Congress To Make eBay A Rat

Sites required to conduct secret investigations

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Taken together, three bills in Congress would require online marketplaces and auction sites to secretly police affiliates suspected of selling stolen goods. In addition to requiring extensive record keeping on sellers using the site and turning over that information to authorities upon request, the legislation prohibits resale sites—like eBay or craigslist—from informing suspected sellers they are being investigated.

>> Article Updated 09/29/08

None of the bills, two in the House of Representatives and one in the Senate, is expected to come to a vote before the Congressional recess—they’ve got bigger fish to fry in Bailout Brand oil at the moment—but the House Judiciary Committee’s Subcommittee on Crime, Terrorism, and Homeland Security held a hearing on the subject recently.

The purpose of the legislation is to target organized retail crime, or bands of shoplifters and hustlers hocking ill-gotten goods online, where the National Retail Federation, which has come out aggressively in favor of the legislation, says thieves can sell goods at 70 percent value. Street corners typically only bring 30 percent of the retail value.

The problem was highlighted recently when a New York vendor was busted selling Victoria Secret brassieres on eBay for $25 a pop. They typically sold for between $40 and $80.  If you’re wondering why Homeland Security is being dragged in to this, it’s likely because of alleged past connections between organized retail crime syndicates traced to Hezbollah and Hamas.

Naturally, the Internet is to blame.

Though, NetChoice’s Steve DelBianco colorfully compared this logic to blaming the back seats of cars for teenage sex, the NRF’s vice president for loss prevention, Joseph LaRocca, has elevated the problem to the level of addiction to Class A narcotics. At the aforementioned hearing, LaRocca said:

"The Internet seems to be contributing to the creation of a brand new type of retail thief – people who have never stolen before but are lured in by the convenience and anonymity of the Internet. Thieves often tell the same disturbing story: they begin legitimately selling product on eBay and then become hooked by its addictive qualities, the anonymity it provides and the ease with which they gain exposure to millions of customers. When they run out of legitimate merchandise, they begin to steal intermittently, many times for the first time in their life, so they can continue selling online. The thefts then begin to spiral out of control and before they know it they quit their jobs, are recruiting accomplices and are crossing states lines to steal, all so they can support and perpetuate their online selling habit."

Soon you’re likely to see them on A&E’s “Intervention.” Though evidence of the above scenario is lacking, it sounds like Congress is taking this just as seriously as the NRF.

Individually, the bills are: H.R. 6713, the E-Fencing Enforcement Act of 2008, sponsored by subcommittee Chairman Bobby Scott, D-Va.; H.R. 6491, the Organized Retail Crime Act of 2008, sponsored by Representative Brad Ellsworth, D-Ind.; and S. 3434, the Combating Organized Retail Crime Act of 2008, sponsored by Senate Majority Whip Richard Durbin, D-Ill.

Congressman Scott’s E-Fencing Enforcement Act mandates that online stores and resellers disclose contact information for high-volume sellers—with sales of $12,000 or more per year or sales of $5,000 or more in any single offering—“to any inquirer with standing under this section.” An “inquirer with standing” is defined as anybody who sends a copy of a signed report made to or received from law enforcement in the past year involving goods matching the description of those offered online after a theft.

The legislation requires marketplaces to store contact information for three years, and upon the retailer’s request the online marketplace would be required to investigate whether the goods sold are stolen. If so—or even if there is good reason to think so—the online marketplace provider would be required to ban the seller and remove the seller’s listings.

Congressman Ellsworth’s bill ratchets it up another notch, making both online and offline organized retail crime a federal offense. Ellsworth requires providers to act quickly to investigate and to maintain a database of all suspected shady sellers, including their name, telephone number, email, physical address, user ID, company name, and a record of all transactions for three years. Again, the provider is required to hand over that information to anybody with suspicion of a particular seller.

Senator Durbin’s bill puts the nail in the due process coffin by requiring online marketplaces presented with evidence (by any inquirer with standing, remember) that a seller is fencing stolen goods to file a report with the US Attorney General, tell the plaintiff the report has been filed, and then start looking for evidence of other illegal activity. Durbin’s legislation bars the provider from informing the seller they are being investigated.

Quick summary, if these bills pass: Anybody (retailer, competitor, etc.) who claims to suspect a seller of illegal activity can file a police report, present it to the marketplace provider and the provider must shutdown the seller. The records the provider has been required to keep for three years of all seller information and activity must be handed over to authorities and reported to the Atty. General while the provider presumes guilt and conducts a secret investigation of the seller on the government’s behalf in case there might be, could be other illegal stuff happening, and is barred from saying anything about it to the seller.

Please, someone explain to me how that’s remotely constitutional.

It’s all not without its hypocrisy, of course. Democrats have railed for some time (before caving in other instances, like with FISA legislation) about the Administration’s continuous erosions of rights and liberties, and here we have three Dems constructing further erosions. The NRF, too, looks a bit ridiculous in this, not just for their comparison to addiction, but also since retailers have refused to accept eBay’s offer to help police for stolen goods because they didn’t want to give up any control of the process. Clearly, government control is better then, huh?


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  • Guest

    Well it must be pretty bad if they are wanting to do that.  I  think if the gov wants that done they need to do it and absorb all the costs.  How about

    paying people to rat out others?  This day and time most people are hurting for money.  Let them get paid for ratting out others.   They could help other’s by doing it and possibly save themselves money by not having to set up another entity to do it.

  • Guest

    There are lots of crooks on Ebay. I’ve been scammed several times and no longer shop there. I don’t see a way to control it but I think Ebay itself might be able to do a better job of monitoring sellers if they chose to do so. Government intervention could only make it worse. We’re being spied on enough!

  • Guest

    I’m so sick of "Big Brother" that I cringe at such vagaries being made law – abuse of power and authority by the powers-that-be is out of control, and the word terrorism is being used to incite further intrusion and abuse upon average citizens. Just recently, potential protestors were arrested before they had the chance to leave their homes because of this very same fear-based reasoning. THAT is terrorism. Enron is terrorism. Oil companies with their record profits are terrorists. Pediphiles are terrorists in sheeps clothing. Allowing Bin Laden to roam free after 911, while attacking another country for its oil fields and sending our families to kill or be killed is terrrorism. Forcing the elderly and disabled into nursing homes rather than allowing them to live in their own homes & communities with a reasonable level of care, that is terrorism. Having the Consititution & Ammendments warped for commercial interests is terrrorism.

    Having said that, I’ve been burned by eBayers in the past, and the level of accountability provided by eBay policies amounted to zero satisfaction. Is there no middle ground? Why shouldn’t justification and/or a warrant be produced to authenticate reasonable suspicion to investigate specific entities, instead of carte blanche to collect whatever information the government wants on anyone? And who is going to pay for all this new policing? Ebay (of course this would be passed on as an additional fee for users) or another government slush fund? And who will police the police?

    I’m all for catching the bad guys here, but I resist the thought of loosing even more freedom.

  • Christopher

    The true thieves are folks like DelBianco and every member of government, who continues to "not have a real job".  They only wish to perpitrate their non-productive, cost-consumptive and taxpayer-burdened jobs.  They should all be fired: we should remind them that this WAS to be a government "… of the people, by the people and for the people".

    What we get are bozo-simps like McPain and Palin.

    We deserve everything we get.

    • Fay

      Christopher, did you notice that these bills were proposed by Democrats?  At least McCain and Palin want to REDUCE the amount of government regulation.  They are on the conservative side of things. 

      History shows clearly that fascists, nazis, communists, and socialists are liberals.  Obama is a liberal and wants more and bigger government. 

      I value my freedoms and Constitutional rights and I do not want my leaders to be my Big Brother or my Nanny.  The liberals who are treating the Constitution as a list of suggestions frighten me.

      • Guest

        Fascism is extreme right-wing idiology. You don’t know what you’re talking about, obviously. McCain has not indicated any change from the Bush Administration, which has created Big Brother with the Patriot Act and endless big government spending on freedom-eroding secret police tactics. And Palin’s a functional moron. "Look, there’s Russia. That makes me qualified to be President." McCain’s lost his mind. He and that dumbass beauty queen will just break the bank continuing Bushism and taking us to war with Iran and Russia, and whoever else gets in our way. Loving the troops should consist of actually avoiding conflict as much as possible so we don’t endanger them unnecessarily. We’ve lost all credibility in the world. Obama will help restore it and, just like his Democrat predecessor will get us a surplus again and help make it so people can afford to live again instead of being crippled by inflation in every sector that matters: gas, healthcare, groceries. I just spent over $3 for a half-gallon of milk. You can thank Bush and his buddies for that.

      • crowmd

          Liberals,in the 60’s it was commie pinko’s,drug using hippies,etc,etc. What always gets lost in the translation is why is being liberal a bad thing? Most of the rights we have in this country ,or what’s left of it anyway came from liberals.Jefferson was a liberal, Benjamin Franklin was liberal on some things and conservative on others. Like most people.

          Just as the term conservative has changed over the years so has the other ideologies. When the Russian economy collapsed there were millions of people who cursed democracy and said things were better under communism.Even under Sadamm there were lots of people who said things were better as long as you played by the rules.

         And there lies the rub,under any ideology if that person is making money,then they want to keep things the same.It like that all around the world.Liberals today stand in the way of big business and want to hold the govt. and corporations accountable for there actions to protect the citizens and the consumer alike.And this is a bad thing?



    • Guest

      As to bozo’s you best add Obama and all the do nothing Senators like him!

  • Guest

    Apparently the only mistake Orwell made is that he got the date wrong. We’ve passed the tipping point. Harrass the small businesses and give away a trillion dollars to bankers who are either stupid or crooked. Either way stick a fork in freedom, it’s done.

  • Guest

    So I have 2 Auction Websites and live in the UK.??

    Would this affect me? and if so,  how?


  • Guest

    The government is after the wrong people, they have to go after people that steals identities anc commit frauds, then they would kill 2 birds with one stone. What I don’t get is the government should have treated ebays sellers as business entities and require them to get licences, this would drastically weed out people that wants to commit fraud.

  • Greco

    The internet is a great place to conduct business it is also a great place to comit fraud because to the anonimity, and such sites as ebay, paypal or any other site should protect both the sellers and the buyers. There is a major issue about this, ebay was not design to do this and so as the others sites, they are design to make money from the people that utilized their sites in conducting business whether it is legal or illegal. To solve this issue there should be a governing factor, but since everything is virtual, then it can not be done, once the server or busines is moved then there is the jurisdiction problem. The only way this will be solved is when a company like ebay or paypal stepped up and do the right thing which is to developed a more secured and intelligent sites.

  • Sunni

    I think it is a bit far fetched to think people will start selling goods on the net and then (upon running out) will cross state lines to steal stuff to sell.  That sounds pretty crazy to me and I really don’t believe that happens.  If it does I think it is a rare event.   The government is always trying to scare people into thinking all these awful things are going on so they need to get involved to protect us.  Really I don’t think they care one way or the other about the common folk.  And you sure can’t believe anything they say because they say what they think is necessary at the time.  It is true people can get addicted to the net but not in that way.  I think selling stolen goods is really very small in the scheme of things.

    The government seems to be into everything making it their business for one reason or another.  They always seem to be trying to save us from ourselves.   I think they have no business getting involved in half the stuff they get into.  But it’s the government so what can you do?  Granted there are plenty of evil people out there these days but I think alot of this stuff just hurts the ordinary person who is having a hard enough time.

  • Guest







  • Guest

    Since that greedy Frenchman took over both paypal and  Ebay that seems to be the case …….fees everywhere.

    Some sellers take a while to wake up I hear.But others think it is not worth the trouble.It’s like with everything it takes money to make money and Ebay is no exception.

    As for police doing their work why not if you are honest  why object.?I would think it was in your  best interests too. Why would you want Ebay warning thieves. Or do you think it should be open slather on the Internet?

  • Guest

    I think  its good because as long as everyone is not selling stolen goods on Ebay  everthing should be just fine

  • yvette hooper

    To Whom It May Concern:

    I think that the government just does not know what to do with itself.

    I just started getting into the eBay madness myself and now they are taking the fun out of things.

    Sure, i’m all for making sure laws are not broken, but they will start scaring a lot of honest patrons away with the big brother approach.

    Congress should stick with helping the president get this country out of the mess it’s in right now.

    I’m sure that big businesses like eBay can handle whatever that comes it’s way.

    They take the fun out of everything!



  • Guest

    life of  the criminals  fbi cia fed irs is like a giant turd the more they squeeze the more shit will drip on there shoose ha ha idiots

  • http://www.cannabis.eu.com FaTe

    So look for "Ebay-annomonous" groups soon? You know health care for those convicted for such offenses…..I understand the need but once again I’m glad to not live in the U.S.A

  • http://www.thetraderoutlet.com Ed

    The answer to the 1 question is in the text. the US government. So those of you in other countries don’t have much to worry about from the "world police" heh.

    "register" with a government agency: that would mean they have to work. that can’t happen.

    While I can’t speak for E-bay But our site only uses Paypal so all purchases are electronic. Simple track for big brother. And I know from my own size someone as big as bay can’t track every person on how many times they sold something. I have a couple guys who ARE wholesellers. They sell a bunch of the same items. Big brother gonna go investigate them? I don’t think they will pass. to many conflicts with the constitutional right. It’d be to easy to say "ya we checked it out and found nothing." Then big brother comes in and finds something or makes something up.

  • Mo Big Bro

    Great posts and comments. Here are a few more thoughts:


    1) There is no such thing as anonymity on the Internet unless your doing a great job hiding behind a proxy, but in reality, everything is trackable on the Internet.

    2) While it appears there has been some massive theft ring and people needing eBay anonymous to kick the need to sell stolen goods online. Where is the evidence that this is the case? Any news reports or studies, or do we just take this at face value?

    3) What Constitutional rights do we have left? And why aren’t American’s stomping mad?

    4) Why is that we never see any media reports regarding Constitutional rights being erroded?

    This is just another ill attempt to get at the publics private records and information while putting all the burden on companies like eBay to start policing. I think this will hurt


  • Hughze

    Looks like the old ‘ We’re the victim not the criminal’ routine with the foolish lawmakers letting them believe it with their ‘an ounce of prevention is worth a pound of cure’ legislation.  Got to remember there is already an investigation going on now over illegal surveilance.  I believe it’s against the US government or even very prominant elected officials of the US government.

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  • Guest

    It is the governments way to weasel their way to take total control…..first this, then that…….thereby eroding our very freedoms they are supposed to defend……….socialism, communism, governmentism……haha……..if it makes big bucks, they want in.  How else can they support all their agendas for massive government control. 

    It is best we wake up.  What about gambling……do they care what it does to the less fortunate and their families?  What about selling alchohol on our nations highways?  The dollar speaks more clearly than the people of this land.

    Taxes on everything provided by internet and gov’t getting its share.  Follow the money!

  • Guest

    Clearly a case of too many congressmen with too much time on their hands.  This proposal is something which is easilly doable.  eBay probably already is keeping logs of sales and purchase statistics for all members.  Personally, I really don’t care since I stopped using eBay when they started forcing PayPal use, and raised fees to unreasonable levels.  I previously paid by money order and had over 60 no-problem tranactions. Fo me, eBay sucks and I hope it continues it’s downward spiral.  This legeslation will undoubtly help.  So be it.

  • Guest

    I live in the Irish Republic. I rarely purchase from USA suppliers on ebay because many decline to export to Europe.

    I see no reason why Federal authorities should add cost to my purchases when my actions cannot involve the USA.

    I do not mind the USA knowing full details of my purchases, but would resent paying extra for my goods in order that ebay may tell tell the authorities.

    BIG BROTHER IS WATCHING! The film only got the year wrong.




  • Guest

    Don’t worry, be happy! Obama is going to make our mortgage and car payments, and give us free medical. I will continue to sacrifice my liberties because I will be safe! Why does he have to give up his Blackberry?

  • Guest

    Typical Democratic rights erosion crap! Now the Government is whining because they want retailers to act as ‘Unpaid Vigilante Deputies’ as they can’t do their job! It’s NOT the job of Retailers to act as Deputies!

    Stop this further erosion of rights! Sure, those perpetrating the problem should be caught, but that’s not the Retailers job is it! Start giving in to that dictatorship and watch what else follows.

    The Government has got so arrogant and controlling already, it needs to be stopped from further abuse!

  • http://www.qualityclotheslines.net Folding clothes lines

    I sell my folding clotheslines off ebay and when i did i was checked for my authenticity. i didnt mind as i knew they were trying to protect the public and thats a good thing for the reputation of sellers online as a whole.

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  • ZenMaster

    Let’s be realistic and understand some basic concepts:
    Gov’t tries to protect people from themselves soley as a means to control the same.
    To put it bluntly, by our own actions we get what we have earned. And the bottom line on E-Bay is that it is a world-wide barter & trade symposium that is hard to tax. And let’s face it, when it comes to taxation the Gov’t & the powers that be want a piece of the action and will use any means to get it. Including the age old excuse of protecting the people from themselves.

    If I was E-bay…. I’d say fine & close shop. Re-emerge again under the original business plan. One thing is clear…. economic realities trump political realities.

  • http://www.durashopping.com Guest

    I quit Ebay! Now Iam out for revenge! Lets stick it to them like the greedy sons of ####### did to us. I now have my own website where I sell Amazon products, that means I make money off other peoples auctions. Plus I can list all the products of my own that I want, (I do not have to list them with Amazon first) I just put them up on my website. I can also put all the affiliate links banners and digital products that I want on MY webpage and get paid for it. I have my own domain name so Iam building my own brand name and customer base. It was a turnkey website setup and ready to go when I started it, but with the online editor you get with it you dont need to know HTML or any programing to add your own products,banners, affiliate links, or digital products. I can change the site to look anyway I want its very easy to do. And I offer my costomers Free online games,news ,weather, sports and more. All for $20 a month. Why pay Ebays fees when you can have all of this and amazon will pay you to sell other peoples poducts along side yours , and you dont have to list anything on amazon if you dont want to? Go to my site Durashopping.com to see an example of this Website. I have modified the site(you will not get one just like it) to look the way I want, you can do the same very easy. If you also want to do this- just click the green banner at the top of the page.


  • Guest

    If you haven’t been keeping records on ebay you had better start or make arrangements with the IRS. It seems like the illegal aliens have taken over ebay and billions have vanished into the abyss.

    eBay will be turning over millions of records on small and large sellers and also, get this large spenders. There are also planted all over eBay spies so if you get a knock on your door have your paper work ready.

  • http://www.qualityclotheslines.net Sydney

    Ebay are like the banks, a law to themselves.

  • http://www.blackhatseoworld.com blackhatseo

    I was skimming the comments at the bottom of the page and they appeared to be half for and half against the idea – each making some pretty good points, but if someone steals an item, they will find a way to sell it.

  • Guest




  • http://car2be.com/ used bentley for sale

    To solve this issue there should be a governing factor, but since everything is virtual, then it can not be done, once the server or busines is moved then there is the jurisdiction problem. The only way this will be solved is when a company like ebay or paypal stepped up and do the right thing which is to developed a more secured and intelligent sites.

  • http://www.haydisendeoyna.com Silkroad Silk

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  • http://www.onsiteearlychildhoodtraining.com DVD Training for Childcare Staff

    Thanks for a great article and it has really opened my eyes up to Ebay!

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