July 7, 2003

Ebay's Law Enforcement Suckupathon Continues

Ebay's Number One Rent-A-Cop Joe Sullivan put police around the country on notice that Ebay won't ask them for anything as inconvenient as a court order when it comes to getting your personal information from the online leviathan. As reported in The Nation's recent article Buyer Beware , Sullivan announced:

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.
Ah, those court orders. So time consuming for all involved. And besides, resisting law-enforcement might risk having law enforcement notice that not only is Ebay dominating the area of online sales, it is also clearly the leader in enabling online fraud. That would not be good. After all, depositions might cut into the time founder Pierre Omidyar spends touting the hapless Sidekick
The Sidekick (Danger hiptop from T-Mobile)This thing is so neat that I've forgotten how neat it is. The color display is really great, much better than I've seen on any other handheld. It's always connected to the network, so AOL instant messages come and go without having to tell the thing to connect. It syncs instantly to a web interface -- too bad it can't sync with my Mac via iSync. Not to mention not syncing with corporate e-mail/organizers.
... while neglecting to mention his own investment in the company that makes Sidekick.
Palo Alto's Danger, the start-up that sells a mobile device that combines e-mail and instant messaging with a phone and other features, said Monday it raised $35 million. Chief executive Hank Nothaft said initial sales through T-Mobile, the carrier that sells Danger's device under the name ``Sidekick,'' have been in the ``tens of thousands'' since the October launch.

The funding will help Danger gain additional carriers, one of which Danger hopes to announce over the next couple of months, he said. The funding came from Softbank Capital Partners, Meritech, Mobius, Redpoint, Diamondhead Ventures and other investors, including eBay founder Pierre Omidyar.

All in all a minor exercise in duplicity, but indicative of the internal hubris at Ebay which is, day by day, taking it closer to the bleak shores of Enron.

Perhaps Ebay is hoping that by playing nice and getting cozy with law enforcement that the Justice Department, from which Sullivan was hired, won't look too closely at Ebay.

Sullivan even offered to conscript eBay's employees in virtual sting operations: "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."
How helpful. If only Ken Lay and Enron had a similar attitude, they might be in business today.

UPDATE: Eugene Volokh has taken me to task for this on The Volkoh Conspiracy and I am, as always, enlightened by him; indeed I'm even feeling somewhat corrected. Still, to my mind, it is more the general attitude behind Ebay than the black letter law concerns me in this instance. Volokh is quite correct in his assertion that we all want to help law enforcement put away the bad guys, but an announced standing policy of turning over any information at any time for any reason (which is how I understand Sullivan's invitiation) strikes me as being just a little too co-operative. If I was a bank with millions of financial records of businesses and individuals at my command (Ebay owns Paypal) wouldn't those people be made just a bit nervous to know that anybody waving a badge can saunter into my bank and see my account?

Then there's the issue of Sullivan volunteering the Ebay/Paypal staff to act as covert agents of law enforcement. Just this week, there's a story on the Nets of bogus Paypal email being sent around to Paypal users in an attempt to winkle some essential information out of them. If things like this are compounded with a general awareness of the willingness of the company to act as agents, it seems to me that the sometimes too-blind trust on which Paypal and Ebay and thousands of other online businesses depend is threatened. It would be one thing for a police agent, in pursuit of some sting, to pass himself off as an Ebay employee. It seems to me to be quite another to have a core of corporate 'volunteers.'

No, the core question here seems to me to be Sullivan's and Ebay's intent. To say that they Ebay stands ready to help the police combat fraud and other crimes online sounds a bit too much like Claude Raines declaring he is "...shocked, shocked to find gambling is going on here." Ebay, as a transaction mechanism, was designed to be highly scalable. It is regretable that as a business it needs to be chummy with law enforcement to scale up the control of online fraud. They might net a shark or a whale from time to time, but holes in the Ebay net let millions of minnows get clean away.

Posted by Vanderleun at July 7, 2003 12:22 PM
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