EBay policy banning properly marked items irresponsible

Published : 02/01/12
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EBay’s new policy, effective Feb. 20, banning the sale on eBay.com of all replica coins — including those that conform to U.S. law with the word COPY properly incused — is a case of corporate rule-making run amuck and a prime example of throwing the baby out with the bathwater.

For the past four years the numismatic community, as individuals and through organizations, has explicitly detailed to countless eBay officials how Chinese counterfeiters fraudulently sell their wares using the online auction site. The usual method involves listing an item under Replica and showing coins with the word COPY digitally placed on the image. But rarely do the items ever have COPY stamped on them (unless the buyer specifically requests it). Thus counterfeit coins have been flowing into the U.S. marketplace and making their way to local venues where unsuspecting and unknowing buyers become victims of fraud.

Now, after millions of counterfeit U.S., world and other historic coins have been sold into the U.S. marketplace and Chinese “entrepreneurs” have used eBay to identify and develop “partnerships” with “distributors” in the United States using the giant online auction site and its subsidiary PayPal, corporative executives have suddenly gotten religion with a knee-jerk policy of banning all sales. And violators of the new policy, they say, risk having their eBay selling privileges suspended.

Johnna Hoff, eBay’s media spokesperson, on Jan. 18 in an exclusive interview with Coin World rationalized the new policy by explaining, “Because of the nature of our marketplace — specifically that we don’t control the inventory — we’re not able to confirm before purchase that a coin is truly stamped.”

EBay doesn’t have to control inventory to properly investigate complaints or become proactive in consumer protection. For example, why doesn’t eBay have staff available to “blind order” from sellers reported as abusers and lawbreakers? It’s not that difficult to purchase from a seller to verify that what is being sold is what is listed and that it conforms to U.S. law, namely the Hobby Protection Act.

There are a number of responsible manufacturers of replica political items, coins and other numismatic items that comply with U.S. laws. Why should legally produced and marketed items be banned on eBay? There are many legitimate uses of properly marked replicas, primarily educational. For example, legitimate high-quality copies of rare and key-date items give those who cannot afford the real items in high grades a good idea of what genuine items would look like. There is nothing sinister, confusing or illegal about properly marked replica items.

As one collector shared recently: “The crooks will go on selling counterfeits no matter what the new rule says. A better way is to increase the identification of and removal of auctions that contain counterfeits and unmarked replicas.”

It’s important to step back and ask why, after years and years of complaints, has eBay finally decided to take action, albeit not the best possible course in the minds of many, especially longtime users.

The answer no doubt lies in the fact that both the Obama administration and members of Congress are eying possible regulation of commerce on the Internet due to the volume of counterfeit goods being sold there and its impact on the U.S. economy. U.S. manufacturers of hundreds of products — from designer purses to software and from music to clothing — are lobbying for laws to combat the flow of Chinese counterfeits being sold in the United States.

EBay can’t afford another episode like it experienced in 2009 when the Royal Canadian Mounted Police stepped in to inform eBay officials that Canada’s laws ban the importation, sale or possession of counterfeit coins and paper money. Canada does not have a Hobby Protection Act. Canadian law is simple and easy to understand. Only the Royal Canadian Mint can legally mint Canadian coins. So a “replica” of a Canadian coin is automatically a counterfeit. Upon threat of the eBay.ca website being shut down, eBay pulled all replica listings.

When eBay’s bottom line is threatened, eBay listens. But it needs to listen more carefully and put in place a better policy. ■

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