EBay in Bed with Big Brother
Beware!!!
A REPORT ON Israeli newspaper Ha'Aretz said that
law enforcers need only to call Ebay and they'll be sent every detail of
visitors to its auctioneering web site, tout suite.Reporting on a conference
called Cyber Crime, the newspaper quotes executive Joseph Sullivan as explaining
that visitors fill in the terms and conditions form on Ebay, and the second
he or she clicks "I agree", that means she or he agrees that the firm can
submit all personal data to any law enforcement officer who asks. End users
agree to a contract which in total amounts to over 10,000 words. Ebay will
fax back full names, email addresses, home address, phone number, and the
history of items and all other data that it stores. It has stored every
bit of data since it started in 1995.And Ebay says it routinely receives
something like 200 such requests a month from law enforcement officials.
Ha'Aretz said that Ebay employs six investigators to track suspicious people
and suspicious behaviour. Ebay also owns Paypal and has 20 million files
on its users, but it won't disclose those details without a court order.
Big Brother is watching you - and documenting
eBay, ever anxious to up profits, bends over backward to provide data to
law enforcement officials "I don't know another Web site that has a privacy
policy as flexible as eBay's," says Joseph Sullivan. A little bit later,
Sullivan explains what he means by the term "flexible." Sullivan is director
of the "law enforcement and compliance" department at eBay.com, the largest
retailer in the world.Sullivan was speaking to senior representatives of
numerous law-enforcement agencies in the United States on the occasion
of "Cyber Crime 2003," a conference that was held last week in Connecticut.
His lecture was closed to reporters, and for good reason. Haaretz has obtained
a recording of the lecture, in which Sullivan tells the audience that eBay
is willing to hand over everything it knows about visitors to its Web site
that might be of interest to an investigator. All they have to do is ask.
"There's no need for a court order," Sullivan said, and related how the
company has half a dozen investigators under contract, who scrutinize "suspicious
users" and "suspicious behavior." The spirit of cooperation is a function
of the patriotism that has surged in the wake of September 11. eBay is
the world's largest auction site. Some 62 million registered users buy
and sell a variety of merchandise through the site, which charges commissions
for every item sold. Sullivan claims that 150,000 Internet users earn their
livelihood from the site, some having left their old jobs to become buyers
or sellers on eBay. The sales method on the site is simple: An individual
registers as a user, types in his particulars, and affirms that he accepts
the user conditions and the site's privacy policy. Whenever an item is
sold, the buyer fills out an evaluation form, telling other users about
the treatment he received, whether the merchandise was sent on time, etc.
Other eBay users can then avoid buying from sellers who have received poor
grades. Sullivan says eBay has recorded and documented every iota of data
that has come through the Web site since it first went online in 1995.
Every time someone makes a bid, sells an item, writes about someone else,
even when the company cancels a sale for whatever reason - it documents
all of the pertinent information.One would think that preserving privacy
of the users, whose moves are so meticulously recorded, would be keenly
observed at eBay, whose good name in the Internet community is one of its
prime assets. But in the U.S. of the post 9/11 and pre-Gulf War II era,
helping the "security forces" is considered a supreme act of patriotism.
Who needs a subpoena?
"We don't make you show a subpoena, except in exceptional
cases," Sullivan told his listeners. "When someone uses our site and clicks
on the `I Agree' button, it is as if he agrees to let us submit all of
his data to the legal authorities. Which means that if you are a law-enforcement
officer, all you have to do is send us a fax with a request for information,
and ask about the person behind the seller's identity number, and we will
provide you with his name, address, sales history and other details - all
without having to produce a court order. We want law enforcement people
to spend time on our site," he adds. He says he receives about 200 such
requests a month, most of them unofficial requests in the form of an email
or fax.The meaning is clear. One fax to eBay from a lawman - police investigator,
NSA, FBI or CIA employee, National Park ranger - and eBay sends back the
user's full name, email address, home address, mailing address, home telephone
number, name of company where seller is employed and user nickname. What's
more, eBay will send the history of items he has browsed, feedbacks received,
bids he has made, prices he has paid, and even messages sent in the site's
various discussion groups.Attorney Nimrod Kozlovski, author of "The Computer
and the Legal Process" (in Hebrew), heard the lecture, and could not believe
his ears. "The consent given in the user contract should be seen as `coerced
consent,' in the absence of any opportunity to exercise free choice, with
no real alternative but to agree. This is most certainly not conscious
consent."
Kozlovski is part of the Information Society
Project group at Yale Law School, in which he and his colleagues consider
the effects of the new media on the structure of society. American law
does not authorize searches of a person's home or body, he says, except
in exceptional cases such as when the court authorizes a search, or when
the individual gives his consent to a search."In the case before us, the
Web site signs the user to a document that says it can do whatever it wants
with his information. The eBay contract signed by the user concedes his
or her rights to protection from the government; in essence, as soon as
the contract is signed, eBay can invite the government to do whatever it
wants with the information, he says.A brief visit to the company's Web
site reveals that the "user contract" that visitors are supposed to read
before agreeing to the conditions is 4,023 words long. One paragraph makes
reference to the site's "privacy policy." The user has to click on a link
and is diverted to another document that is some 3,750 words long. It then
takes another 2,390 words to reach the section about which Sullivan told
the legal authorities: The user's privacy is solely up to eBay."The users
are asked to read and agree to the site policy before they can make use
of it," eBay spokesman Kevin Pursglove told Haaretz. "We provide a link
to our privacy policy on every single page of our site, and provide summaries
of this policy, all so that users will be familiar with our policy."We
will work for youNevertheless, eBay does not make do with simply sharing
its data with the legal authorities. Sullivan says the company employs
six investigators, all of whom have experience in police investigations.
Their job is "to track down suspicious people and suspicious behavior."
To that end, they scan for patterns that are atypical - different from
"normal patterns." For example, if a person sold baseball tickets for two
months and suddenly switches to selling a car, the eBay system will "wave
a red flag" and signal the seller as someone behaving unusually. Who asks
eBay to do it? No one. eBay volunteers.eBay goes even further. In his lecture,
Sullivan spoke about how he helped investigators locate a user who had
been suspected of selling stolen cars through the site. "We tried to buy
the car from the thief and in that way incriminate him. But the bad guy
was smart. He saw there wasn't a single feedback in the history of the
person who was making the purchase. He told us he didn't want to make a
deal with us."Sullivan explained that the incident taught the company a
lesson, and that since then it has used pseudo buyers for which it constructs
simulated histories, including simulated feedbacks, all for the sake of
incriminating those suspected of theft. "eBay is not willing to tolerate
acts of fraud carried out on its site," explains Pursglove. "We believe
that one of the ways to fight fraud is to cooperate with the legal authorities
at the various levels.Sullivan is even more forthcoming. Aware of how hard
the police work, he decided to help as much as possible. "Tell us what
you want to ask the bad guys. We'll send them a form, signed by us, and
ask them your questions. We will send their answers directly to your e-mail."
Essentially, by engaging in what seems like impersonation, eBay is exploiting
its relationship with customers to pass on information to law enforcement
authorities. Why? "We take various steps in order to fight fraud and provide
a safe buying environment for our numerous users," says Pursglove.
"In order to prevent misuse of authority, the
law ensures that authorized impersonation will only be used with persons
suspected of carrying out illegal activity," says Pursglove. But eBay's
practice is to impersonate people on a regular basis, for law-enforcement
objectives. However, "there need not be a proven connection or well-founded
suspicion of a crime having been performed," claims Kozlovski.In July 2002,
eBay bought PayPal, Inc. for $1.45 billion. PayPal, which offers the most
popular means of payment on eBay, provides clearing services for the execution
of online transactions. It enables Internet users to open accounts on the
company site, transferring money from their credit card or bank account.
When carrying out a transaction, the seller receives a certificate with
which money can be withdrawn from the buyer's account in cash. The system
obviates the need to reveal personal financial data.When Paypal was acquired,
the company reported 16 million users, as well as 3 million business accounts
and 28,000 new visitors to the site each day. About 60 percent of PayPal's
income derives from commissions received from users buying goods on eBay.
About 70 percent of eBay buyers use PayPal.Two years earlier, eBay bought
Half.com, a site that specializes in sales of CDs and books. Sullivan explained
that these acquisitions help eBay to provide lawmen with a full picture.
"Every book or CD comes with a bar code. So we know who bought what. The
acquisition of PayPal helps us to locate people more precisely. In the
old days, we had to trace IP addresses (unique address given to computers
linked to the Internet), to locate the buyer, but now Paypal supplies us
with the money trail.PayPal has about 20 million customers, which means
that we have 20 millions files on its users," Sullivan proudly relates.
"If you contact me, I will hook you up with the Paypal people. They will
help you get the information you're looking for," he tells his listeners.
"In order to give you details about credit card transactions, I have to
see a court order. I suggest that you get one, if that's what you're looking
for." It isn't certain that visitors to the site are aware of the thick
hints eBay gives the lawmen.
PayPal Collecting Info on YOU!
"By buying PayPal, eBay is merging the information about
the goods trail with the money trail," explains Kozlovski. "Thus, in spite
of the protective mechanisms of the law against disclosure of details on
transactions, eBay is in a position to analyze the full set of data and
`advise' investigators when it might be `worthwhile' for them to ask for
a subpoena to disclose the details of a financial transaction. Essentially,
this bypasses the rules on non-disclosure of details of financial transactions
and the confidentiality of the banker-client relationship."Kozlovski mentions
how special investigator Kenneth Starr issued a court order that ordered
the bookstore where Monica Lewinsky bought her books to report to him the
names of the books she bought. "Then, there was a huge fuss. Now you don't
need a special order - eBay does the work for the investigators."Kozlovski
feels that eBay's practice should be seen as part of a worrisome trend
in the West to curtail protection of individual rights. In communist regimes,
he says, the state would assign watchers to follow every citizen, who would
pass incriminating information on to the authorities. Now the state doesn't
have to do a thing. People come to it of their own free will. This is also
the case for eBay, which exploits its stature in the market to have users
accept contracts that strip them of their privacy. Perhaps the regime is
different, but the outcome is most assuredly the same.
A million new items a day eBay has no operations
in Israel. But in the U.S., Europe and even the Far East, the name eBay
is uttered in the same breath with names like Yahoo, Google and Amazon.
The company created an electronic business arena where sellers offer their
wares and buyers purchase them. eBay's trick is that both the sellers and
the buyers are ordinary citizens. On eBay, you can find people selling
used chewing gum (and there are buyers), torn soccer balls, 18th century
forks, sunflower seeds and luxury cars (in 2002 alone, some 3,000 cars
were sold on the site, at a total of $30 million.)eBay is one of the few
Internet companies that shows huge profits quarter after quarter. The company
completed the fourth quarter of 2002 with revenues of $414 million and
net profits of $87 million. The company had overall income in 2002 of $1.2
billion, and net profits of $250 million. It is traded on Nasdaq at a company
value of $23.4 billion - three times that of Amazon, twice that of Yahoo
and eight times that of the Israeli security behemoth, Checkpoint.At any
given moment, eBay is conducting some 12 million auctions, divided into
about 18,000 different categories. About two million new items are offered
for sale every day, and 62 million registered users scour the site to find
them. These users have given eBay the monopoly on online auctions in America.
Companies such as Yahoo and Amazon tried to get into the auction market,
but were forced to give up. An estimated 150,000 people earn their livelihoods
solely from buying and selling items by Internet. The company maintains
local sites in Britain, Germany, Italy, South Korea, Ireland, Australia,
Spain, Singapore and Sweden.eBay is a monster that churns out money 24
hours a day, 365 days a year - for itself and for its millions of users.
By Yuval Dror