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Default man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

https://www.philly.com/business/ebay...-20190211.html
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Quote:
In letters to the court, family members described Broudy as a young man who struggled academically in college and associated himself with an “online community” that took him down a bad path.
So I wonder what his username is on here..

EDIT: He sold 3k items between multiple accounts. I wonder how long before the IRS starts chasing him for their cut of his profits, lmao.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Article content reached for month - guess I will wait to read...or subscribe hmm #dilemma
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Best item is the Star Trek sushi set - Off to eBay I go to find one of them!
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

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Originally Posted by rsot View Post
Article content reached for month - guess I will wait to read...or subscribe hmm #dilemma
Here ya go bud.

Quote:
Chad Broudy found an online gold mine in October 2016 when he discovered a glitch on eBay that let him buy anything he wanted, virtually free.


Broudy, a 24-year-old from Coatesville, figured out how to over-redeem eBay’s gift cards again and again without the cards getting charged. For 2½ months, Broudy went on an epic shopping spree, paying virtually nothing for more than 3,000 items valued at roughly $320,000, according to federal prosecutors.


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Broudy bought Macs, iPhones, speakers, small gold bars, and even cash ($100 bills), court records show. He obtained a cotton candy maker, a cordless vacuum cleaner, a brass eagle statue, and a Star Trek sushi set. He sold much of his bounty, converting Xbox controllers, wine glasses, and smart thermostats into cash.


But exploiting that glitch could put Broudy behind bars. He pleaded guilty to two counts of wire fraud in June and faces up to 40 years in prison, court records show. Prosecutors recommend imprisonment within the range of 27 to 33 months plus restitution and a $3,000 fine, while Broudy’s attorney has asked a judge to let him serve up to half of his sentence outside prison. A sentencing hearing is scheduled for May.




Broudy, who does volunteer IT work for a nursing home, said he could not comment on the case without his lawyer. His attorney, Philadelphia-based lawyer Andrew David Montroy, did not return requests for comment.


In letters to the court, family members described Broudy as a young man who struggled academically in college and associated himself with an “online community” that took him down a bad path. But they said he turned his life around, graduated from Penn State Abington with good grades, and stopped defrauding eBay months before federal agents knocked on his door. Broudy has complete remorse for his actions, his family wrote in pleading for leniency.



LinkedIn profile picture LinkedIn profile picture of Chad Broudy, who pleaded guilty to wire fraud after exploiting a glitch on eBay that allowed him to over redeem his gift cards.




“He had no idea he was being investigated or watched, and stopped what he was doing on his own because he realized he was hurting others and found a better place in life to be a part of,” Loretta Broudy, Chad’s mother, wrote in a letter. “Chad has totally turned himself around and is a benefit to the community.”


Prosecutors say Chad Broudy only stopped his scheme once eBay patched the software error that he exploited.




“The defendant had a choice. He could have reported the glitch," U.S. Attorney William McSwain said in a statement in June, when Broudy was charged. "But he chose greed and crime over honesty. He took full advantage of the glitch and exploited it not once or twice, but more than 1,100 times, obtaining more than 3,000 items through fraud.”


The eBay glitch would fail to deduct monetary value from a gift card when a product was purchased with both the gift card and another payment method, prosecutors said. When buying items, Broudy would put nearly all of the product’s cost on the gift card, which would not get charged, and only a nominal amount on the other payment method, prosecutors said. That allowed him to buy items at virtually no cost.


The software bug existed from fall 2016 to January 2017, court records show. One other person discovered and took advantage of the glitch, but spent far less than Broudy, according to eBay, an e-commerce platform that lets customers buy or bid on products from merchants and other consumers. The company expects to be awarded full restitution from Broudy and has recovered $843 so far by charging his gift cards that had remaining balances.


“We have zero tolerance for criminal activity on our marketplace, and we’re pleased that this individual has been brought to justice," eBay spokesperson Ryan Moore said in a statement.




E-commerce fraud jumped 35 percent in 2018 among online retailers that made $10 million or more in sales, according to a survey of 200 companies by LexisNexis Risk Solutions. From mid-2016 to mid-2017, 5,000 companies across eight industries lost $57.8 billion because of e-commerce fraud, according to a report by PYMNTS, which covers payments and commerce news, and Signifyd, a fraud protection firm.


For mid- to large-size e-commerce merchants, each dollar of fraud results in $3.20 in losses, LexisNexis Risk Solutions found. These additional costs can include chargeback fees, merchandise replacements, and labor or investigation expenses


“It’s not just the $320,000” that was lost by eBay, said Kimberly Sutherland, senior director of fraud and identity management at LexisNexis Risk Solutions. “You could multiply that by 3.2 and that might be a better explanation of what that impact was, and why this particular merchant wanted to go after the fraudster.”


E-commerce frauds typically involve bad actors taking over consumer accounts, often using the personal information obtained in major data breaches, cyber security experts said. Hackers have also implanted credit card information-stealing software on e-commerce sites. And customers have defrauded companies by ordering online with credit cards, then canceling the charges, even though they received the goods or services.




Exploiting an existing glitch like Broudy appears to be less common, but there are cases. In January, a homeless man in Britain discovered a glitch on his debit card when he reportedly spent 68 British pounds at a store even though he didn’t have a penny to his name. He went on a 60,000-pound spending spree and was sent to jail for two years.


Broudy used four different eBay accounts and 113 gift cards to make 1,100 transactions exploiting the software glitch, according to court records. None of the eBay accounts was registered to Broudy’s complete name, but they included his last name and home address, and Broudy conducted the scheme using a computer at his Coatesville home, prosecutors said.


“Things would come in the mail frequently, but Chad said not to worry about it and that it was all purchased legally, and that he had money saved up from previous jobs he worked,” wrote Jeffrey Broudy, Chad’s older brother. “Nobody thought anything of it.”


Broudy resold items on eBay, the social media site Reddit, and Swappa, a technology e-commerce company, prosecutors said. But the feds don’t know how many products he resold. Although authorities said he purchased 3,000 items, they said he did not have nearly that many when the FBI searched his home.



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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Thanks phaz
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

So, what exactly is the crime?

"What are ya in for?"
... "exploiting a glitch"
........
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Quote:
Originally Posted by ebaystealth1974 View Post
So, what exactly is the crime?

"What are ya in for?"
... "exploiting a glitch"
........
I was thinking the same thing as I read the article. It's not his fault ebay wasn't debiting their own gift cards when using multiple payment methods at checkout.

Now he's being forced to pay restitution for eBay's error, and the courts are saying he should have done the "right thing" and reported the glitch to eBay. Does eBay have a bug bounty now we should know about? Why would it be this kid's responsibility to report a glitch? And why he is being charged criminally for not doing so?

I agree with you ebs, it's a bit of an unfair case. But he's having the book thrown at him regardless.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Criminal intent + fraud :/
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Does this even fall in the fraud category? He wasn't even using proper stealth accounts. He was paying with his own debit card + a gift card and eBay was forgetting to charge their gift card, from what I understand.

If abusing the systems eBay has in place is "criminal intent" then we're all just as likely to be charged as he was.

I'm sure he violated some tax laws but other than that.. what did he do to break a law?
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

I agree - I see the fraud involved because he knowingly exploited a flaw but...the flaw lies on eb's side...there is no onus on him to report it...but USA is tough like that - corporate influence.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

A good lawyer should be able to get him out of all this.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

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A good lawyer should be able to get him out of all this.
Better Call Saul.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Love that guy!
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Old news story about a bum that got off scot-free when an ATM dumped out about 100k in cash and he rolled it all out in a grocery cart (lol).

Because he didn't intend for it to happen he wasn't guilty.

If he were a kid who didnt know any better he'd be in okay shape.

But as adults we have to plead insanity or an extremely convincing ignorance case.

"I'm so sorry offifficisor, I thought all gift cards had 320k." -_-
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

sloppy....
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

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sloppy....
How so? What would you have done differently? He would have been destined for failure regardless, I think.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

atleast have the sense of anonymity......open a mailbox under a different name......

sell on craigslist....burner phone list up on burner email.....in cash......no paper trails..... meet near areas with no cameras.

use public wifi.....VPN+socks5......proxy chain..VMWARE...separate throwaway laptop.....


hat and sunglasses in the mailbox place.....

Last edited by H4ck; 4 Days Ago at 04:21 PM.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

that sounds like an excellent idea everybody........I quote from news article....


"Broudy used four different eBay accounts and 113 gift cards to make 1,100 transactions exploiting the software glitch, according to court records. None of the eBay accounts was registered to Broudy’s complete name, but they included his last name and home address, and Broudy conducted the scheme using a computer at his Coatesville home, prosecutors said."


yes lets buy some stolen goods in the amount of $320k and have it sent directly to my house.......and use my home ip address with no VPN....nobody will suspect anything.

Last edited by H4ck; 4 Days Ago at 04:35 PM.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

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How so? What would you have done differently? He would have been destined for failure regardless, I think.
nope.....if you look at traderoute, agora and evo....none of the law enforcement in the world caught the admins......

didn't hear of arrests in equifax breach.......

Last edited by H4ck; 4 Days Ago at 04:29 PM.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

Ebay wants to save face for how stupid they were in not maintaining their own systems.
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Default Re: man used a gift card glitch to defraud eBay of $320K. Here’s what he bought.

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Originally Posted by H4ck View Post
atleast have the sense of anonymity......open a mailbox under a different name......

sell on craigslist....burner phone list up on burner email.....in cash......no paper trails..... meet near areas with no cameras.

use public wifi.....VPN+socks5......proxy chain..VMWARE...separate throwaway laptop.....


hat and sunglasses in the mailbox place.....
A lot of under cover stings for Craigslist better luck with Buzz Market
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