A NY Auction Fraud Lawyer Explains line Auction Fraud
Internet auction fraud may seem like a minor crime, but it can have serious consequences. Even eBay fraud can potentially lead to federal or state criminal charges for offenses that carry lengthy prison sentences. Whenever you have been accused of eBay fraud or other types of Internet auction fraud, you should speak with a lawyer who can provide you with aggressive legal representation.
An experienced auction scam attorney at Bukh Law Firm, PLLC represents eBay power sellers and others accused of any type of dishonest behavior using eBay or other online auction marketplaces. We work hard to help you negotiate a plea agreement, secure a not guilty verdict, and avoid having your assets frozen or lost due to fines, fees and required restitution. If you have been accused of an auction scam, contact us right away for assistance responding strategically to the serious charges against you.
What is Online Auction Fraud?
Auction fraud is defined by the Internet Crime Complaint Center as “fraud attributable to the misrepresentation of a product advertised for sale through an Internet auction site or the non- delivery of products purchased through an Internet auction site.”
Fraud can encompass any false or misleading statements, material misrepresentations, or false promises of future actions. You can be charged with auction fraud even if you are not successfully able to carry out a fraud scam. If prosecutors can prove beyond a reasonable doubt that you made an attempt to commit fraud through misleading behavior or false statements, you could be looking at a criminal indictment.
More than 70,000 complaints of online auction fraud are made each year to the Internet Crime Complaint Center, and auction scams account for around one in every four complaints. While authorities often focus on seller fraud, buyers can be accused of committing fraud as well. Individuals and businesses may all be charged with fraud schemes related to alleged dishonesty surrounding auctions.
Because eBay is the largest online auction site, many types of auction fraud are facilitated through this website. However, auction fraud can also occur on other places on the Internet as well. For example, many penny auction scams exist in which consumers must pay fees for bid credits; while some are legitimate others may be accused of illegal sales tactics or fraud against consumers.
Types of Internet Auction Fraud
Internet auction fraud takes many different forms. Common examples of fraudulent or misleading behavior include:
- Overpayment fraud: A seller is the target of this auction fraud scam, which typically involves a high-dollar item being sold. The scam involves sending the seller a counterfeit check or money order for a larger amount than the item’s sale price. The seller is asked to deduct the sale price and return the difference to the buyer, which the seller may do before finding out the check or money order is fraudulent.
- Non-delivery or failure to ship merchandise – This is the simplest type of eBay fraud. A seller lists an item on eBay or other auction site and receives payment for the item, but then never sends it to the buyer.
- Wire transfer schemes– Wire transfer scams occur when buyers are asked to wire money but never receive items. A seller who is overpaid using a fraudulent check may also be asked to wire the “overpayment”
- Second chance schemes– Second chance schemes involve contacting losing bidders of legitimate auctions offering to sell products to them at their highest bid price. The money is collected but the items are never sent.
- Misrepresentation– Misrepresentation involves dishonesty about the quality, type, or condition of a product being sold in an online auction. A painting may be misrepresented as being by a famous artist when it is not, or a counterfeit product may be misrepresented as being real.
- Triangulation– Triangulation is a complicated auction scam in which a seller lists a high-value item on eBay for a lower price than it can be purchased for elsewhere. The item is then purchased from Amazon (at a higher cost) with a stolen credit card number and is sent to the eBay buyer. Amazon’s fraud division forces the eBay bidder to surrender the item to Amazon for nonpayment and is unable to contact the original seller.
- Fee stacking– Fee stacking involves tacking on fees after a sale has been made. Usually, fees for shipping are added on.
- Selling black market goods– Black market goods are items for sale illegally. Items may include copies of computer software or counterfeited designer clothing or jewelry. Items typically are misrepresented as being legitimate but come with no warranty or protections for buyers.
- Selling counterfeit goods- Counterfeit goods are items made bearing a trademark without the trademark owner’s permission. Fake handbags and jewelry are examples of some of the counterfeit goods routinely sold on eBay and other online auction websites.
- Multiple bidding– Multiple bidding involves a buyer placing multiple bids on an item, including a high-priced bid to scare off other potential buyers. At the last minute, the high priced bid is withdrawn and the buyer is able to purchase the item for a lower amount.
- Shill bidding– Shill bidding involves a seller using an alias or someone associated with the auction scam to bid on his item, driving up the price.
- International auction fraud– International auction fraud frequently involves individuals from countries outside of the United States flooding auction sites with in-demand products and collecting funds for the products using wire transfer. Items are never sent.
- Escrow services scams– Escrow services are supposed to protect buyers. Money is placed with a trusted third party until the merchandise is sent and approved. Escrow services scams, however, involve the creation of a false escrow site resembling a legitimate site. Money or goods are sent to the escrow site but the seller is never paid for the goods or the buyer never receives the item.
- Internet fencing– Internet fencing involves using eBay or other online auction sites to sell stolen property to unknowing consumers.
- Shell auctions – Shell auctions are auctions in which no merchandise actually exists and the auction is listed solely for the purpose of obtaining money or personal information from a buyer.
Both buyers and sellers can be accused of Internet auction fraud. In many cases, an accusation of fraud is made based on a simple mistake, like a seller not being aware the items he was providing are counterfeit goods. If you are accused of violating laws on auction fraud, remember a prosecutor must prove you were knowingly deceptive or intentionally turned a blind eye to fraud. An eBay attorney can help you to try to fight charges after an eBay fraud arrest.
Penalties for Online Auction Fraud
Penalties for online auction fraud vary significantly depending upon the nature of the offense. If you are accused of auction fraud, you could be charged with wire fraud (18 U.S. Code Section 1343), mail fraud (Section 1341), fraud in connection with identifying documents (Section 1028), or bank fraud (Section 1344), among other federal charges.
In New York, the Donnelly Act prohibits bid rigging and price fixing, including in online auctions. Possible penalties under NY General Business Law include up to four years imprisonment and a fine up to $100,000 for individuals or a fine up to $1 million for businesses. A violation of Antitrust laws under the Donnelly Act is just one example of a felony charge you could face on the state level.
An Auction Scam Lawyer Can Help
Bukh Law Firm, PLLC has extensive experience with auction fraud. If you need an auction scam lawyer or eBay lawyer to help you fight fraud charges and minimize the possible penalties and consequences you could face, give us a call today.
