I have observed a lot of eBay scams going on over the last year. Here are a few that you should look out for.

1) Get iPods, iPhones, computers, LCD tvs etc for free. These listings usually say “DO NOT BID”, that the listing is just to inform the reader how to get these items for free. The catch is that the reader has to sign up for a bunch of trial offers, and then sign up 6 or 8 more people to do the same. It is a pyramid scheme and eventually there is no one left to sign up. Pyramid schemes are illegal according to the Federal Trade Commission. What the seller really meant was that the purpose of the listing was to get the seller an iPhone for free.

2) Picture Scam. The seller is actually selling you a picture of the item, not the item itself. This fact is usually disclosed in very small print somewhere in the listing. A variation on this scam is to list the box the item came in instead of the item itself.  Its amazing how many bidders miss this trick. Pure dishonesty. This scam is less frequent, as the seller is soon discovered by eBay and his listing rights revoked.

3) Raffles. Raffles are against eBay rules, but sellers do it anyway. Usually the seller is selling a large quantitiy of envelopes or eCards which have a prize in them. Often the prize is a Wii, or XBox, or some other expensive piece of electronics gear, and to further entice the buyer, the seller will state that every envelope is a winner with a cash prize. Of course, the cash prize is a very small amount, refunded through paypal. It seems no one ever wins the Wii or whatever the grand prize is supposed to be. Probably the seller does not even have one to give away, and there is no way for a buyer to know. The seller can always claim that not all the envelopes were sold, and the winning envelope was not drawn. The seller rakes in a lot of profit with very little expense.

4) Mystery auctions. Here, the seller hints that an envelope or a box contains some expensive prize but firmly states that the bidder is only bidding on the box with anything inside being a gift. Of course, the box actually contains a dirty sock instead of the Apple Laptop that was hinted at. Mystery auctions are banned on eBay, but they can be found any day of the week. A highly lucrative mystery auction for the seller is the mystery gift card. The seller lists a Walmart Gift Card, or one from some other store, claiming that the amount on the card could be anywhere from $5.00 to $500. Can you guess what the amount is? I can! Often, the seller states that they got the card as a gift and they do not know the value of the card. If it were my card, I’d go down to Walmart and ask; wouldn’t you?

It is simply amazing to me how many people fall for these scams. Recently, I saw an auction that listed an iPod box for sale. That’s right, it was just the box that an iPod came in. The listing clearly stated that it was only the box, and yet it sold for $173.00 Apparently, reading comprehension is no longer taught in schools. A bad seller feedback rating does not seem to stop the buyers either. It seems the lure of getting an Xbox for $2.00 completely turns off the buyers brain.

Barnum and Bailey would have loved to have such an audience!

More amazing to me is why eBay does not police itself more.  Scams are not good for business (unless you are the scammer) especially if they result in a refund through PayPal.  I think though that eBay simply does not have the resources to do it.  At any given time there are over 15 million listings in eBay.  It would take a tremendous workforce to examine each listing.  It seems like some AI software would be of benefit though.