Mail order fraud is nothing new. There’s the apocryphal story from the 1950’s, and probably earlier, of the newspaper advert for Ever-lasting Slug Killer, “guaranteed to kill slugs indefinitely”. Respondents received two rocks, with instructions to place the slug on the first one and hit it with the second.
Consumer protection laws in the 1970’s and European distance selling regulations have rendered this kind of scam difficult. If the product you deliver isn’t what it’s cracked up to be, or even if it is, the purchaser has the right to reject it when they see it. Therefore there’s no point in delivering tat; you might as well not send anything. Ebay has been plagued by such scams, and there are now plenty on Amazon too.
To combat this, Ebay has policies that mean if the buyer complains, the seller doesn’t get the money. This has lead to the reverse-scam, where bogus buyers order something and then claim it didn’t arrive, and this has put a lot of sellers off using Ebay.
Amazon has a similar dispute resolution procedure, but in my experience, has a team of people with functional brains who can tell the difference between a wrong’un and a victim. Eventually.
You can see two common forms of scam on Amazon: Crazy price and Non-delivery.
Taking the second first; given that you don’t deliver the goods, how do you get the money? Without actually testing the theory I can’t prove this works, but I imagine it goes something like this:
- Set up as a seller, and pretend to be somewhere like China – long distance shipping.
- Find big-selling products and list them yourself, but at a slightly lower price than the other sellers.
- Wait for the orders to roll in, and then delay. Firstly, don’t ship immediately and then when you do, set as long a delivery window as allowed.
- Run off with the money.
This works because of step 3. Amazon doesn’t allow you to report a seller when you spot something merely suspicious, so they can keep selling stuff for several weeks before Amazon has the chance to investigate. The complaints procedure only allows you to report non-delivery AFTER the last date specified by the bogus seller when they ship it.
The thing is that bogus sellers like this are possible to spot before this. The extended delivery time is a first warning, and you can then research the range of products sold and how plausible it is that they’re cheaper than anyone else for the same product. Picking the cheapest supplier is a perfectly reasonable thing to do, especially when there are several scammers offering similar prices for fast moving items. Who would check further?
The other scam involves putting small items on at a crazy price, often a hundred times their real value. It’s quite conceivable that someone in a hurry wouldn’t notice they’d bought a small item at completely the wrong price. I’ve been noticing these sellers for several years, and out of public spirit, I’ve reported them to Amazon staff and they’ve disappeared shortly afterwards, with a note thanking me for bringing them to their attention.
Having never fallen foul of a crazy-price scammer, I don’t actually know how the problem gets resolved if you do buy something. Under contract law, if you’ve agreed a price and they’ve delivered your picture hook for £120+£50 delivery, you don’t have a claim. I see nothing Amazon can actually do about this, other than refund the buyer out of its own pocket and strike the seller off. Amazon’s lawyers may have something more creative.
However, even if the scammer only has one sale before being shut down, if that nets them £200 it’s going to be worth it.
As for the non-delivery scam, I don’t know how possible it is for the criminals to get away with the money. Amazon can’t hold on to it indefinitely, and will have to hand it to the seller at some point. Even if Amazon holds it until the latest delivery date, people aren’t going to flag it as fraudulent immediately – especially as the latest delivery date could be months later.
It ought to be fairly easy to spot these bogus sellers automatically by heuristics, and it’s high time Amazon put some effort in it. Perhaps they’re making so much money they’d rather write it all off.