MC042 EBay Reinstates Thousands of Suspended Accounts

22 Apr

EBay Wants You Back (For The Second It Takes You To Pay Them, Anyway)

EBay has been busy the last few days reinstating what appears to be thousands of previously suspended accounts.  Why would eBay allow thousands of users it had previously deemed undesirable back on the site to defraud even more helpless victims?  That isn’t necessarily what eBay has in mind.  Instead, eBay is trying to persuade account holders with long overdue fees to finally pay up.  You see, eBay’s biggest problem isn’t fraud or user dissatisfaction – it’s people refusing to pay their fees.  By sending out emails offering to restore users’ accounts, eBay is promising a potentially clean slate.  It’s basically what they’ve always promised – pay us and we’ll unsuspend you.  In fact, that’s exactly what they say at the end of every email they send trying to collect money, “If this past due balance is the only reason for restricting your account, it will be reopened for bidding and listing when your full payment is received.”  What’s different about this tactic?  They actually state that they have reinstated the account prior to receiving payment.  Of course, once the user logs in, they will see that their account is still suspended.  Here’s what the email says:

MC042 MegWhitman, we’ve reinstated your account

Hello, MegWhitman (

We’re happy to let you know that we’ve reinstated your account. Your account should now be in good standing as long as you don’t have any other suspensions.

Please note that although your account is now active, any listings or bids canceled by your account suspension won’t be reinstated.



How can an account simultaneously be reinstated, in good standing, and still suspended at the same time?  Let’s have a look at what’s really going on here.

EBay Doesn’t Know If You Actually Exist

While certainly not the majority of eBayers, a great number of eBay users use fake names, addresses, phone numbers, and banking information to conduct business.  EBay has a terrible time figuring out who is real and who is fake and tend to suspend as many honest people as they do potential scammers.  In order to increase their chances of weeding out the frauds, eBay has begun using public records to check whether new users are likely to be who they say they are.  Many, if not all, new sellers will receive a “soft suspension” depending on what information they use to register their account.  This comes in the form of the following email:

MC011 MegWhitman: eBay Account Update — Action Needed

We’ve noticed some activity on your account, and we need your help in verifying some information. We’re sorry for this inconvenience, but while we’re working things out with you, you’ll have limited access to your eBay account.

Depending on the situation, some of your listings may have been removed. Also, you may not be able to create new listings for certain items while this is being resolved.

Please look for a follow-up email in eBay messages; it should be arriving soon. That email will contain information on what you need to do next to help us remove the restriction on your account,

We appreciate your help in getting this resolved as quickly as we can.


eBay Customer Support

Before that happens, users may receive a phone call from eBay with a representative that wants to ask verification questions.  If you don’t answer that phone call, you’ll get the following email with the subject: FR0RC002 eBay is trying to contact you and the text:

Hello Meg,

Thank you for selling on eBay. In order to maintain a safe and secure
online marketplace, eBay may require additional verification from
sellers from time to time.  We would like to arrange a call to discuss
activity on your eBay/PayPal account.  Please let us know when you are
available to receive a call from us.

Our office is open from Monday to Friday, from 8 A.M. to 3:30 P.M. MDT

Please respond to this email within 48 hours.

We appreciate your cooperation in verifying your account as quickly as
possible, and we welcome you as a valued member of our trading
community. Thank you for your cooperation.

Kind regards,

eBay Trust & Safety

Once they get you on the phone, eBay will ask you similar questions to the ones Experion would ask if you were trying to retrieve your credit score online.  They’ll ask about past addresses, whether you have a mortgage, and which bank you used to get your mortgage.  They’re odd questions if you’re not expecting them, but if you refuse to answer or question who’s calling, chances are you’ll get the previous MC011 email with the soft suspension.  The answer to these questions is almost always “None of the above” so if you’ve managed to create an account and you don’t know the answers then that’s your safest bet.  Either way, be prepared to answer multiple choice questions about your past addresses and credit history.  If you fail to answer the questions correctly or don’t respond, eBay will send you an email similar to the following:


We would like to inform you that selling limits have been placed on your
account. eBay occasionally places selling limits on accounts to keep the
trading community safe.

We’d be happy to review your account and, if possible, adjust your
selling limits to allow additional activity to take place. In order for
us to review your account, I need to ask you to submit all of the
following information by fax (fax number below):

-A readable copy of the driver’s license, front *and* back, or
other government-issued ID.

-A copy of a recent credit card statement. Your billing address
should be visible, along with the first and last four digits of your
credit card number.

-Documentation that shows that you purchased or are in possession
of the item(s) currently listed for sale on eBay. If you have many items
for sale, we just ask that you send two or three invoices.

-If your ID and credit card statement do not show the address registered
to your eBay account you will need to provide specific documentation,
such as a utility bill or receipt (if address is for a mail forwarding
service) that does.

Important –

-Make sure that your name and User ID appears on each document that you
— After you send this information to us, please reply to this
message with a brief note letting us know that the information has been

Where to Fax:

Attn: Seller Vetting
US number: 1-801-206-7562
International number: 001-801-206-7562

Where to Mail:
Attn: Seller Vetting
PO Box 1469
Draper, UT 84020

This is eBay’s way of figuring out exactly who you are so they can collect money from you should you fail to pay at a future date.  Unfortunately for eBay, the information they ask for can be easily faked, although it does make it more difficult for casual fraudsters to create numerous accounts using fake information.  Luckily for scammers around the world, it doesn’t stop the best, many of whom continue to thrive selling counterfeit items or goods that they have no intention of delivering on eBay.

It’s Hard to Collect Money from Someone That Doesn’t Exist

EBay uses a variety of tactics to try to get users to pay their fees.  Unfortunately, it’s exceedingly difficult to collect from someone/something that doesn’t actually exist.  After a user’s account is past due, eBay will send a few gentle reminders asking nicely for payment with the subject, “eBay Payment Reminder – Action Required USPRE.”  If payment is still not received, you’ll receive an email with the subject “Your eBay Account Has Been Placed On-hold: Action Required US200” explaining the various ways you can pay your fees.  An additional warning is issued in the email: “If we do not receive your payment, your account may be suspended and additional collections remedies may be used to bring this account to current. All current listings will be ended and you will no longer be part of the eBay community.”  You’ll get one of those emails every few days for a month.  Then comes the permanent suspension with the accompanying email: “MC197 EBI NOTICE: eBay Registration Suspension: NonPayment” and the text

Your eBay account has been suspended because you currently owe a balance of US $1 million Dollars.

eBay will gladly consider reinstating your account, but only after this balance has been paid in full. If this past due balance is the only reason for restricting your account, it will be reopened for bidding and listing after your complete payment has been processed.
Please follow these steps to make a one-time payment of :

1. Click the “Site Map” link located at the bottom of most eBay pages.
2. Scroll down until you see the “My Selling Account” section in the middle column.
3. Click the “Make a Single Payment” link. You may need to sign in.
4. To pay using PayPal, enter the payment amount in the box and click the “Pay” button. To choose another payment method, click the appropriate link under the PayPal box and follow the instructions on the next page.

If you don’t have Internet access or have forgotten your password, please mail a check or money order to this address:

eBay Inc.
P.O. Box 2179
Carol Stream, IL 60132-2179
United States

– Important –
- Include a copy of this notice with your payment.
- Make sure to clearly note your User ID on your check or money order.

We need you to take action. For more information about why your account may have been suspended and what steps to take now, please go to:

For more information about eBay payments and account reinstatement, please visit:

– Please note –
You are currently being billed a late payment finance charge that is equal to 1.5 percent of the amount that you currently owe. This fee will be charged each month on your invoice date.

We appreciate your efforts to bring your account up to date as soon as possible.

Thank you,

eBay Global Collections

At this point, eBay will continue to send you an invoice to your email each month asking for payment.  They will also send your bill to I.C. System, a particularly annoying collections agency.  I.C. will call you a few times a day and send you several letters through the mail trying to get you to pay.  They can, and will, go after your credit report as well.  The problem is, they can’t do a thing if you’re not who you say you are.  There are thousands of eBay users actively buying and selling on eBay with nothing more than a disposable cell phone, a Simon Gift Card, and a bank account in someone else’s name.  EBay can’t do anything to figure out who these people actually are, so they have no way to make them pay their fees.  There are really only two reasons to pay eBay fees on a suspended account – to get the collection agency to leave you alone and to save your credit report.  If you can just turn off your disposable cell and don’t have a credit report to worry about then there’s nothing eBay and their collection agency can threaten you with.  Thus, eBay has a serious problem.

Why EBay’s System of Suspensions and PayPal’s Use of Limitations Doesn’t Make Any Sense

I’ve always questioned eBay’s use of suspensions and PayPal’s use of limitations to shut sellers down.  First of all, the funny thing about PayPal limitations is that sellers with a limited account can’t send payments.  This includes sending a payment to eBay to pay fees.  A seller with a permanently limited PayPal account can’t pay eBay fees with PayPal at any time and eBay can’t go into the PayPal account and remove money to pay the fees themselves.  EBay is completely stuck unless the seller pays their fees via another method.  Even after PayPal finally releases the funds to the buyer and allow them to withdraw their money, the PayPal account remains limited and eBay still can’t touch the funds.  You might think that PayPal would wait to limit a buyer’s account until after the seller has paid their eBay fees, but that isn’t how eBay and PayPal operate.  It’s a classic case of the left hand not knowing what the right hand is doing.

EBay has a new problem that is even more potentially dangerous to their bottom line.  By moving dispute resolution from PayPal to eBay, eBay now has more control over sellers and a better idea of how they’re performing.  However, now eBay is forced to refund buyers even when they can’t recoup the cost of the refund from the seller.  With PayPal dispute resolution, PayPal would put the buyer’s payment “on hold” immediately after a buyer opened a dispute.  This guaranteed that PayPal would have control of the seller’s funds to cover the dispute because the seller could not withdraw or spend the held funds.  PayPal was also able to refund buyers using the seller’s funds even when the seller’s account was permanently limited.  EBay can’t do either of those things with disputes in their own resolution center.   EBay then runs into an even more expensive problem.  The eBay resources any particular seller uses (in the form of bandwidth, customer service needs, etc) are low compared to the actual fee amount owed.  A seller might owe eBay $500 in final value and listing fees, but the actual cost to eBay is only a few dollars in bandwich and services, if that.  With buyer refunds, eBay actually has to pay the full amount of the refund to the buyer in cold, hard cash.  Oweing eBay $75 in resolution fees actually costs eBay $75, not a few pennies like with final value fees.  What happens when eBay has to issue full refunds to numerous buyers after they’ve limited the seller’s PayPal account and they don’t have any other way of collecting?  It’s a serious problem for the company and one that is only increasing costs that they will never be able to recoup.

Second, when eBay suspends a user with legitimate contact information they potentially lose track of the seller forever.  A professional seller that’s holding $25,000 worth of merchandise to sell on eBay isn’t just going to give up after an eBay suspension or PayPal limitation.  They’re going to go underground and sign up with family members’ names or use completely fabricated information to register again.  There are dozens of websites and forums dedicated to nothing more than selling people information on how to get back on eBay after a suspension.  It’s big business.  I can guarantee you that nearly everyone who gets suspended on eBay at some point will search on Google, “How do I get back on eBay after a suspension?”  What has eBay really achieved then?  They end up with thousands of people selling on eBay that aren’t really people at all – just made up names, addresses, and phone numbers.  Even worse is the fact that these account holders no longer care about their accounts or who they’re defrauding.  They can just skip from account to account when problems arise or one account gets suspended.  When you’re doing business anonymously on the internet, there is very little to worry about as far as repercussions are concerned, especially if you aren’t doing anything outright illegal.  For eBay, this anonymity makes it almost impossible to collect fees.  There is simply no reason to pay eBay after a suspension or limitation if you aren’t registered with legitimate contact information.  EBay doesn’t get paid because their system of suspending users doesn’t work.

An Alternate Theory

Where were we again?  I recall something about eBay reinstating thousands of suspended accounts over the last few days.  I’ve been talking about this turn of events as though eBay will simply suspend users again after they pay.  This may not actually be the case as several people are reporting that their accounts are left in good standing and they have successfully listed and sold items as though they had never been suspended.  This brings up our next question.

Has EBay Finally Screwed Up So Bad They Need All Those Suspended Users Back?

EBay announced their first quarter earnings for 2010 this afternoon.  While the numbers weren’t bad, the outlook into the future was not particularly stellar.  Investors punished eBay stock by sending it down a staggering 8.48% after hours for a total drop of about 9% on the day.  In terms of money, today’s loss cost eBay and their investors about three billion dollars ($3,000,000,000) in market cap.   Why not try to get previously suspended sellers to pay what they owe and then have them go right back to putting more money in eBay’s pockets?  Is it a coincidence that all these suspended users were reinstated the day before eBay’s announcement that they don’t plan to make as much money as expected?  It certainly looks like eBay is looking for additional revenue streams and they’re apparently willing to reach out to those it previously thought it could shun.

Let’s Conclude Today’s Lecture

What exactly is eBay up to?  It’s hard to tell.  One thing is for certain – they want their money.  If I were a buyer, I would pay special attention to who I’m buying from over the next few weeks.  If a seller has a high feedback score, but no feedback from the past six or twelve months, then I would be wary of purchasing something from them.  Chances are good they’re a previously suspended seller.  Like always, be careful out there.

8 Responses to “MC042 EBay Reinstates Thousands of Suspended Accounts”

  1. Soggy1 22. Apr, 2010 at 2:47 am #

    The answer to most your questions is MS. MEG WHITMAN! The decline of eBay began with Meg Whitman. She just ran & cashed out when the going got tough. Hasn’t anyone questioned why she resigned at the height of her career with eBay. She set eBay up to fail & Donahoe is getting the brunt of it. I say can Donahoe & hold Meg Whitman accountable for her actions. God help California if she gets elected. Earthquakes will be the least of their worries then…

  2. Effy 14. Sep, 2010 at 3:25 pm #

    As a Platinum eBay powerseller, I can tell you only one thing on eBay, they dont care who you are, if you are a great seller or simply a normal buyer, I make every month 40-50k on eBay and a week ago I got a limited account from paypal, the reason was connection to a random account, now as a Powerseller you would think you get some protection from eBay, but as you said in your post, they are going down, ill be happy to hear on alternatives beside amazon to sell on, oh yes, now that I cant accept paypal, ill be happy to hear on alternative for them as well;-)

    Nice blog you have here mate

  3. DONAHO 17. Oct, 2010 at 10:55 pm #

    Ebay and PAYPAL SUCKS! i was a legit seller and they cut me due to risk behavior. Too bad they will go down one day.

  4. Robert 31. Jan, 2011 at 10:56 am #

    Similar story to another commenter here, I was a Power Seller on eBay for several doing about 300 orders a week and sold to someone who had a bad paypal account.
    PayPal limited my account due to my connection with him.
    You would think PayPal would understand with my 300 sales per week, the odds off me selling to someone like that would be greater.

  5. MMMM 13. Mar, 2014 at 9:52 pm #

    Cant wait til they go down. The Indian reps are idiots and untrained, they took down all my listings (I have 100% feedback) because I misspelled Dooney & Bourke (Dooney & Burke).

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