Posted on: Saturday, January 8, 2005
Thieves use eBay to sell stolen-item vouchers for cash
By Ariana Eunjung Cha
Washington Post
SAN JOSE, Calif. — Stealing the merchandise was the easy part. The ring of young men and women had become pros at snatching cashmere sweaters, perfumes and other expensive items from the likes of Abercrombie & Fitch, Victoria's Secret and Pottery Barn.
• A ring of young men and women would shoplift cashmere sweaters, perfumes and other expensive items from high-end retailers.
• The shoplifters discovered that some stores would allow them to return the goods without receipts for store credit or gift cards. • They then sold the vouchers anonymously on eBay, taking in an average of 76 cents per dollar of stolen merchandise. • The group made more than $200,000 in 10 months before its members were caught. Soon they hit upon a solution: eBay.
The Silicon Valley-based auction house has become a fabulously successful mechanism for sellers of all kinds: mom-and-pop jam makers, collectors of fine antiques, people who just want to make a few bucks off the stuff collecting dust in their basement. With its global customer base of more than 100 million and software that allows strangers to exchange goods and money without ever meeting, it has maximized profit for its retailers.
It has done the same for thieves.
The shoplifters discovered that some stores would allow them to return the goods without receipts for store credit or gift cards. They then sold those vouchers on the giant online marketplace. It was easy, instant and anonymous. The money flowed in — they got 76 cents per dollar of stolen merchandise, a huge takeaway considering that shoplifters traditionally net 10 percent or less of the retail value of the items. The group made more than $200,000 in 10 months.
Breaking up the store-credit-for-cash scheme involved a massive, yearlong sting that took authorities across five Northeast states and required them to mine hundreds of computer files, conduct secret surveillance at stores and place an agent undercover to infiltrate the ring.
In late December, Herion Karbunara, 25, pleaded guilty to organizing the scam. He received two years in jail. Two accomplices — Lindsey Holland, 20, and Helen Macy, 21 — received probation for returning stolen items to shops to collect the store credit. Anne Leeman, 39, also accused in the scheme, pleaded guilty the previous month. Charges in the case are still pending against Christine DeGrandis, 33.
The problem was how to turn the goods into cash. Hocking the wares on the black market was out. They didn't have the contacts. And any attempt to return the goods for refunds would probably be rebuffed without some proof of purchase.
How the eBay scam worked
