Thursday, October 30th, 2008

Introducing Rich LaMagna - eBay Online Safety Advisor

I wanted to take a moment on Ink to introduce you to another member of the eBay team. Rich LaMagna is eBay’s Online Safety Advisor and I managed to spend a few minutes with him earlier this week to talk about what he hopes to accomplish here.

Rich has an interesting role for the company in that he is essentially for “Trust & Safety” what Constance White is for fashion; Karen Bard is for pop culture; Cat Schwartz is for tech/gadgets; and what Shawn Henderson is for home design (to read more from our Style Squad team, be sure to check out http://ebayinsiderblog.com).

I’ll definitely ask Rich back onto Ink for more detailed conversations (let’s hope we can encourage more folks here to do the same), particularly going into the holiday shopping season, but for now I wanted to take the time to introduce you to him and provide a little background.

1. Rich, thanks for taking the time here on Ink. Before we get into some of your goals and responsibilities could you please tell folks a little bit about your background? What makes you the ideal person to be eBay’s official online safety advisor?
Hello Richard, I am delighted to be here and very excited about my new role. My background of 27 years in federal law enforcement (Drug Enforcement Administration and FBI) coupled with my previous positions at Microsoft as a Director of Worldwide Anti-piracy Investigations and Director of Law Enforcement Training and Outreach (the Internet Safety Team), have given me the right combination of experience and insights to understand the challenges that eBay faces on a daily basis. In addition, as spokesperson for anti-piracy and Internet Safety at Microsoft, I played a key role in educating the general public about counterfeiting, fraud and online safety.

On a personal level, I have lived in and traveled to many countries where I’ve enjoyed shopping in all kinds of situations and learned some good lessons about how to stay safe –many of those lessons apply to online buying and selling. All of this experience means that the eBay Community and consumers in general should know that when I provide tips or suggestions for staying safe online, they can trust it 100%.

2. How do you plan on promoting consumer safety online?
I’m very eager to spread the word about some important changes that eBay has adopted in order to improve consumer safety, including the end of paper and non-electronic payments and the enhanced PayPal Buyer Protection Program. In addition, we advocate that shoppers use their common sense when shopping online, just as they would when shopping in a mall or department store. Most of us, consciously or not, run through a mental checklist before making a purchase: Am I comfortable shopping in this store? Is this item the correct size, price and color? What payment method should I use? What are the return policies, etc.? We should apply these same criteria to online shopping, using our common sense, to ensure a safer shopping experience. Just as you wouldn’t shop in an unsafe part of town from an unknown merchant selling goods of unclear origin, you should exercise the same caution online.

I’m confident that if shoppers use common sense before making a purchase plus take advantage of the PayPal Buyer Protection Program, under which qualified purchases are covered 100% against fraud, they will be taking the steps necessary to ensure a safer online buying experience.

3. What are the near-term challenges you face in your role at eBay?
As you and the eBay buyers and sellers know, Richard, there have been quite a few changes on eBay.com in the past few months; I firmly believe they will help to provide buyers with a better and safer experience as well as help sellers grow their businesses. I know everyone is making an effort to adapt to these changes, which come with a little discomfort, and over the coming months I will be specifically talking more about these features and all the great things that eBay is doing to make the online experience safer. Although I am fairly new to buying and selling on eBay, I am beginning to appreciate the challenges that both sellers and buyers sometimes face and I have already experienced a few things that have convinced me that eBay is making the right changes.

I want to be able to maintain a level of objectivity and let both eBay and the eBay Community benefit from my years of experience in the online security industry. Since I am involved with other industries, I can help to set the wider context by commenting on how eBay is tackling industry-wide online security issues in comparison to their industry counterparts. I plan to use my position to help educate the media and give guidance to consumers about what simple things they can do to make themselves safer online.

4. What is your long term goal for eBay in the area of online safety?
Let me be bold here and say that my ultimate goal is to help make eBay the absolute safest and best e-commerce site in the world! eBay is a great company and what attracted me to it was its foundation on an ideal which is still the guiding principle: trust, the idea that most people are basically honest and trustworthy, even when transacting with one another online. eBay takes its responsibility very seriously and there is a lot of great work being done at eBay to provide buyers and sellers with a safe, fair, buying and selling experience—as you know, the vast majority of eBay transactions are secure and very successful.

My long-term goal is to help get the word out on the good behind-the-scenes work the eBay Trust & Safety Team is doing and to clearly articulate how eBay is addressing issues as they arise—this should help give buyers and sellers a greater level of comfort and confidence in the entire system built on trust. I also want to promote the idea of collaboration and shared responsibility because if we all work together to adopt the new changes and follow a few common-sense guidelines, the eBay experience can become even more fun, efficient and above all, safe!

5. Do you have any tips or advice for buyers/sellers heading into the shopping season this year?
Yes, shopping online will be a great way to shop this holiday season. I personally prefer it – I’d rather not spend my time sitting in traffic and then waiting in long lines at the stores. Especially with gas prices so high and often nasty winter weather conditions, the easiest and most efficient way to do your holiday shopping is on eBay. As I mentioned, I’ve shopped all over the world for unique and interesting items and thanks to eBay, with a few clicks of the mouse many of those same items are now available with an even greater selection at discounted prices from trusted sellers. You can have them delivered right to your door within a few short days—how convenient is that! Buyers and sellers should check out the PayPal Buyer Protection Program and remember these tips for staying safe when shopping online:

• Get to know who you are transacting with. Communicate with them and research their reputation by checking their feedback rating.
• Pay safely. Pay with a fast, easy and secure payment method such as PayPal. Do not pay with paper payment methods such as checks or money orders, cash or instant cash transfer services such as Western Union or MoneyGram as they are proven to be unsafe for online transactions. With PayPal’s enhanced Buyer Protection Program, all qualified purchases are covered 100%.
• Never be tempted to trade outside the safe confines of eBay. You are unprotected in such transactions and more susceptible to fraud.
• Never click on a link or reply to e-mails that ask for personal information. eBay and PayPal will never ask you for your account or credit card details, username or password in any communications.
• Download toolbars such as Internet Explorer 7.0 or Firefox. These help to identify when you’re on spoof sites and protect you against clicking on fake eBay and PayPal websites.

6. Would you be willing to come back and be a recurring guest on Ink so we can provide updates to readers?
Yes, I would be delighted to appear as a recurring guest to share my expertise and provide more information on eBay Trust & Safety issues for the Community. Thank you for this opportunity!

Cheers,
RBH

Tagged: consumer protection, customer protection, ebay, ebay inc, ecommerce, online safety, online shopping, paypal, Rich LaMagna, trust and safety

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17 Responses on this post. Click to add yours.

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Chris @ TameBayOn 10.30.2008 at 10:43 am Said:

Hi Rich and welcome - a question for you:

Passwords - “Change them every 30 days” is the perceived wisdom, along with make them secure so something like G1&h5Q*p which quite frankly is impossible to remember, especially when users are likely to have maybe 30 or more log ons for which they’re advised to have separate passwords for each site. It would take a mentalist to remember 30 times Gh&l51*p and then relearn a different set the following month without writing them down on a postit stuck to their monitor!

So is it better to have a really secure password for each site that you remember, but don’t change, or to have an easy to hack password that you change every 30 days?

(PS we don’t have the PayPal security key available in the UK 2 years after it launched in the US. Is it not that good after all or are we just not worthy? )

HenriettaOn 10.30.2008 at 11:54 am Said:

Hi Rich

I understand the stated reasons behind anonymization of bidder identities. Many long time eBay users, buyers and sellers alike are of the opinion that it has facilitated shill bidding. Some of us have submitted evidence to that effect to T&S and occasionally seen sellers NARUed shortly after. The latest phase of this program will make it impossible for concerned users to be proactive in this regard.

1.What does your data show and have you seen any rise in shilling?
2. Given that soon all communication will be through anonymized eBay email addresses why is this bidder anonymization even necessary?
3. Are you aware of the fact that collectors used to be able to find items of interest by tracking fellow collectors of similar items and that resulted in increased bidding, much higher prices all round?

Thank you.

Henrietta ‘99

rlamagnaOn 10.30.2008 at 12:45 pm Said:

@Chris@TameBay Thank you for the welcome and for sending the first question!

My advice is that having the strongest password possible should be your first priority – this is your first line of defense against fraudsters who may be able to guess it. Along with that, don’t click on the “save password” option that some web sites, webmail and shopping sites provide you – that makes entry into your account that much easier!

Changing your password often should be your second line of defense – most experts recommend every 60 to 90 days, but I’d recommend taking it even one step further and changing your password every 30 to 45 days. Changing your password often and having to remember numerous passwords can be bothersome, but it’s not as much trouble as what can result if someone does get a hold of your password.

I spoke to the folks at PayPal about your Security Key question and they tell me that based on customer response to the Security Key’s initial rollout, they are looking forward to offering it in other countries, but these things take time. Stay tuned!

Thank you,
Rich

AmberOn 10.30.2008 at 2:38 pm Said:

Welcome Rich.

I still fail to see any mention of how SELLERS are safer with online payments.

The reason?

They aren’t.

Paypal’s recent history regarding automatically granting each and every SNAD in favor of the buyer has caused most sellers of high-fraud items to leave the site.

I understand the need to make sure sellers are accurately describing their items. What I don’t understand is Paypal’s complete lack of initiative in investigating those claims. There is no response to obvious switcheroo scams, no response to cases where buyers return merchandise without approval but with DC on buyer’s remorse issues.

I further challenge Paypal’s safety in that Paypal does not accept offline delivery confirmation but instead demands proof of delivery that is viewable online. Most credit card companies will accept faxed copies of other OFFLINE proof. Paypal will not.

Paypal remains and extremely UNSAFE payment method for sellers–

Paypal has a monopoly on the site now. Propay is not a suitable alternative for low volume sellers. Neither is a merchant account. That leaves Paypal only for thousands of small sellers.

Rich, as for this:

“Never be tempted to trade outside the safe confines of eBay. You are unprotected in such transactions and more susceptible to fraud.”

Let’s be honest now. This has nothing to do with safety. It has to do with eBay’s bottom line. If a buyer pays for something via Paypal with a credit card as a funding source, but off eBay, they are just as protected as someone who buys that item on eBay.

I wish you luck, Rich, in your new post. I hope to see more REAL fraud addressed. Perhaps something to help the thousands of defrauded sellers who are dealing with an explosion of fraud since the new feedback rules started.

GailOn 10.30.2008 at 3:36 pm Said:

I must be missing something here. This reads like an advertisement for PayPal.

“I played a key role in educating the general public about counterfeiting, fraud and online safety.”

STEP 1: eBay’s primary concern should be ridding the site of the counterfeit and fraudulent listings, NOT educating the public to avoid them. Then, and only then, will the site be safe. Until that’s done, all the education in the world is not going to make a bit of difference. It’s certainly not going to change eBay’s reputation.

“Let me be bold here and say that my ultimate goal is to help make eBay the absolute safest and best e-commerce site in the world!”

Read STEP 1.

rlamagnaOn 10.30.2008 at 5:54 pm Said:

Hi Henrietta,

Thank you for sharing your concerns with us—we know that while this initiative has been successful in protecting bidders from fake Second Chance Offers and Checkouts, there are some downsides as you have noted. These changes helped to virtually eliminate fraud at that level and we are not seeing any fake SCOs.

With regards to shill bidding: quite frankly, we had to weigh the pros and cons of the small potential incidence of shill bidding against the larger potential for fraud.

In the auction format, some undetectable shill bidding can occur. However, since shill bidding only increases their costs and risk of losing their eBay account, it is fortunately, not all that common. For the incidences of shill bidding that we can verify (based on matching account information), we take immediate action. One thing is certain: eBay’s own data on verifiable shill bidding shows a marked decrease over the last few years since the inception of the policy.

Regarding the need for anonymization of winning bidder IDs we found that fraudsters would grab the Winning Bidder ID (since it wasn’t hidden) immediately after the auction ended and send the winning bidder “Fake Checkouts” before the real seller could. While the bidder IDs may be useful in tracking fellow collectors, unfortunately, they are also useful to fraudsters for various types of mischief. Anonymizing Winning Bidder ID eliminates this problem and prevents an interception of the transaction.

Another advantage of masking and anonymizing IDs is that they will not be vulnerable to spoofed emails or to spam and phishing attacks. We strongly advise members not to select a user ID that is similar to their email address, since fraudsters are good at figuring out email addresses, often by trial and error. Members should never click on links in those emails or respond to requests for personal or account information.

We are firmly convinced that the added security for our members is worth the inconvenience or downside of not knowing the bidder IDs. However, if future policy and product changes should affect the way buyers and sellers interact, we would always be prepared to revisit the issue.

Thanks again for your questions.

Rich

Chris @ TameBayOn 10.31.2008 at 5:12 am Said:

Hi Rich, thanks for taking the time to answer. Passwords really are the bane of my life as I expect they are for many other people as well.

I’ve already got a PayPal security fob (two actually… I picked one up at eBay Live! in Boston and a credit card format one in Chicago) so I’m all set to go as soon as it’s rolled out internationally. That’ll for sure make eBay and PayPal more secure for me

Cheers
Chris

rlamagnaOn 10.31.2008 at 11:29 am Said:

Chris,
You are most welcome!
By the way, sorry that I didn’t completely address your point about the difficulty of remembering complex passwords. To be strong a password doesn’t have to be an unrelated jumble of characters and symbols—it can be something that has meaning for only you that others would be unable to easily guess. I know this one will draw fire from code breakers out there— for example, a random combination of names of streets in a town where you once lived using upper and lower case letters coupled with symbols. You might also write down just a hint of the PW as a reminder that would have no meaning for others.
Lastly, aside from strong PWs, I would strongly encourage ebayers to not use IDs similar to their email addresses, not have an email address easily discernible, such as csmith@hotmail.com and make sure that you are using a good firewall and anti-virus protection.
Thanks again for your questions.
Rich

rlamagnaOn 10.31.2008 at 11:33 am Said:

Hi Gail,

Thanks for your response and concerns about counterfeits.
You make an excellent point which is that addressing counterfeiting requires a multi-pronged approach– not only consumer education but also strong criminal and civil enforcement. In my former role as Director of Worldwide Anti-piracy Investigations at Microsoft, I quickly learned that the only strategy that really works is an integrated approach where everyone has to do their part, including the consumer. eBay works with over 18,000 Intellectual Property Rights owners through the Verified Rights Owners Program (VERO) to rid eBay of counterfeits. We have over 2000 fraud specialists who monitor transactions for evidence of fraud and also work closely with law enforcement. They have been successful in reducing fraud visibility by about 80% over the past year. However, it is important that buyers exercise some basic common sense practices regarding listed items—the old adage, “if it looks too good to be true, then it probably is” still serves us well.
Rich

rlamagnaOn 10.31.2008 at 1:32 pm Said:

Amber,

Thanks for your comments.

I’ve been spending some time with the PayPal team since I’ve been on board. PayPal is one of the safest payment methods online with the payment industry’s lowest fraud rate and the only system that offers the kind of protection that they do with no cap and no annual coverage limit on eligible transactions— and compared to what I’ve seen over the years, that’s pretty good protection!. PayPal’s been around for a long while and grown up with the Internet and payments industry and is uniquely positioned to take on the ever-changing challenges of online fraud—this is what PayPal does best. Nevertheless they are always looking for ways to improve; PayPal has made a number of changes this year to enhance PayPal Seller Protection in response to specific requests from eBay sellers — increasing the number of markets covered, removing the coverage limit, removing the confirmed address requirement, and making it easier for sellers to provide proof that they sent the item. We appreciate your concerns about SNAD and I’ve been assured by the team that PayPal is looking at ways to improve seller protection even more, including better protection for SNAD. It’s important to keep in mind that PayPal is a payment company, which means it doesn’t handle or see the millions of items of merchandise shipped each week. Like other mainstream payment providers, this model makes it extremely difficult for PayPal to intermediate in all types of cases. If eBay or PayPal becomes aware of fraud or that individual buyers are abusing the system they will take action against them. eBay has over 2000 anti-fraud experts working around the clock on all types of fraud. Otherwise, they encourage buyers and sellers to work with each other directly or via the PayPal Dispute Resolution console.

With regard to trading off eBay using PayPal, you do not get full buyer protection and generally when you are trading off eBay, you are vulnerable to other types of scams. It’s always recommended to stay on eBay and use PayPal because it is fast, convenient and safe.

Thanks again for writing.

Rich

JJHOn 10.31.2008 at 3:51 pm Said:

All I hear in these replies are “the party line” as if it’s been scripted in advance.

Why not just REMOVE the “high bidder” line on the item page, and the “list of bidders” completely? They are absolutely useless now and serve more of an annoyance to everyone, and display the arrogance of eBay more than anything else. Just display this information to the seller, and take it away for anyone else. You’ve already taken it away, please, just remove it so it doesn’t even show.

JTOn 11.01.2008 at 2:18 pm Said:

Since you are a trust and safety guy and there is mention of PayPal, would you please explain the latest PayPal issues that have not been announced on any PayPal or eBay system announcements board yet?

This issue is causing problems for thousands of people worldwide.

PayPal is holding money under the guise of unlaimed eChecks.

Sellers get a note like this:

Don’t forget to claim your money from (buyer name)

Dear (Seller’s name),

Claim your cash

You received $4XX.XX USD from (buyer email) on Oct. 26, 2008. If you do not claim your money by Nov. 25, 2008, this transaction will be cancelled and the money will be returned to (buyer email)’s account.

You need to manually claim this money because:

You are one of our high-volume customers. We ask PayPal users who receive more than $10,000.00 USD per month to complete our Supplemental Merchant Information form.

To fill out the form, click the link below:
Link to PayPal US

The information you provide helps us protect the integrity of our network. Payments sent to your PayPal account will be held as “Pending” until you complete this form.

If you have questions about this payment, log in to your PayPal account and click on the History subtab. Click the details of the payment in question for more information, or to accept or deny this payment.

Thank you for using PayPal!
The PayPal Team

Please do not reply to this email. This mailbox is not monitored and you will not receive a response. For assistance, log in to your PayPal account and click the Help link in the top right corner of any PayPal page.

PayPal Email ID PP288
—-
Most of the sellers that come to the boards to complain about this do not make $10,000 a month so that is a lie as to being the reason that they are putting a hold on the funds.

What is worse is when you try to “claim” these funds, there is no way to do so.

This has been going on for more than a week and in some instances, the sellers are waiting for fairly large sums of money to be released.

All the while, someone is collecting interest on this money that was paid to the seller BUT it isn’t the seller collecting interest on it.

Buyers are getting no notice about what is going on. If they check, they will see that the amount is “unclaimed” and all they know is that they are waiting.

We don’t know why this is happening for sure but the one thing we do know is - sellers stand to lose on the feedback & DSR’s and PayPal is collecting interest on our money.

Check eBay’s PayPal discussion board for more about this as it is also holding up other methods of payments. The title of the thread is “Can’t claim cleared eChecks!”

Is this a PayPal glitch or have our accounts been compromised by a disgrnatled laid off employee (the timing of this is suspicious)?

Ann1On 11.01.2008 at 10:29 pm Said:

I really don’t see where shill bidding could be any less than what it has been all along. Afterall, the seller definitely won’t turn in a shill bidder and they’re the only ones who can see the ID’s. Really, the only difference I see is that now we can no longer report suspected shill bidding! As for Ebay watching for shills?….please…(insert whatever you like here) Bottom line, once again, as an old time seller sees it masking ID’s is only to keep second chance offers from being offered to bidders by scammers.

HenriettaOn 11.02.2008 at 8:58 pm Said:

The cure for fake SCOs is to drop them. I have had very little response to SCOs because people don’t trust them, and rightly so.

Drop SCO, stop PayPal from sending emails with clickable links and the problem goes away.

AmberOn 11.02.2008 at 11:35 pm Said:

Thanks for your responses, Rich.

Here are my follow ups

If you pay via Paypal off ebay and use a credit card as your funding source, you are just as protected. Why? Because you have your chargeback rights through your CC provider if Paypal doesn’t honor their protection guidelines.

As for convenient, the NUMEROUS issues with Ebay checkout and Paypal coupon codes lately have not made paperless payments very convenient.

And Rich,

If eBay or PayPal becomes aware of fraud or that individual buyers are abusing the system they will take action against them

The sellers are understandably concerned that the shielded bidders id will make this type of fraud even more difficult to detect.

Here’s the bigger issue with the SNADs. Since they are now included in the Seller Non Performance calculation, buyers are extorting sellers at breakneak speed. They threaten sellers with SNADs in an attempt to extort a partial refund. They are not happy with returning the item (since they really want a post-purchase discount) and know the negative consequences sellers face if they get too many disputes filed against them. So they threaten them. And since this happens post-transaction, all complaints sent to ebay are seen as ‘dissatisfied buyers’ rather than the extortion that really takes place.

I’d love to see the percentage of SNADs that are decided IN THE SELLERS’ favor. I bet it is miniscule. Paypal seems to have dropped the ’significantly’ part of the clause entirely when reviewing disputes.

Finally, the expanded seller protection for international transactions is absolutely meaningless in an environment that includes Detailed Seller Ratings.

The only way to get protection against Item Not Received complaints internationally is to ship by the most egregiously expensive methods available that result in either excessive brokerage fees (if sent by carrier) or excessive postage (if sent Express Mail).

Neither option is really viable when buyers can rate sellers on shipping charges that are set by the carriers. Consistently poor DSRs, even if shipping at cost, can result in the demise of an eBay business.

So, for most of us who ship internationally, the fine print in the SPP renders any protection illusory.

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