It seems like everybody is confused here, so to recap how us more seasoned sellers see it:
1. Buyer bought $750 watch. OP sent the watch Priority Mail but without signature confirmation. Packaged was scanned as delivered.
2. Buyer tried to open non receipt claim but since it wasn't past the estimated delivery date he didn't have that option. So he opened a return request instead, claiming NAD, damaged, but put in the notes section that he hadn't received it and this was the only option available.
3. Buyer has extensive criminal record (and apparently not very smart) and OP is justifiably concerned.
4. OP has until today to accept the return, which he did which was a good thing because eBay would have forced it with a defect.
Now here's my take. I would put the buyer on notice that you have contacted the postal authorities about the damage and that they will be sending an inspector to his house and look at the packaging. He doesn't need to know you didn't insure it. The best outcome here would be if he gets cold feet and doesn't return anything.
If he does return it, come back and we'll walk you through what to do next. If you don't see any movement in the tracking number from the return label by the date they gave you in the case, call eBay and have them close it.
Hopefully by the time any of this transpires, your connections will have LE knocking on his door.
