Finding eBay fraudsters through social networks

The red oval on the right represents a known eBay fraudster. How can we use that information to locate others? Follow the interactions. Fraudulent eBay users typically build up their online "reputation" by conducting transactions with accomplices who give them phony "positive" feedback. These accomplices, a research team at Carnegie Mellon has found, typically interact with many fraudsters. If an eBay user transacts with many known accomplices, who aren't themselves engaging in fraud but have given positive feedback to fraudsters, then they may be a fraudster themselves. Thus, the two "clean" accounts at the top of the diagram above are also likely to be scammers.

Perpetrators of these frauds have distinctive online behaviors that cause them to be readily purged from an online auction site, said Computer Science Professor Christos Faloutsos. The software developed by his research team -- Network Detection via Propagation of Beliefs, or NetProbe -- could prevent future frauds by identifying their accomplices, who can lurk on a site indefinitely and enable new generations of fraudsters.

In a test analysis of about one million transactions between almost 66,000 eBay users, NetProbe correctly detected 10 previously identified perpetrators, as well as more than a dozen probable fraudsters and several dozen apparent accomplices.

"To the best of our knowledge, this is the first work that uses a systematic approach to analyze and detect electronic auction frauds," said Faloutsos, who noted that NetProbe could eventually be useful for both law enforcement and security personnel of online sites.

I had never bought anything on eBay until a few years ago when we needed to buy Nora a used bassoon. Local music dealers told us that they no longer carried bassoons because there is so little demand for them; short of spending $5,000-plus on a new instrument, eBay was our only option. Naturally, I was petrified at the thought of being taken in by a scam on such a valuable item. As more and more items are traded exclusively on eBay, the potential for abusing non-savvy users becomes even greater, and tools like NetProbe will be essential.

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