An Amazon buyer has been indicted
after Feds accused him of committing fraud using 501 allegedly false Amazon accounts to place approximately 1227 orders. The government alleges he obtained over $200,000 in merchandise, replacements, and refunds by falsely claiming the merchandise had not been delivered or was damaged.
While an indictment is an allegation and is not evidence of guilt, the very idea that it might be possible for a single buyer to commit $200,000 in false claims is breathtaking to small sellers who sell on Amazon, eBay, Etsy, and elsewhere.
It's especially problematic given that marketplaces mandate sellers offer generous returns policies.
It also calls into question eBay's new Service Metrics policy that went into effect on October 1, 2018, in which eBay charges 40% higher fees to sellers who have too many SNAD claims ("How often you receive return requests for "items not as described.") Rather than using only cases where the seller has actually lost the claim, eBay uses the rate of *all* Item Not as Described requests (even those where the buyer has lost the case) and compares it with the seller's peers to determine if the rate is too high.
that it all ends up fair because all sellers are equally impacted by bad buyers and fraudsters. But that's small comfort to sellers who have the bad luck of being victimized by more bad buyers or fraudsters than their colleagues. In such cases, first they get defrauded, then they incur penalty fees from eBay.
Will sellers be protected from fraudulent buyers and false "item not as described" claims?
When buyers get flagged as fraudulent and/or abusive and we believe all of the claims were filed in bad faith, we will remove the transactions from seller calculations. For false "item not as described" we will NOT remove potentially mis-filed returns where we don't see a history of likely intentional mis-filing. All sellers experience these randomly, and peer benchmarks reflect that they happen at a certain rate on average. We want sellers to focus on reducing the preventable returns and not worry about disputing every claim.
What's sorely lacking from the equation is the incentive for eBay to curb returns abuse.
While the above allegation against the Amazon buyer is disturbing, it doesn't come close to a case we wrote about in October
in which a husband and wife were charged with defrauding Amazon of over $1.2 million through returns fraud.