iMad at eBay Auction Fraud
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Wednesday, April 23, 2002
By Jim Bodor
Telegram & Gazette Staff
Money disappeared into Web addresses
WORCESTER-- A Worcester woman is at the center of federal, state and local investigations into allegations that she collected more than $300,000 in computer sales over the Internet without delivering the purchased systems.
Teresa Smith, 25, of 65 Lake Ave., was arrested by West Boylston police last Tuesday on a charge of larceny, according to Officer Jay Dugan, who is investigating. Four of her businesses use an address at Suite 32, 45 Sterling St., West Boylston.
That arrest, made on a warrant after she tried to pass a check that bounced, led investigators to allegations that Ms. Smith defrauded more than 150 people, using a web of businesses she operated over the Internet, Officer Dugan said.
The U.S. Attorney, the state Attorney General, the U.S. Postal Inspection Service, the FBI and the Worcester District Attorney's office all have launched investigations into the case, according to Officer Dugan and other investigators.
Ms. Smith has been released on a promise to appear in court on the larceny charge while the larger investigation continues.
Complaints about Ms. Smith's businesses, which operated on various Web sites under such names as ShadowSB, DRJ Co. LLC, and Cheap Trick Sales, began pouring in to the Better Business Bureau of Central New England Inc. about two months ago, said Barbara J. Sinnott, president of the bureau.
Two Better Business Bureau consumer specialists, Diana A. Bernstein and J.C. Giroux, began tracking the complaints and trying to resolve them with Ms. Smith, Mrs. Sinnott said.
They uncovered, they said, an alarming pattern. People from Ohio, New Jersey, California, Michigan, New York and other states responded to Ms. Smith's sale offers. They ordered computers, sending her cashier's checks for systems priced mainly from $2,000 to $5,200. Weeks passed, but they did not receive their equipment, said the Better Business Bureau.
When they contacted Ms. Smith to complain, she made promises to deliver the equipment soon, or sent a refund check. Those checks, however, usually bounced, the Better Business Bureau consumer specialists found.
One person who is still waiting for computer equipment from Ms. Smith is Chris A. Sollars, a 26-year-old video editor and Web designer from San Francisco. He ordered an 867-megahertz computer with a 17-inch screen from one of her online companies in January for $2,275, he said.
When he did not receive the computer as promised by February, he called Ms. Smith to complain. She promised to send him an even more powerful computer to make up for the delay. Again, several weeks passed, he said. He complained again. This time she promised to send him a refund by cashier's check. He later received a refund by personal check, which bounced.
"She kept saying I'm sorry, and strung me out with white lies," he said. "She said, 'I'll send you a check, I'll send you a fax, I'll send you a tracking number.' "
Mr. Sollars said he has often ordered computer equipment online, and never before had a problem.
"This is the first time I've ever been duped," he said. "I don't know if she just got in over her head or what. I'm going to be very tentative from now on (ordering online) anything over 50 bucks."
Cecily Barnes and her fiance, Shahir El-Shaieb, of Santa Cruz, Calif., said they too were duped by Ms. Smith. They bid on a MacIntosh computer for sale for $1,700 on eBay by Ms. Smith. They saved for three months to purchase the computer, Ms. Barnes said.
"We're pretty disappointed at this point," said Ms. Barnes, 27. "We buy stuff on eBay all the time with no problem, and this was a great price."
Ms. Smith had received more than 250 positive comments from past purchasers on the auction site, which allows buyers to leave positive or negative comments about auctioneers, Ms. Barnes said.
So they didn't worry when Ms. Smith requested payment by wire transfer, rather than by PayPal, an online payment system that provides protection to online buyers, Ms. Barnes said.
"She stayed in contact with us," Ms. Barnes said. "She told us there was a problem with her distributor, and then that she might go out of business. But she stayed in communication with us, so we didn't think she was ripping us off."
Then Ms. Smith sent all of her clients a group e-mail, Ms. Barnes said.
"She told us her attorney advised her not to communicate with us, and she stopped communications," Ms. Barnes said. EBay has since revoked Ms. Smith's privileges to sell items on the Web site.
Ms. Smith did not return phone messages left on her cellphone. Her lawyer also did not return a call seeking comment yesterday.
Jason DeVries of Los Angeles, who said he used to work with Ms. Smith on the West Coast, said she recently told him she wants to resolve all of the complaints against her. Mr. DeVries said he has severed his ties with her companies.
"She did say she's trying hard to rectify it," he said.
Mrs. Sinnott said she was able to reach Ms. Smith earlier this month. Ms. Smith has stopped returning all calls to her phone numbers since then, Mrs. Sinnott said.
"I have spoken with Teresa Smith, and she claims it is a misunderstanding and she is trying to make good on her offerings, but the problem continues," Mrs. Sinnott said. "I did warn her she could be facing jail if the scam continues."
Ms. Barnes, however, said she would rather see Ms. Smith ordered to pay restitution.
"It's all well and good that justice be done and all that, but I want my money back."