Max Planck Institute for Foreign and International Criminal Law

The Internet leads not only to completely new forms of crime – such as hacking and other attacks against the integrity of computer systems – and to new needs for protection, it also alters traditional offense forms and the risks associated with them. This is especially apparent in the area of online auctions. In 2003, over eleven million users were already registered with eBay Germany. According to a market research study, German consumers spent approximately eleven million euros online in 2004, a quarter of that sum on online auctions. These developments were attended by new forms of fraud.

This dissertation project studies the new offense forms and risks engendered by online auctions and the extent to which these offense forms are covered by existing criminal law. Through the study of empirical data, this project examines general developments in the area of online auctions and identifies the specific criminogenic factors implicated there: in the Internet, offenders can act anonymously and globally; online auctions are a part of a new growth market that is characterized by buyers making advance payments; the pool of potential victims in the Internet is large; victims tend to be greedy and inexperienced, and they are easily seduced by the playful nature of online auctions. Additionally, offenders employ strategies to mask their identities and intentionally exploit the time factor. As a result, new prosecutorial challenges arise on the national as well as the international level.

Offense forms can be divided into those committed by sellers and those committed by buyers. As far as modus operandi are concerned, the following schemes dominate: sales of pictures and packaging (that is, the buyer does not notice that he or she is entering into a contract for the purchase of a picture of an item or for packaging materials); deception regarding the identity of the contractual partner (especially through identity theft and account takeovers); shill bidding; non-delivery of goods; fee-stacking; deception regarding willingness to pay; bid shielding by the buyer (that is, the buyer enters both a low bid and a very high bid, thus discouraging others from bidding; the buyer then withdraws the high bid just before the auction is over and acquires the product at the low bid), as well as triangulation. The spectrum of modi operandi covers the use of highly technical methods and know-how as well as the simplest deceptive maneuvers that are not successful on account of their sophistication, but rather succeed solely because of the large numbers of addressees in the Internet – a group that invariably includes numerous naive and careless persons, all of whom are potential victims. Thus, the transformation of traditional auctions to online auctions provides a prototypical illustration of the changes classic offense forms undergo under the auspices of the global network.

Existing criminal law does not always provide sufficient coverage for online offenses; indeed, the existing fraud provision is particularly challenged by these new offense forms. In many cases, the charge of fraud is not justified. The results of the study do not, however, reveal any Internet-specific gaps in criminalization that need to be addressed by means of statutory reform. Measures taken by auction houses to prevent fraud have proved useful; the most effective preventive measures, however, are in the hands of the victims.

This project is a dissertation that was begun at the Ludwig Maximilian University of Munich in 2003 and was further supervised by Prof. Sieber at the Max Planck Institute in Freiburg following his transfer there. The project was finished in 2007. See Andreas Dingler, Betrug bei Online-Auktionen, 2008.