Electronic Frontier Justice

Angela Gunn Consumer Reports WebWatch Web Ethics Columnist>

What happens when the ethics of a good Web site may not be good enough, and when that causes normally ethical users to feel pushed into a situation where they're sorely tempted to respond not so ethically? Our subject today — you've heard of the site — is eBay and the ethical dilemma that's posed when customer service appears to fall short of expectations in resolving fraud complaints. (Disclosure.)

There's something about the success of eBay that seems truly Net-friendly. Unlike so many high-profile online projects, the wildly successful auction site started small when it was launched in September 1995, grew at an appropriate pace, and managed to keep its feet when the bottom fell out of the dot-com house of cards. The service boasted 422 million transactions in 2001 and 288 million in the first half of 2002, according to eBay. It's estimated that eBay handles about 85 percent of all online auctions — everything from old shoes to new cars — and even in this ethicist's limited circle of acquaintances, there are several people who still fear online shopping and yet cheerfully plunk down money for tchotchkes they found on eBay.

If the Web was once a wild-west-style electronic frontier, eBay turned out to be the general-store shopkeeper that helped civilize the dusty trail. This is why it's vaguely retro and disturbing to hear talk, as one does lately, of vigilante shoppers seeking revenge for eBay deals gone bad.

The auction site is a fairly self-contained entity, in which members tend to take such self-regulatory mechanisms as feedback ratings (in which the seller rates the buyer and vice-versa after each transaction) relatively seriously. Sometimes, however, buyers who feel eBay hasn't addressed their problems sufficiently after a deal falls apart take further action. They report their complaints to the cops, to other buyers, and sometimes to the wider world of the Net, posting this-seller-stinks.com sites and so forth. Several would-be buyers have even purchased ad space on eBay itself to spread the word about sellers that didn't deliver the promised goods.

Taking grievances out into the wider world seems like, well, vigilantism — commando actions outside the bounds of the community eBay's built. Still, is it ethically worse than being a dishonest seller? Worse than the service itself not resolving complaints, as some folks have claimed? Who exactly is acting unethically here?

The vigilante movement has sprung from buyer frustration with what the FBI's Internet Fraud Complaint Center says is a steep rise in the incidence of online-fraud claims — nearly 2,400 per month this year, up from 1,779 a month at this time in 2001. Of those 2,400 fraud claims, 42.8 percent involved online auctions. (EBay says its fraud rate is .001 percent of all transactions on the site. Though the site won't confirm hard numbers, that percentage would suggest that eBay had approximately 42,200 fraud complaints last year.)

Taking someone's money and not delivering the item paid for is a no-brainer: That's fraud, and "sellers" who operate thus are unethical. That leaves us with two players left on the ethics stage — the buyer and eBay — each of whom sees a different problem: The buyer wants her money back, while eBay wants to eliminate bad sellers from their ranks. To that end, eBay ultimately responds to reports of fraud, if they're found to be accurate, simply by kicking the seller off the service — putting the fraudulent seller to the minimal trouble of re-registering under a new name. (EBay does have, according to spokespersons, a screening process with "checkpoints" that should flag any such returnees, but no further details are available on that process.) Any satisfaction beyond that, they say, is up to local law enforcement — and now, it seems, to protracted "vigilante" efforts on the part of buyers, many of whom are saying eBay's not going far enough to make things right.

What is eBay's ethical obligation to distressed buyers? The site offers a limited amount of fraud-protection programs, including links to a third-party dispute-resolution service and an in-house protection-claim program that can reimburse purchases up to $200. Beyond that, they offer links to law enforcement and postal-service officials, who have resources to pursue resolution in such matters. EBay also has an escrow service, in which the buyer pays money to the system to be released only after the item has been received and ascertained to be the real deal. In other words, the service senses an obligation not only to make things right when a sale goes wrong, but to offer a mechanism by which sales can be kept on track. That's cold comfort once a sale's off the rails, sure, but it can't be said that eBay didn't put a system in place, one that can — if used — provide substantial protection against abuse.

However, eBay's not off the hook ethically speaking. Escrow and dispute resolution are all very nice, but one buyer question keeps recurring: Where are the humans? At the moment, eBay's "SafeHarbor" complaint-response team requests that buyers wait 30 days before filing a fraud complaint — time enough for the post office to get a late package to an impatient buyer, but also plenty of time for the investigative trail to cool if fraud has occurred. More disturbingly, eBay has been known to keep information about a questionable seller to itself until matters are settled. Unless the site is ramping up its internal-fraud staffing at least as fast as fraud reports are increasing, that's a big window of time in which a seller suspected to be a bad egg can nonetheless ply his trade on eBay.

Preventative mechanisms and third-party services like escrow aren't enough; for eBay and other online auction sites to shine ethically, they need to commit significant in-house human resources to the problem, giving equal ethical consideration to the needs of sellers and buyers.

Given eBay's limitations, "vigilante" seems to be an unfair label to slap on what in most cases is just a buyer trying to get her money back. Buyers are right to pursue satisfaction through proper law-enforcement and consumer-affairs channels. In cases where buyers have and are willing to share conclusive proof of fraud, I'm willing to allow the rather creative tactic of buying an ad on eBay warning other buyers, since in that case the buyer is at least ostensibly acting with the good of the eBay community in mind.

One rather suspects that eBay, hands tied by their own slow-moving system and struggling to balance their ethical obligations to buyers and sellers, must have seen that ad and thought the same thing.

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Disclosure: I occasionally buy and sell on eBay and its competitor-turned-younger-sibling, Half.com, and beyond having to relist an item once when a deal fell through I've had no trouble whatsoever. Buyers and sellers have represented their wares honestly and paid on time. According to eBay, this is by far the normal course of events, just as most yard sales proceed without major incident.

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Gunn is the co-founder of, and former Internet ethics columnist for, Yahoo! Internet Life and is currently the technology editor for Time Out New York weekly magazine. She has written hundreds of articles for PC Magazine, MSNBC.com, The Industry Standard, Business 2.0, CNN.com, Seattle Weekly, LA Weekly, and other publications.