How eBay Exposes Sellers to Fraud and How We Protect Ourselves

[larry_linthic_ltd_co]

Whenever a buyer opens a return request on eBay based on a claim that the item was not as described in some way, a notification appears on the seller's dashboard with a reminder to "Respond to Return Request". Now, if a seller believes there isn't a valid reason to grant the return or refund, the seller has the option of sending the buyer a message through the return request form explaining why. It is worthy of note that, even after a seller responds to such a return request in that way, eBay's on-screen reminder to the seller continues to say "Respond to Return Request". There is a hidden implication in that.

It implies that, unless and until a seller grants a return or refund, even if the seller has indeed responded to the request, eBay doesn't recognize that the seller has "responded" sufficiently. In other words, eBay is not satisfied until the seller concedes to the customer's demand for a return or refund. Technically, eBay says the seller has 3 business days to reach an agreement with the customer. Logically, though, if the customer is initially asking for a return or refund, there is generally no reason to expect that the buyer would be satiated by anything less than that. Even if the buyer is willing to accept something less from the seller to consider the issue resolved, it still involves the seller giving up something of value, and that would be entirely unfair to the seller if the buyer's reason for requesting the return or refund had been entirely unreasonable in the first place.

If, after 3 business days, the seller has not accepted the return or issued a refund, and the buyer has not closed the return request voluntarily, eBay can intercede at the bequest of either the buyer or the seller. At that point, given a disagreement between the two parties about whether the return request is justified, it becomes a matter of which party asks eBay to "Step in and help" before the other one does. Although, ideally, this should not make any difference, as eBay should ethically give both parties a chance to fully express their viewpoints before making its decision (adjudication), the practical reality is that the party who didn't ask eBay to step in runs the risk of being quickly decided against by eBay without being asked for any further information -- especially if that happens to be the seller! If you need qualification of that statement, you only need to ask any number of eBay sellers in the world about their experiences in this regard.

In eBay's help article entitled, "How to handle a return request as a seller", it states (in part):

"If asked to step in to help, we may ask the buyer to return the item to you if any of the following apply:

We can't determine that the item received by the buyer matches the listing description"

To be clear and direct (where eBay is not), the part that says "ask the buyer to return the item to you" actually means "force the seller to accept the return of the item".

At first glance, eBay's quoted criterion for deciding whether they will force the seller to accept the return may have the appearance of common sense and fairness. After all, an item should be determined not to have been what was described in the listing before a seller is forced to accept its return, shouldn't it? The burden of proof of a claim of wrongdoing/error/defect/deficiency should be for the claimant to bear, shouldn't it?

Well -- in a just world -- yes, it should. However, if you read eBay's condition again very carefully, that is not what eBay is actually saying. What they are saying is that (if) they cannot determine that it does match the description...

Now, if you're still not catching on to the trickiness of the wording being used there, it's okay. It was undoubtedly intended to be very subtly deceptive. Let's put it into the context of an actual return request scenario, and see how it works out, shall we?

1) A buyer submits a return request claiming that the item was already damaged at the time it was received. Perhaps the item was damaged before it arrived. On the other hand, maybe the buyer just dropped it on the floor on accident, or maybe even broke it on purpose due to buyer remorse and no desire to pay for return shipping. Either way, the seller doesn't know. The buyer attached photos of the damaged item that would look the same either way, though.

2) The seller knows for sure that it was in perfect condition when sent, and the buyer didn't even suggest that the package was damaged in transit, so the seller doesn't believe the claim is true and doesn't agree to accept and pay return shipping for the return or refund.

3) Three business days later, the buyer asks eBay to step in and help. At that moment, by its own rules, eBay only needs to ask itself one question:

"Can I (eBay) determine that the item this buyer received DOES MATCH the listing description?"

So, if you were eBay at that moment, how would you answer yourself? You could only answer, "No, I can't". For one thing, the buyer had just said (for what that's worth) and showed photos (for what they're worth) of an item that had been damaged. For another thing, you weren't at the buyer's house when it arrived there, so it's impossible for you to determine the condition of the item received. This would be true even if the buyer had provided no photos at all. Isn't that convenient for you (eBay)? You (eBay) literally never need to do anything to always be able to say "No, I can't determine that the item matched its description". Based on your own policy (which sellers have no choice but to accept), all you (eBay) ever need to do is side with the buyer in every case and force the seller to accept the return. They set it up like this -- obviously -- on purpose.

It is clear, then, that eBay takes customers' SNAD claims merely at face value, without requiring any evidence from the buyer, thereby leaving the burden of disproving the buyer's claim on the seller from whom evidence is required.

In this scenario, the only chance a seller would ever have to win an item-not-as-described claim dispute would be to prove to eBay, beyond a doubt, that the claim were false, using evidence actually gleaned from the customer's claim in order to discredit the customer's claim. As examples, this could be done by showing previous correspondence from the customer after they received the item wherein they did not indicate that the product was damaged, or by showing that the photo was not actually of the item that the seller sent but rather a photo of a broken item of the same type that was downloaded from the internet somewhere it had been posted prior to the delivery of the item to the customer. Needless to say, a seller's chances of ever winning are very rare indeed.

So, as you can see, through its policy, eBay sets sellers up to lose virtually all SNAD claims, and eBay makes absolutely no effort to distinguish bona fide claims from fraudulent ones. This suits eBay just fine, since it considers the experience (satisfaction) of buyers to be of paramount importance.

Nonetheless, as a seller, before resigning yourself to the notion that you will always incur losses in these situations and letting buyers think that this is true, you need to remember one important fact: Despite however much it may seem that eBay has the final word on anything and everything that happens on eBay, eBay is not the ultimate authority on matters of business. The law is. However much eBay seems to act as though it is above the law, it is not. eBay is subject to the same laws as any other company. When they violate laws, they are subject to the same penalties.

Keep in mind that even eBay recognizes a sales transaction for what it is in the legal sense: a binding contract. This is why eBay does not require sellers to cancel customers' orders just because customers ask to cancel them. To do so would probably constitute unlawful interference with contractual relations.

An understanding of this law may be key to protecting yourself from fraudulent SNAD claims. This law exists in various forms throughout the United States under the heading of laws called torts. It may be referred to by various names such as "unlawful interference", "tortious interference", "wrongful interference", or "intentional interference" with contractual relations. At its core, this type of law is intended to protect those who have a legally-binding contract with another party from damages resulting from the unlawful interference of a third party that prevents one or both parties from performing their obligations. There are generally four criteria that must be met in such a case:

1) A contract exists
2) The third party was aware of the contract at the time of interfering with it
3) The third party's interference was intentional and/or wrongful (Some States consider that the interference in and of itself, given that the other three criteria are also met, is sufficient to meet the "wrongful" element, which does make sense.)

4) The third party's interference caused damage to the plaintiff

Keep in mind that, in the context of an eBay transaction, your binding sales contract with the buyer is whatever you state your terms and conditions of sale are in your listing. As long as your contract provisions are lawful and do not conflict with eBay's policies, eBay has no justification for ignoring or contravening them. Just as eBay officially recognizes that a transaction is a legally binding contract, it also recognizes -- as reflected at various points in its Abusive Buyer Policy -- that buyers must comply with the terms of a seller's listing.

If we re-visit, for a moment, the scenario of a possibly fraudulent SNAD claim, we can examine the root of the problem for the seller (i.e. within the scope of the larger problem of eBay's imbalanced policy). The root of the problem for the seller is the lack of evidence to dispute a claim of a buyer from whom eBay doesn't require any supporting evidence. This is what needs to be resolved. What evidence could there be that unquestionably shows the condition of the item upon receipt? Answer: video recording. At least, at this time in history, that is the best solution.

We don't give legal advice, but we'll tell you what we do:

State in the terms and conditions of our listings that any claims of damage, defects, or missing items must be accompanied by supporting evidence in the form of video recording showing the opening of the parcel and examination of the contents. Buyers can use their smartphones to do package-opening videos. For them to avoid the chance of almost any SNAD dispute, it's not asking much of them. Buyers can upload the videos to any of many freely available video hosting websites where we can view them when necessary.

If a buyer opens a SNAD return request, we remind them (and notify eBay, along with a link referencing the law in question) within the return request record that we have a sales contract that requires their video evidence for a claim to be considered valid. In addition to the original sales terms in the listing, this becomes part of eBay's records that we save as a PDF and print out with a timestamp as future proof that eBay was made aware of the contract before they took any action to interfere. If the customer still does not provide the video evidence and still pursues the claim, it constitutes a breach of the sales contract by the buyer. If eBay then steps in 3 days later and awards the buyer a refund or forces a return, then this is a breach of contract further resulting in damages to us by the customer as well as an act of eBay that meets the definition of tortious interference and for which we could seek compensation for damages from eBay if necessary.

That is to say, by eBay's relieving the buyer of their obligation to provide the required evidence by going ahead and issuing a refund from our account, eBay will have effectively prevented the buyer from fulfilling their obligation under the contract. eBay will have done so even after they had been made aware that the contract existed and knowing that doing so would cause us financial harm, which, we would then be able to argue was both clearly intentional and inherently wrongful.

If you believe that this may not work to persuade eBay to do anything different than they usually do, you may very well be right. There are plenty of careless customer service representatives who are content to do nothing more than mindlessly cite scripted responses all day long. We have mentioned eBay's risk of committing an unlawful act under this law to one of their agents before, who actually responded that he or she was not legally trained and therefore not authorized to discuss legal issues and then, even despite our warning, went ahead and committed the unlawful act.

What that eBay agent, and surely many others, do not grasp the concept of is that their actions and communications are legally regarded as being those of the company, and for which the company will ultimately be held accountable. If one agent is not legally trained, it is unreasonable for him or her to claim ignorance of the law as an excuse to take actions on behalf of the company that are potentially unlawful. They do not understand and probably don't even care to understand. They feel shielded by their corporate umbrella.

Even as that may be the case, as already stated, eBay is not the final authority on the matter in question. We do not depend on eBay to make the right and lawful decision. In fact, we believe it would be unwise to expect any company the likes of eBay or PayPal to do so. We prefer to leave that to a judge in small claims court, perhaps not today, but maybe within 2 years time, once we have racked up records of a dozen or more offenses by eBay and contract-breaching customers to make it worth our time to deal with them all at once.

[larry_linthic_ltd_co]

We believe that we do have the right to establish any lawful terms of sale we wish, provided that they do not conflict with eBay's policies, and we do not see how our terms and conditions actually conflict with eBay's policies.

If you know where in eBay policy documentation it's stated that we don't have the rights you mentioned, we would appreciate if you would point us to those links. Thank you in advance.

[lac358232]

Sorry, but you're wrong. eBay policy states:

In some instances, we may not require that an item be returned to the seller. In these situations, we refund the buyer and may seek reimbursement from the seller, for example if:
- The [buyer claims] the item was not as described

To be "clear and direct" this means that when eBay is asked to step in, eBay merely checks if this is a SNAD return request regardless of any evidence or circumstances, and if so retains the power to refund without requiring a return.

And marking your own post as the solution is picking up your marbles and exiting.

[nuvistors]

 Our sales contract comes into play before any eBay Money Back Guarantee case exists.

++++++++++++++++++++

WRONG !

You contract with ebay  trumps any weasel words you may put in your listings

[larry_linthic_ltd_co]

Actually, we meant to mark that specific reply to us, not our own response to it, as the solution, but then the page for some reason took us into a step to respond to that reply, and we're not sure how it ended up showing the checkmark on our own writing, but we couldn't change it afterward.

On to addressing your point:

Yes, the eBay Money Back Guarantee obviously has its given set of terms. What people fail to realize, though, is that just because eBay doesn't mention anything about requiring evidence to support any SNAD claim does not mean that anyone's requiring evidence is against eBay's rules. 

Regardless that eBay's terms do not say eBay requires evidence of a claim, eBay's terms also do not say, "A seller is not (itself) allowed to require evidence of the claim from the buyer".

Simply put, eBay's terms are completely silent on the matter of evidence for claims. That makes it more or less effortless for eBay to deal with most SNAD cases, but it also leaves open an opportunity for sellers to say something in the space where eBay says nothing.

eBay's terms and conditions only pertain to the matters they mention. They are not an exhaustive list of anything and everything a seller or buyer can and can't do. eBay's terms don't say a seller can't giftwrap items unexpectedly for customers. Does that mean eBay's terms disallow a seller giftwrapping items without notice? No, of course it doesn't. eBay's terms don't mention the matter at all. It's an area of free will.

The place where the seller has something to say about evidence is not between the seller and eBay. It is, rather, between the seller and the buyer, within each new contract of sale. 

The buyer, by purchasing, has agreed to whatever terms of sale the seller has stipulated in the listing and is required to abide by them as long as they are lawful and not in conflict with eBay's pre-existing terms.

A seller therefore does have the right to stipulate that, as far as the deal between itself and the buyer is concerned, that a buyer needs to substantiate such a claim.

Though eBay may not make any such stipulation at all, itself, it still does legally have a duty to avoid doing anything unlawful. If eBay is aware that the terms of the sales contract between buyer and seller have provisions requiring evidence of SNAD claims, and it intentionally ignores that and goes ahead and interferes with the contract, knowingly thereby causing financial harm to the seller, that is the definition of tortious interference with contractual relations (an unlawful act).

[larry_linthic_ltd_co]

The customer enters the sales contract (i.e. purchases an item) before ever opening any SNAD claim. That's an indisputable fact.

One thing trumping another can only occur if another thing somehow contradicts the one thing, and that's not what we are advocating.

Any person's asking for proof to be shown before they are charged with and penalized for some sort of wrongdoing is humanly natural, in line with the notions of fairness that are the intended foundation for all modern democratic laws.

If anyone would call that sneaky, I would have to wonder which branch of communism they follow.

[larry_linthic_ltd_co]

P.S. Pointing out the fact that eBay may force a refund without requiring the return of the item, instead of just forcing the seller to accept the return, as a basis for saying that we are wrong (which people would interpret in an "overall wrong" sense) is the sort of nitpicking that misses the overall point.

Given what we are saying is that what eBay is doing is unfair and, therefore, bad, this observation does more to underscore our point than refute it.

[johnson_junk_company]

Sellers fighting fraudulent returns are hardly foolish!! If eBay wants to offer a money back guarantee….they should fund it! Simple as that. A vast majority of of sellers would not offer such a guarantee, especially on used items. Sellers just want more autonomy to run their businesses the way they see fit. We pay eBay for hosting services….that’s all. 

[johnson_junk_company]

I totally agree with you. Sellers trying to defend eBay’s poor business policies are fools. eBay needs sued by sellers so that sellers can be allowed to make their own decisions on how to run their businesses. eBay didn’t initiate the “money back guarantee” to be helpful. It was strictly a marketing ploy in the early days. It’s not appropriate to force sellers to abide by a  policy that clearly puts them at a disadvantage. If eBay wants to offer the MBG, then they need to fund it! If they had to pick up the tab for these fraudulent returns and disputes they would quickly be putting into place some requirements that buyers needed to follow. After all we’re paying eBay to host our stores on a digital platform, not run our customer service departments! 

[donsdetour]

Wow that is one long winded post;;;

To sum it up fast and easy:

Ebay has not idea what was sent: and not idea what condition it was received.

The have no idea who is telling the truth or not.

Truth is they do not care:

The do not even care what was sent back to you as they would have no idea what such was.

You as a seller agree to the money back guarantee by selling on eBay.

eBay bots is most likly going to force you to do a refund for an item not as described case...

Really eBay has no other choice;

You get two options return for refund:

or let em keep item and refund...

You might be able to get the user to drop such a case if you request info that the can show it is not as described: yet if a knowlegable user; such will not work.

Such cases might end up in a small claims court: but usually cost more to do so than worth.

If a returned item is switched out that becomes a case for law enforcement and should be reported;

If a return is such that it shows the user is abusing the return policy one should report such to eBay.

Do not expect any thing of it: but to many the user will lose such privileges of returns and the MBG.

Oh and I did not read that whole thing...

[ligu_7529]

Amen! Preach!

Tell it like it is :-)!

[kh-gary]

Hi everyone,

Due to the age of this thread, it has been closed to further replies. Please feel free to start a new thread HERE if you wish to continue to discuss this topic.

Thank you for understanding.