Do you trust eBay with your Social Security number?
In order to sell anything on eBay, you will need to provide your social security number. Is it safe?
Starting February 1st, 2021, eBay requires your Social Security number and a checking account for all sellers. Allow me to share with you my recent experience selling on eBay to help decide if it is worth providing this info. Given the company’s spotty track record, there are some things to consider before willingly giving up your Social Security number. If enough user’s decide not to, will this new requirement be the nail in the coffin for eBay?
I’ve never been a so called ‘Power Seller’ on eBay but I have occasionally sold an item or two on the platform. In recent times, eBay has increasingly become a haven for scammers and fraud. What used to be a semi-reputable auction house has essentially become a fraud free-for-all. As a result, eBay has tightened its requirements but is it too late?
Auctioning my PS5
Just before the holiday season last year, I was able to get my hands on a PS5. You would have to be living under a rock to not know that those consoles were selling for 2.5x to 4x times their original price on eBay. It is no secret anyone with some luck and an eBay account was able to profit last season. Let’s be real, I only managed to wrangle one console from Best Buy. I was not by any definition a scalper. It just so happened I was an Xbox fan who owned a PS5. I essentially wanted to sell my PS5 so that I could purchase the new Xbox Series X.
Naturally, I listed my unopened PS5 on eBay, took several photos of the sealed box and decided to start my auction at a market price $499 (disc version) for 7 days and let the market dictate what the value of the console was actually worth. Low and behold, I got my first bid within 24 hours and I was stoked. Even eBay sent me an email with the subject “your item will sell.” Within a matter of hours I had over 100 views. I could hardly wait for the next 6 days for the auction to finish.
My eBay account was nothing spectacular. I had opened my account back in 2012 with a main purpose of buying items that I needed which were not available through retailers. Perhaps once a year (if that) I would come across an item I no longer needed that had some value that I wished to sell. It was great because I was able to recoup some of the original value of the item and it wouldn't just wind up in the trash bin due to space constraints in my apartment.
Here I was, an average Joe with a listing that 2 days later had over 500 views and 23 watchers. It was surreal. With more than 3 days to spare, I was already up to 4 figures for the current bid. I would have never guessed it, as far as I was concerned, there was no bad faith so I was ecstatic that someone was willing to pay at least twice the value of the console.
The next two days there wasn’t much traction, sure the views stockpiled and the watchers hit over 30 but not much in terms of actual bids. Made sense to me cause who would actually pay more than 2x the original price tag. Well, that last day, there were numerous bids throughout the day. With less than 2 hours left, the bidding war had exceeded $1,500 (over 3x the original value). I was astounded and couldn’t wait to see the final price of the auction.
Within the final 3 minutes of the auction, the bidding went from $1,500 all the way up to $1,800. I started to think, that was enough money to invest with. Then it happened.
The final winning bid reached $1,835.00. Excited, I read eBay’s email and did as they suggested. I sent the winning bidder an invoice. Later that evening, I couldn’t help myself, who was this anonymous bidder? My mind went on to assume that some corporate executive really wanted to get his or her son/daughter a PS5 for the holidays. That was the only rationale explanation I could think of.
The next morning, I still hadn’t heard back from the winning bidder and that’s when I started to look more closely at the user. Turns out, it was what could have been a legitimate username followed by a ‘_0’. I thought that was a bit strange, even worse, there was a big fat zero in parentheses next to their username meaning the account had literally no feedback. That’s when I started to worry. Would someone rush to create an eBay account for the first time just for a chance to bid on my PS5 because it was that important to them? Seemed highly unlikely to me.
Unsurprisingly, another day had gone by and zero communication from the buyer. Unfortunately for me, eBay has a policy where it takes 48 hours before I can cancel the sale due to buyer inactivity. I waited and sure enough, the buyer never paid. eBay was apologetic and allowed me to ‘relist’ the item for free. They also recommended I award the second highest bidder the winner, however, by that time the second highest bidder already moved on to another listing.
Déjà vu — relisting
I decided it was a fluke and relisted the item. Just over 24 hours into the auction I received another bid for what was only $150 over market value. Only this time I noticed, it was by another user with zero feedback. I immediately contacted eBay and they recommend I adjust my ‘Seller’s Preferences.’ I set my preferences to the highest standards I could set. Confusing lingo but I set my preferences to not sell to buyers who:
- Have received 2 Unpaid Item strike(s) within 12 Month(s)
- Have a primary shipping address in a location I don’t ship to
- Have a feedback score of -1 or lower
- Are currently winning or have bought 1 of my items in the last 10 days and have a feedback score of 0 or lower
I was satisfied and convinced myself that I had thwarted the ‘bad guys.’ Figured it was my fault for not tuning my settings. Less than 12 hours later, another bid came in from a user with zero feedback. I contacted eBay again via chat and was informed how I could block users of my choosing. I thought it was a great idea and went to sleep soundly that night. The next morning, I woke up to 5 more bids, all by users with zero feedback. What started as 1 or 2 bad actors soon became a game of wack-a-mole. My morning ritual included canceling bids from users with zero feedback and adding their usernames to my list of blocked users.
This time, by auctions end, my PS5 fetched over $1,400. Not bad, except for the fact it was run up by a bunch of fake users with no intention of actually paying. I reached out to eBay yet again via chat to discuss my frustration with illegitimate users. I questioned, how can they allow this type of behavior on their platform? I was assured that eBay was working on several ‘fixes’ to prevent users from creating accounts so easily. Let’s be real here, it was 2020 and most businesses now require at least a phone number or some other type of verification beyond simply an email address.
After going back to eBay support yet again, I was encouraged by the representative to convert my account to a business account in order to gain better control over the buyer requirements. Apparently, there were additional buyer criteria that only business PayPal accounts could set. Let’s be clear, selling 2–4 items a year casually on eBay does not constitute me as a ‘Power Seller’ let alone was this a good enough use case to start an LLC. Something tells me, there is an incentive on those types of accounts from eBay’s perspective. I declined their ‘recommendation’ and decided to fight the good fight and continue to block fraudulent zero feedback users.
I got the impression that it wasn’t such a technological feat to implement such safeguards. eBay is a huge company with over $10 billion in annual revenue for 2020, surely they have plenty of resources. I was disappointed, what I thought was a company with legitimate business practices, would let someone such as myself with no ill intentions be at the mercy of fraud and potential hackers.
eBay’s track record
What’s more is if you do your homework, you will find numerous successful hacking attempts on eBay specifically. In this case, their track record precedes them, and not in a positive way. How could a business with such bad ethics and little concerns for its users make billions of dollars in revenue per year? eBay was starting to have the makings of ‘too big too fail,’ which let's be real, no one truly needs eBay. Were they one of the pioneers of the internet? Sure, but the same could be said of Lehman Brothers and well, look at them…
Back in 2014, eBay suffered one of the worst data breaches of all time.
“Some 145 million user records have been accessed by hackers, the company announced in a statement yesterday. All eBay users have been advised to change their passwords immediately.” — The Week
The breach was detected after noticing several unusual behaviors on the company network. Hackers obtained names, email addresses, birthdates, physical addresses and phone numbers. If your Social Security number was on file back then, hackers would have a free-for-all on the dark web. More details on the breach can be found here. The value in compromising a user’s eBay account has just increased thanks to the SSN requirement.
There is also a wiki page, dedicated to criticisms directly targeting eBay. From bid shilling, to forgeries, counterfeit items, to a one-way feedback system eBay is no stranger to being at the center of controversy. What’s more is the company does not publicize enough, simple measures sellers can do to protect themselves. For example, including the serial number in your listing images or insuring the MPN, part number and other fields match even despite being auto-populated. All these factors come into play when a buyer files a dispute.
The current feedback system considers large and small transactions to be equivalent in terms of rank. This makes it easy to drive up ratings based on low value items. Given the ease of account creation, it is not particularly difficult to purchase your own items to either drive up bids on an item. eBay also reserves the right to change feedback as they deem fit. Users can request to have feedback removed which may or may not be communicated to the original party.
A surprisingly good resource is the eBay Community. There are some excellent posts with great tips and information from other users. Similar topics and debates are open for discussion with users facing similar predicaments.
I found it interesting that within my seller’s dashboard the amount sold for the month, actually included the two ‘canceled’ fraudulent transactions. Does eBay inflate their numbers in terms of total sales even for canceled auctions? What leads me to believe this might be the case is that my monthly invoice included fees for the two canceled auctions. I had to reach out to eBay to reverse the charges.
After doing some digging on Google and reddit, the general consensus was two things:
- eBay always sides with buyers
- Like most VC backed firms, revenue, profit and loss didn’t really matter. It was all about the ‘active’ user base.
This was enlightening to say the least. No wonder eBay had allowed such behavior to commence on their platform. It started to make sense.
Third time’s the charm
Out of sheer frustration, I decided to list my PS5 for a third time. I’m not sure if it was due to the settings having been set prior to the listing or if it was all the complaining I had done. The number of fraudulent bids was drastically lower this time around. I ended up selling my PS5 for a final value of over $900 which included ‘free 2-day shipping’ to a gentlemen with an intent to pay.
I held up my end of the bargain and he held up his. Both parties were satisfied and that is how the majority of transactions should be. It is disappointing when a company as well known as eBay does nothing for smaller users wanting to conduct legitimate business.
Selling less trending items
Fast forward a few months, I was able to get my hands on an Xbox Series X. It is a great console and worth the wait. It is now time to sell my older Xbox One X console as there is no need to keep it. Long story short, I was again taken advantage of by a user who was responsive (at least) but again had zero feedback and zero intention of buying my fully functioning console. I learned my lesson (again) and convinced myself I will only consider selling an item to someone with at least a feedback score of 3.
I haven’t actually sold the old console yet. It’s not due to fraud or buyers with little feedback this time. Instead, it is due to eBay themselves. They now require all sellers go through them directly (instead of PayPal) with a checking account. This is completely fine, I have multiple checking accounts, if eBay wants to deduct fees first and deposit funds directly into that account, so be it. I initially welcomed this as one of the ‘features’ the rep was referring to when they mentioned eBay was hardening their standards.
Seller requirement changes in 2021
It was something else holding me back. Not only do they require a checking account but they want my Social Security number. I suppose this is what they need to do in order to make Uncle Sam happy. That part is fine and makes sense. What I cannot wrap my head around is the thought of sharing my Social Security number with a company that turns a blind eye to fraud and purposefully keeps account creation trivial to inflate their user numbers. In the eyes of the law, they should be considered an accomplice. If they take this stance with legitimate customers, how can I trust them to secure my Social Security number?
Let’s not forget, most companies don’t warn consumers once their’s been a breach till almost months later. A typical account has information such as your name, address, phone number and occasionally your date of birth. Most of this information can be found online for most people for little to no expense. However, your Social Security number should be harder to acquire and for good reason.
With an SSN anyone can open a credit bearing account in your name. This can be damaging to your credit history and could take months or even years to remove. During that time, it could jeopardize large purchases such as a car or house. Not to mention all the sources that would require you to update your Social Security number, it quickly becomes quite the hassle. Not to mention, the time it takes for you to be verified and assigned a new Social Security number by the Social Security administration.
Is it worth applying for an EIN instead? Perhaps, but know that it will require a number of documents to be filed and maintained with the state you reside in. It could also have tax implications. Is it worth the extra effort?
Though I love the concept of online auctions, eBay has lost its way. While it is other users that have malicious intent, eBay is just as guilty by omission in protecting its legitimate users from conducting business. Through the years of changing ownership and selling off PayPal, whoever has taken over is doing an awful job. I’m sure there are some analytics somewhere that indicates eBay has a future, but as far as I am concerned, they do not deserve my business. I have to believe that I am not the only person out there who feels this way and has had a poor selling experience.
My guess is that eBay will wither over the years till the likes of Amazon or another platform puts them out of business. In the meantime, my Social Security number will never be stored on their servers. If it wasn’t for the fact that my eBay account is 9 years old, I would have closed the account already. Do yourself a favor and think twice before handing over your Social Security number to eBay.
My original question still stands, given the undoubtedly ‘questionable’ ethics, security breaches and bias towards buyers, does eBay deserve to know your Social Security number? At the time of writing this article I have not shared mine and lucky for me, I do not have any pending transactions. Any seller who has funds waiting for distribution will not be made till there is a Social Security number on file.
I personally will not be sharing my Social Security number with eBay and will strictly keep my account open for purchases only. The time has come for me to explore alternatives for selling my no longer needed but functional items. If in the future eBay, partners with a reputable firm to house Social Security numbers, then perhaps I will reconsider. Till then, it is my hope that eBay can turn the tide and get their act together to help protect legitimate users on the platform. It is consumers that allows companies like eBay to exist, it is also our prerogative to determine their fate.