sellers felt about having a very low rate through the Christmas season."

Sproule said Xcoin came out with the service four years ago. "We also learned some hard lessons when success came along, and that is you have to have a very robust customer service department, we had to have a very good risk-management department in place, and these were key parts of the company we didn't have at that time."

"We made the decision to rebuild the service, make it a lot easier to use, make it robust. We put in a very large customer service department, marketing department, and we also put a very robust risk management department as well. We stopped all of our marketing initiatives a few years ago, we rebuilt everything and repositioned ourselves." He said they just turned the service back on 4 or 5 months ago.

All of the emails that were sent were signed by employees in his marketing department, he said, and said right now there are no plans to send more emails to the list.




Comments (10) | Permalink

Readers Comments

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: bits

Wed Oct 7 16:55:00 2009

Hi Ina: I also received this email as a Bonanzle seller.  I was curious and went through the terms and found several typos and one part where the phrasing was the exact opposite of what I'm sure they meant.  That did not give me any confidence in this service since I would assume that all terms and conditions in the contract you enter into with them when you sign up, has been vetted by a lawyer. Made it look like phishing.

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Patricia

Wed Oct 7 19:02:26 2009

I never received such an email.  If so, it would have been permanently blocked because I never deal with unsolicted spam and I never will deal with them.

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Go away, Spammers

Wed Oct 7 22:13:37 2009

Yeah we got it & promptly reported them to our ISP. Like we're going to give our info to a company that is obviously NOT in the US, and can't even spell?

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Henrietta

Thu Oct 8 01:24:25 2009

They have been around a long time.
Spam issue aside, I would not deal with any entity that has:
1. No legal address information on site
2. No indication of which state it is incorporated in
3. What states is it licensed to do business in?
4. No means of contact other than a webform

Get real Mr Sproule. You are not licensed as a money transmitter in my state.

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: cb on bonanzle

Thu Oct 8 06:05:01 2009

I would like to see the full headers of the emails so that the ip number can be traced.

If the emails were sent directly from xcoin's domain/webhosting for sure, then that's just really and truly bad on xcoin's part.

In seeing on the xcoin site that they have an "affiliate program", I am betting that a spammer wanted to earn money through their affiliate url.

I never received such email. Wish I did so that I can trace it and I can tell you for sure if it was either xcoin or a slap happy affiliate spammer that sent it.

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Dan

Thu Oct 8 23:32:51 2009

I received this email too, I think you got my email from other merchant service provider, and I just signed up as member,I don't think this a spam mail, I have reply that email and got reply directly..

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Desperate?

Fri Oct 9 00:00:47 2009

What a piece of garbage! I received this email as well. I did a bit of investigating myself and found that this so-called Paypal alternative to high fees is BS.

Did anyone check the rates AFTER the promotion?

Accepting payments from buyers within your home country:
3.9% + $0.30 - business is: 2.9% + $0.30

Accepting payments from buyers outside your home country:
4.9% + $0.30

Sorry spamcoin, gotta do better than Paypal and Google - before, during and after.

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: Gailete

Fri Oct 9 09:49:16 2009

Got one of these as an ecrater seller. As ecrater at this point has no way to use xcoin, I knew they were up to no good and deleted. I don't sign up for the first money program I see on the internet. I had never heard of them and this, theie introduction to society again after 'cleaning' up there act doesn't inspire much confidence! I will also stick with Paypal and Google Checkout!

Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: fruity

Fri Oct 9 20:18:26 2009

I'm going to go pull up your life and you better pray I don't find anything or you're going to be wearing an orange jumpsuit just like egold!


Online Sellers Receive Spam Advertising Xcoin Payments   Online Sellers Receive Spam Advertising Xcoin Payments

by: spicy onobis

Sun Oct 25 07:36:27 2009

I guess all of these information that we received from xcoin proclaimed is just only trash. merchant(s) must be keep an eye of them.



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