April 20, 2002 When an eBay seller fails to deliver, new Macintosh buyers get iMad. There is much more demand for the new flat screen iMacs than there is supply. Computer stores have backorders for up to six weeks on the most popular models. So when Mel Knowles of Santa Barbara, CA, saw the model he wanted on an eBay auction from ShadowSB, LLC., he snapped it up for $1594, and paid by Certified Cashier's Check since the seller wouldn't take credit cards or any of the common forms of electronic payment. Many other on-line shoppers familiar with eBay's strict rules of e-commerce did the same. Weeks went by, then months, and no iMac. Knowles complained to the seller listed as Smith Berkeley Communications LLC and Bulletproof Industries, and their owner, Teresa Smith. Finally, after two months of emails and phone calls, he was sent a refund check for the full amount of his purchase, and it immediately bounced due to insufficient funds. Knowles figured he wasn't the only one who got burned, so he did some research and discovered a "support" group of consumers that were ripped off by the eBay seller. As of April 24, 2002, 70 people in the iMad support group reported: $190,390 in total purchases from 12/11/01 through 3/15/02 $ 52,883 in total refunds (17 confirmed refunds) $137,507 outstanding balance (53 outstanding refunds) Purchases ranged from $1,594 to $7,800. 33 people have received a total of 43 bounced checks totalling $122,634 that have been confirmed. A number of folks are holding checks they can't cash. Knowles thinks there are many more unfulfilled buyers out there who have not found the group. To make matters worse, anecdotal evidence has surfaced that eBay may have been aware of the seller's shoddy history but continued to allow her to sell on its on-line auction service. In fact, it appears eBay even contacted the U.S. Postal Inspector a full two months before shutting down ShadowSB. By the group's estimation, eBay collected over $4,500 in fees from ShadowSB. Unfortunately, their consumer fraud guarantee only protects the first $200 of purchases. To make matters worse, eBay has now prohibited its members from even discussing potential fraud on its online discussion boards. Read more at http://msn.com.com/2100-1106-885783.html. At least two iMad group members report having been defrauded in other recent eBay computer auction scams. Apollo in Nevada wrote, "The only reason I used eBay was I thought that with all their P.R. and hype it would be a safe transaction. I truly believe that eBay is more concerned with profit than with security." As a result of the consumer mini-revolt, the seller is now being investigated by USPS Inspectors and the Fraud Division of the FBI along, with several local agencies in Worcester, Mass, the headquarters of Smith Berkeley Communications LLC and Bulletproof Industries. For many of the buyers, this has been a real financial hardship as they were counting on new computers for their work and now have neither computers nor their money. Depending on the model ordered, many are out $3,000 or more. Was it an offer too good to be true? Knowles and other iMad buyers are beginning to think that's the case. In the meantime, he bought a new flat screen iMac from another eBay seller, and it was delivered as promised. Media designer Steve in New York has not been so lucky, "With four young boys and a baby girl, it's been tough to say the least. But the Lord has gotten us through. I didn't (and still don't) have enough cash set aside to purchase another system while waiting for this situation to be rectified. As you know, marital relationships seem to work much better without the extra stress of misappropriated finances too." Has ShadowSB auction e-fraud reached your friends or business associates? If so, ask them to contact the iMad support group at iwantmymoneyback@yahoogroups.com. ### Additional Information The following appeared in the Worcester (MA) Telegram & Gazette (MA) on March 26, 2002. Area computer sales scam is alleged The Better Business Bureau of Central New England is warning consumers to be wary of buying computers on the Internet from unknown companies, including companies in the Worcester area. The warning comes in the wake of computer shoppers losing thousands of dollars in an online scheme operating in this area, according to a BBB alert issued Friday. The Better Business Bureau of Central New England, with an office in Worcester, has received 31 complaints from all over the United States and Canada against a company operating under several names, including Smith Berkeley Communications LLC and Bulletproof Industries, and their owner, identified as someone named Teresa Smith. The companies are in Boylston, West Boylston and Worcester. The companies reportedly sell computers online through eBay, an online auction service. When a winning bid is accepted, the bidder is required to send payment by cashier's check or money order through Federal Express. In all 31 instances, the buyer did not receive the computer, contacted the company and was sent a refund check that bounced. The complaints allege losses of $2,000 to $4,000 per person. The companies have not responded to complaints and have an "unsatisfactory" record with the BBB, according to a BBB alert. The alert was issued after the BBB spoke with area police departments and determined the problem appears to be growing and losses mounting, according to the warning. Telephone calls during the past several days to a West Boylston number listed in the telephone book as Smith Berkeley Communications were answered by voice mail. A message was left for "customer service," but it had not been answered by yesterday. The voice mail message also said a directory of company employees could be obtained by pressing 1, but when the number was pressed another message said there was no such extension. Barbara J. Sinnott, president of the area chapter of the BBB, cautioned consumers considering online purchases to be extremely careful and learn all they can about unknown companies before placing orders. When considering buying anything on the Internet, the BBB said, consumers should use a credit card that allows 30 days to dispute a charge. If the company only accepts personal checks, cashier's checks or money orders, there is usually no way to get money returned if a problem occurs, according to the bureau. Consumers should always learn where a company is physically located, what its sales terms are and how to contact it offline.