George Mason University
INFS-640 (E-commerce)

An Analysis of eBay


8. Ethical, Social and Political issues of eBay

The unique features of internet have made e-commerce successful but also brought some problems to surface. For example ubiquity – anytime, anywhere access to internet – has made it difficult to protect copy rights of music industry and on the social side pornography has become widely available and parents are finding it difficult to protect their children against it.
Ethical, social and political issues cover four areas – information rights, property rights, governance, and public and welfare. All these aspects influence business on eBay. Some times law is one step behind e-business and there is a gray area what is legal and illegal. Recently in February immediately after space shuttle Columbia disaster, some individuals who picked up debris put it up for sale on eBay within an hour after the disaster. eBay deleted those listing immediately and reported them to FBI. eBay uses automated systems to monitors listings. In the case of Columbia disaster, there was an existing law that was highlighted and enforced which makes it illegal to removal any parts of an aircraft accident is punishable up to 10 years in prison and $250,000 penalty [22, 23].
But it is not always possible to enforce the law as in some cases the email addresses and phone numbers on the file may be fake. Thus accountability of some actions on internet is difficult to find and enforce even within United States and more so in a foreign country where it may not be illegal.
Privacy of information is extremely important for eBay. Several e-commerce sites are using cookies to profile the behavior of customers that some feel it is invasion of their privacy [24]. Some spammers harvested email addresses from auction sites and eBay customers are receiving illegal spam from those who obtained those addresses illegally. This undermines the credibility of eBay as customers could not differentiate the authenticity of email requesting information.
Our group tried to test whether PayPal system, which is one of the payment methods on eBay, is spam proof. We were able to send an authentic email without any trouble. We were surprised the vulnerability of eBay to spoofing. Please refer to the section on Security.
eBay purchased anti-fraud software called FADE (Fraud Automated Detection Engine) which was installed a year ago by an San Jose-based company. It was not meant to be a panacea. FADE collects data from defrauded customers and alerts the team of fraud busters at eBay. This team matches patterns of known scams through raising red flags on potential transactions. For example a new user with large quantities of very expensive merchandize is a candidate to flag. This may include stolen diamonds to be sold on eBay or stolen foreign art crafts. During March 3rd week of 2003, a couple from Arizona cashed out the bank account of more than 500 bidders worth $100,000 and fled. Robert Beck, a 25 old engineer was victim of the scam. He casted a winning bid on a top-of-the-line speaker system for $1,900 which he paid by credit card and waited for his first eBay purchase which never arrived. These kinds of spams casts doubt on eBay’s credibility. It is true that no system is full proof from hackers but when it affects several innocent buyers on eBay, it turns away customers [25].