Ethics: Should you hold someone unknowingly acting in the commission of a fraud responsible for your losses?

September 19, 2006 2:19 PM

Is it ethical to sue the victim of a phishing scam who agrees to take employment as someone who receives packages and ships them abroad if you have been victimized by the scam itself?

Here's the (unfortunately not hypothetical) situation:

I sold a MacBook Pro at auction on eBay to someone who did a very good job of making it seem as if they were PayPal Address Verified without actually being verified. (They did this by craftily using eBay and not PayPal to provide their shipping address).

It now appears that a foreign scammer used phished paypal accounts to pay for the goods, and were shipping packages to someone they hired to forward packages to another country. In other words, a person unknowingly was receiving goods that were paid for with stolen accounts/credit cards, and forwarding them along to a foreign person. A reasonable person could have seen that this was a scam, but I believe that the person who is the victim here may not have known that it was a scam.

I think a strong case can be made that by accepting what was stolen property, that I could sue this person who accepted the package for the damages caused by accepting the stolen property and forwarding it outside of the country. But whether or not that case wuold be successful is not my question.

My question is, is it ethical for me to hold that person responsible for the damages (the over $2,000 I am out) that have been caused to me, knowing that she is the end of the chain and will be unlikely to be able to recover any damages from her supposed employer, who most likely never paid her anyway? Let's assume that she didn't know (though it could be reasonably expected that she should have known) that she was working for a scam artist, and that she did not profit from the scam in any way.

posted by JakeWalker to human relations (13 comments total)

They have a duty of care towards you. They are supposed to look out for being used in such a situation. I'd call the cops first though.
posted by Ironmouth at 2:21 PM on September 19, 2006

A reasonable person could believe that there was a chance that they were forwarding stolen goods. So they may well be liable if you sue.

On the other hand, there are perfectly valid reasons to hire someone to ship stuff out-of-coutry, especially when it comes to EBay. More often than not, I see things on EBay that I want, but the seller will not ship out of the country. Not even to Canada. I could have the item shipped to my proxy in the US and have that person ship to me. No law has been broken. Nothing has been stolen. But there's really no way for my proxy to know that nothing has been stolen. So if I have provided the above as a cover story to my proxy, then that person would probably not be liable.

And I think you share some blame for falling for the shipping address dodge. As such, even if the proxy is culpable, you might not recover your entire loss.
posted by solid-one-love at 2:32 PM on September 19, 2006

I'd make sure that she WAS a victim before I'd worry about ethics. The craftiness might include some " I didn't know...they haven't even paid me"! role playing.
posted by lobstah at 2:40 PM on September 19, 2006

"were paid for with stolen accounts/credit cards"

Can you contact the credit card company that was used to verify the account? I'm not sure how you go about that, but they may have a procedure for covering losses due to fraud, even when you're not the cardholder.

I think it would be ethical to sue the middleman, but you probably won't get anything. And if they were duped into laying out cash to get this "job", they may be even worse off than you.
posted by saffry at 2:40 PM on September 19, 2006

oops, too much bold
posted by saffry at 2:41 PM on September 19, 2006

Someone is going to end up screwed here.

Option #1 is you, having lost your laptop and the money you are owed. This is bad.

Option #2 is the intermediary, if you are able to recoup your loss via litigation or intervention by appropriate authorities. If the intermediary was complicit, this is good. If the intermediary was duped, this is just as bad as #1. If the intermediary was reckless or negligent -- i.e. only a scammer or total idiot would really believe the forwarding was legit -- this is better than Option #1, although maybe not totally good.

So, from an ethical standpoint, it's better to impose the burden of this loss on the intermediary if she engaged in some form of culpable conduct. If she was wholly innocent, I don't see any reason to prefer having her bear the loss instead of you (or vice-versa), aside from pure self-interest.

If you're uncomfortable saddling the intermediary with the whole burden of making you whole, you could try to split the difference, so that each of you is only screwed to the tune of $1,000 or so. This seems like the fairest outcome if you are both victims.
posted by brain_drain at 2:43 PM on September 19, 2006

P.S. Splitting the difference obviously makes sense only if you have some means to actually get some money from the intermediary, i.e., a viable claim. Otherwise, the question is moot.
posted by brain_drain at 2:47 PM on September 19, 2006

I am struggling to figure out why you would raise the question unless you feel you have concerns regarding any ethical culpability on your part--greed, misinformation, distortion etc. Since I do not sense any of the latter this seems to me to be a question of legality and practicality. It would seem to me that you could even construe an affirmative ethical obligation on your part to bring appropriate action so other people were not defrauded. That does not mean it is practical or prudent to do so. If any of us set up a business to act as an intermediary (agent) between parties we have an ethical and legal obligation to both parties to act with diligence and assume the responsibility for a failure to do so.
posted by rmhsinc at 2:57 PM on September 19, 2006

If she was wholly innocent, I don't see any reason to prefer having her bear the loss instead of you (or vice-versa), aside from pure self-interest.

Add another caveat - even if innocent, there is net (deterence) benefit in the innocent middle-person taking the hit if there is any possibility that the lack of consequences for their actions may fail to ensure they never do such a thing again.
posted by -harlequin- at 3:07 PM on September 19, 2006

rmhsinc -

I agree with you, and hadn't even thought of that aspect until you and a few other people mentioned it to me. It's really an obligation of mine to report the activity to the police, as I have no way of knowing what is really going on here, and receipt of stolen goods may still be going on; my suspicion that it is not is not enough for me to not report it.

Furthermore, I think I have every right to sue to go after my damages, as the act of acting as an agent/intermediary should have demanded investigation on her part, and a reasonable person should have certainly asked questions about receving and forwarding goods.

If her story is totally true, then she has a duty to go after the foreign scammers to recover any damages. That her efforts may be more difficult or impossible probably shouldn't impact me in any way.
posted by JakeWalker at 3:12 PM on September 19, 2006

I'd assume the intermediary has no money to pay you back- you might check if the person has any assets - and by extension, the ability to pay up if legally responsible.
posted by Izzmeister at 4:37 PM on September 19, 2006

Happens all the time. Today I buy a stolen car, tomorrow you get your stolen car back. I lose. To me its a loss, but its a fair system. Buyer always beware. At this point I can go after the guy who sold me the stolen car.
posted by damn dirty ape at 8:45 PM on September 19, 2006

Due to the arcane contracts of eBay and Paypal (the same company, btw) which are set up to protect Paypal and eBay first, Buyer second, and Seller somewhere around 10045th, I suspect you might be out of luck here.

By not shipping to a confirmed Paypal address you lose on that end.

Back in the day I looked into running one of these international package forwarding businesses, but the amount of scamming going on made it not worth it to me. Too bad too, because there is legitimate reasons to have such a service.

I think the ethical thing to do here is to lobby congress to change the rules to make Credit Companies liable for damages when their cards are used fraudulently. The ability to secure these cards is there, but there is no financial incentive for the Credit Card companies to do so. So we have to hit them in the wallet to prevent this sort of fraud in the future.

See www.schneier.com for more on credit card security and why the banks profit from fraud.
posted by IndigoSkye at 9:27 AM on September 21, 2006