How do we create safer ecommerce spaces and eradicate stolen goods and fraud? James Rigg, CEO of Trojan Electronics shares his thoughts in the guest post today:
The sale of stolen goods on online marketplaces is becoming an increasingly pressing issue in the UK. Recent figures from the British Independent Retailers Association (Bira) suggest that 60% of shoplifted items from its members are later resold online. This is a particularly important issue given the ongoing expansion of ecommerce and the steady advancements in technology that are reshaping the retail industry.
The issue extends beyond the sale of stolen goods with growing speculation that some sellers may be exploiting ecommerce platforms for illicit activities such as money laundering and VAT fraud. These activities not only damage the reputation of marketplaces but also deter consumer confidence and trust in ecommerce platforms.
On platforms like eBay, counterfeit and stolen goods often appear legitimate to consumers. From the images alone, there’s no way for buyers to tell they’ve been deceived until the items arrive – and by then, the seller has vanished. These fraudulent sellers typically operate for 4-6 weeks before disappearing, only to resurface under a new name.
This alarming trend not only undermines the trust between consumers and ecommerce platforms but also poses significant challenges for legitimate businesses striving to maintain ethical operations. For brands aiming to protect their reputation and build consumer trust, addressing these concerns is no longer optional. Collaboration with marketplaces, retailers and law enforcement is essential to safeguard trust and transparency in ecommerce.
The role of marketplaces in combating fraud
At Trojan Electronics, we collaborate closely with online marketplaces to establish and manage trusted, ethical stores. Our approach focuses on ensuring transparency and compliance, helping brands provide a safe and secure shopping experience for their customers. By working with marketplaces, we aim to tackle the issue of the trading of stolen goods and fraudulent activities head-on.
To avoid fraudulent transactions, we recommend that marketplaces implement stringent measures to identify and eliminate unethical sellers. This includes analysing new and existing seller profiles, reviewing sales history, monitoring postcode locations, and evaluating delivery patterns. A regular audit of a marketplace’s supply chain, product inventory, and sales records can help to identify and address discrepancies. Moreover, marketplaces can invest in advanced technologies such as AI and machine learning to detect suspicious activities and fraudulent listings. For example, marketplaces should look out for sellers who frequently change account details, have a surge in high-value listings or have inconsistent shipping addresses or unusual delivery patterns.
Feedback data and consumer reviews also play a pivotal role in identifying potentially fraudulent activity. If an account has consistently poor feedback data, marketplaces have a duty to investigate. Excellent customer service is a must for marketplaces to successfully combat fraud. This also means responding promptly to customer concerns and resolving disputes fairly and transparently. Consumers might be the first to notice a suspicious seller or listing, so it’s crucial that they are heard and their concerns addressed.
A final consideration for marketplaces should be the payment methods on offer to consumers. We recommend offering a range of secure and trusted payment methods that will protect both the buyers and the sellers. Wherever possible, marketplaces should avoid facilitating off-platform payments, which can bypass fraud protections and raise red flags. Displaying the badges or certifications of the marketplace’s chosen payment platforms can go a long way to reassure customers of a site’s credibility.
How retailers can maintain consumer trust
Whether they are selling direct-to-consumer or via an online marketplace, to maintain consumer trust retailers must ensure that their online stores are legitimate, ethical and transparent. This means responsible sourcing – sellers should request invoices, proof of purchase, or supply chain certifications to guarantee the authenticity of their products. Businesses should also ensure that they provide honest and detailed descriptions of their products, including information about the brand, condition (e.g., new, refurbished), and specifications. Hidden costs such as taxes or shipping fees should be avoided at all costs. Finally, retailers must provide their customers with a clear refund, return, and warranty policy.
Businesses should avoid misleading consumers as this can severely erode trust and harm their reputation. By partnering with an experienced and trusted third-party logistics provider, companies can guarantee the safety of their reputations and the maintenance of their consumer relationships. This proactive approach not only protects brand reputation but also reassures consumers that they are purchasing from a reliable source. Businesses that maintain legitimate and ethical practices can foster long-term loyalty and trust with consumers.
What can consumers look out for?
Identifying stolen or counterfeit goods from product images alone can be challenging, but there are some key signs to help spot illicit sellers.
First of all, consumers should review the seller’s ratings and feedback carefully. Illicit sellers are often new to the platform, with only a few weeks of trading history and limited feedback. They also tend to offer slower delivery times, as they lack the infrastructure for same-day or next-day dispatch.
Secondly, consumers should be on the look out for suspicious account activity. Some sophisticated illicit sellers exploit dormant accounts—reusing old accounts that have been inactive for months or even years. Gaps in feedback history, with a sudden restart after a long period of inactivity, are often red flags. Another indicator is mismatched feedback. For instance, if an account previously sold hair products, then went dormant, and suddenly began selling pet food or cleaning supplies, this could suggest a change in the seller.
By staying vigilant and examining these details, consumers can reduce the risk of falling victim to counterfeit or stolen goods.
Collaborative efforts to create a safer ecommerce landscape
Addressing the issue of stolen goods and fraudulent activities on online marketplaces requires a significant and collaborative effort from consumers, marketplaces, retailers and law enforcement. Consumers are responsible for reporting any suspicious activities or accounts to retailers or marketplaces, while retailers and marketplaces are obligated to take these reports seriously, conduct thorough investigations, and escalate any confirmed incidents to law enforcement authorities.
As the ecommerce landscape continues to evolve and expand, businesses must remain vigilant and proactive in safeguarding their operations. Ethical practices and transparency are key to maintaining consumer trust and protecting the integrity of online marketplaces.
At Trojan Electronics, we are committed to collaborating with marketplaces to establish trusted stores and combat the illegal trade of stolen goods and fraud in ecommerce. By working together, we can create a safer shopping environment and ensure that consumers can shop with confidence in an increasingly complex retail industry.
