How a bold eBay scam was unraveled

MIAMI — Jonathan Harkness, a liquor-store regulator from Washington state, came to know “Jorge Carlos” in late 2006, when Carlos posted a Surefire flashlight for sale on eBay using a Miami street address.

Harkness bid $90, and after an exchange of e-mails on AOL, sent Carlos a money order. But the address turned out to be a private P.O. box, the high-tech flashlight never arrived, and Harkness realized he had been ripped off.

So in early 2007, he wrote his congressman, laying out his dealings with the mysterious eBay seller from South Florida and the possibility of a bigger scam. Rep. Adam Smith, D-Wash., urged the U.S. Postal Inspection Service to investigate.

Thus began a three-year probe to unmask “Jorge Carlos,” and to figure out how many other victims he might have fleeced around the country.

The payoff: Earlier this month, Nilton Rossoni, 50, a Brazilian businessman with multiple aliases who had lived in Sunny Isles Beach and Fort Lauderdale, was sentenced to 5 ½ years in federal prison for running one of the biggest eBay scams in history.

“If postal inspectors had written it off, then it all would have fizzled,” Harkness told the Miami Herald.

Rossoni was convicted in October of hauling in $717,000 from more than 5,500 eBay buyers, by creating at least 260 auction accounts, and using dozens of e-mail addresses with Yahoo, Google and AOL, as well as nearly 60 private postal boxes.

Rossoni engineered the intricate online retail scheme with the help of his son, Nilton Joel Rossoni, 28, according to an indictment. The younger Rossoni is a former Brazilian race car driver who graduated with a business administration degree from the University of Miami in 2007. He is believed to be on the lam in his native Brazil.

From 2003 to 2008, the father auctioned thousands of products, from horse saddles to rotisserie grills, without delivering anything to the winning bidders. He maintained a legitimate reputation by fabricating positive feedback.

He also insisted that his buyers use cashier’s checks or money orders, not PayPal. The anti-fraud protection services at eBay are designed to help people who only use PayPal online to purchase their merchandise.

The total illegal take from Rossoni’s eBay victims may seem like a drop in the bucket — some $60 billion in goods were sold on eBay last year, according to the San Jose, Calif.-based e-commerce company — but his brazenness was unparalleled.

“Whenever people would complain on eBay, he would continue to put them off and even blame the post office for the delay,” said U.S. Postal Inspector Richard Koss, who led the investigation after the congressman’s letter landed on his desk in Miramar, Fla.

“He would be able to put them off a few weeks and promise a refund, but he’d never pay them. That would allow him to use the phony eBay user ID a little longer.”

Here is how Koss cracked the case:

First he checked out “Jorge Carlos” on the Federal Trade Commission’s consumer complaint Web site. He found hundreds of angry eBay buyers who had sent thousands of dollars to Carlos, complaining that they never received their merchandise. Koss traced the name to dozens of private postal stores in Miami-Dade and Broward counties, which had photos of “Carlos” on record, as required by law.

“I had numerous pictures of him, but I didn’t know who he really was,” Koss recalled. He eventually zeroed in on “Carlos” at a Fort Lauderdale-area UPS mail box site. “I just went there and waited for him. He matched the photos.”

The inspector looked up the license tag on the man’s car, a Kia Rio. It wasn’t registered to Jorge Carlos but to Nilton Rossoni.

Koss, searching the FTC Web site, discovered not only eBay consumer complaints regarding “Jorge Carlos,” but also another likely alias, “Celso Ferreira.” In fact, the fraudster’s aliases accounted for some 1,400 consumer complaints to the FTC, dominating the list, he said.

Victims detailed rip-offs of $300 to $800 for such items as Bowflex machines, generators and metal detectors.

“It looked like a viable case, with ongoing fraud,” Koss said. “It wasn’t a gigantic dollar amount, but it was certainly worth investigating based on the number of consumer complaints.”

As he surfed the Internet for clues, Koss stumbled upon LotusTalk.com and MustangBoards.com. In summer 2007, he found postings by Thomas Alberti of the Chicago area, who summarized his bad eBay encounter with a South Florida man named “Celso Ferreira.”

Alberti, a lawyer who owned a small business supplying parts for sports cars, described how he successfully bid about $129 for a Snap-on torque wrench and sent the seller a cashier’s check, to a Miami street address. But Ferreira never sent the wrench.

Alberti’s online postings generated responses from others who also had had negative eBay experiences with Ferreira.

Alberti, who had been using eBay since the late ’90s without incident, contacted the police and filed an FTC complaint.

“I was kinda mad,” he said. “I gathered every single communication I had with this guy.”

The police did nothing. But Alberti and Koss compared notes.

The postal inspector figured out that Rossoni was using “Celso Ferreira,” “Jorge Carlos” and several other aliases in his eBay scam. Koss, working with federal prosecutor Marc Anton in Fort Lauderdale, also obtained voluminous records of Rossoni’s bank accounts under his alias names, along with e-mail correspondence and eBay statements.

Koss got back in touch with Alberti to fill him in on the investigation last summer, just before Rossoni’s arrest at Miami International Airport in August.

“I was amazed to hear from him again, because I had written it off,” Alberti said. “I was awed by his level of thoroughness. Now I’d like to see if I’m gonna get my money back. I would imagine I’m pretty low on the pecking order.”

A federal court hearing on restitution for victims is pending.