Filed under: Entrepreneurship, Ripoffs and Scams, Shopping, Technology, Fraud

We should be used to this by now. Yet another money grubbing directive has surfaced from mom eBay Inc. (NASDAQ: EBAY), As covered in a story in The New York Times, eBay has decided to test market the strategy of allowing payment for transactions on its site solely through its wanton money portal, PayPal. The company intends to run this test on Australian eBayers. I wonder if our mates Down Under would be willing to tell us how they feel about this strategy?

eBay is claiming that this change in operating procedure will lower the incidences of fraud on the site. That’s funny coming from them, when you consider that the worst eBay fraud nightmares generally run through its own PayPal system. I have the ability to believe that eBay’s own fraud exposure might be cut by funneling everything through PayPal, but that’s about eBay’s bottom line. It’s not about the bottom lines of its loyal patrons. The matter is further analyzed in this Associated Press article.

BloggingStocks reports that, as it stands right now, PayPal collects 2.9% from each sale which runs through its system in the U.S., plus another .30 cents for any sale under $3,000. The picture gets even gloomier for Australian eBayers, where PayPal charges 4.4% on sales, plus the additional .30 cents. What percentage of eBay Australia’s sales currently run through alternate payment means? That’s what I want to know.

If this change is enacted by eBay against the entirety of it’s operations, it will be just one more step in the inevitable creation of “Wal-Bay”, a site where big volumes of foreign made junk will be peddled by a thin crust of well protected sellers. In the meantime, alternate online selling strategies continue to take hold and grow as eBay’s own growth has stalled. eBay can fake revenue growth for just so long. It’s only a matter of time before things really begin to get ugly over there.

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Filed under: Forecasts, Conventions and conferences, Economic data, Headline news, Federal Reserve, Recession

Federal Reserve Chairman Ben Bernanke addressed the Federal Reserve Bank of Atlanta Financial Markets Conference in Sea Island, Georgia this morning via satellite. He discussed in detail the current provision of liquidity by the Fed.

He discussed the shift in Fed monetary policy from its primary reliance on open market operations to lending tools used to address the credit crisis more directly. He mentioned the increased use of the Term Auction Facility (TAF) by commercial banks” from $20 billion at the inception of the program to $75 billion in auctions this month” and indicated that the Fed is willing to increase the use of these auctions as necessary.

He also discussed the extension of Fed credit to primary dealers through the Term Securities Lending Facility (TSLF) and the Primary Dealer Credit Facility (PDCF). He mentioned that extending credit to primary dealers was an breathtaking move driven by the potential for a scenario “in which a cascade of failures and liquidations sharply depresses asset prices, with adverse financial and economic implications.” He indicated that even though improvements in the credit markets have occurred, there are still substantial problems that remain.

He addressed the issue of moral hazard by saying that although additional regulations should be implemented, the Fed must still take measures to resolve the current crisis. In essence, Chairman Bernanke was saying that the Fed will maintain a loose monetary policy until the crisis is resolved.

I believe that the current credit problems will take some time to resolve. Therefore, monetary policy will remain loose for much longer than many are expecting.

Thus, the current environment of real interest rates (interest rates adjusted for inflation) being negative will continue. This favors small-cap stocks. The odds of a small-cap rally increase as we spend more time in this environment and fear abates.

Doug Roberts is the Founder and Chief Investment Strategist for ChannelCapitalResearch.com, and is the author of Follow the Fed(R) to Investment Success: The Effortless Strategy for Beating Wall Street.

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Filed under: Ripoffs and Scams, Technology

Last month I shared my quest to save money by reviewing our cell phone bill. I found that we could get unlimited texting on all of our lines without any increase in our monthly rate. This was a huge deal since my sister was as familiar with text overages as the Cookie Monster is with cookies! Due to the amount of texts already sent I decided to do something I should have avoided, I switched plans mid billing cycle. Most places this wouldn’t be a big deal, but Verizon’s billing system is arranged to maximize confusion for users and profit for the company.

Since the switch occurred mid month Verizon pro-rated the text message plan on my sister’s phone. Normally this means I get some money refunded and it only appears that I was ripped off on the bill. This time however was different. Even though the plan she was on was for 1,500 text messages and we switched to an unlimited plan Verizon decided that the allotment of messages at the time we switched was 913, which just occurred to be 403 below what she had already sent resulting in a huge overage.Verizon’s unique billing method of refunding $6 only to charge $40 for text message overages is ridiculous! I ended up getting the money refunded after a 20 minute phone call Saturday night. Thankfully the customer service rep I spoke to was kind enough to “pull some strings” and reverse the charge although the billing system was supposedly in the right. Lessons learned from this adventure include, don’t switch your cell phone plan mid month and if Verizon ever screws up your bill restitution is only a phone call away.

Do you have any cell phone billing horror stories? How much do you need to be over-billed to call up and demand money back?

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Filed under: Home, Insurance, Ripoffs and Scams

News reports state that as the number of mortgage foreclosures increases, so do the number of “suspicious” fires. When the fire occurs mere days before a homeowner will be forced to leave their home due to foreclosure, it obviously creates suspicion.

Some homeowners do it to get revenge on the mortgage company or bank. Others do it thinking that they will collect insurance money that can be used to prevent the foreclosure. Check out this video on setting houses on fire, especially in areas with higher rates of foreclosure.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Bookkeeping, and is the author of Essentials of Corporate Fraud.

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Filed under: Ripoffs and Scams, Travel

The Associated Press lead tells you pretty much everything you need to know:

A New York City man is suing JetBlue Airways Corp. for more than $2 million because he states a pilot made him give up his seat to a flight attendant and sit on the toilet for more than three hours on a flight from California.

Manhattanite Gokhan Mutlu is suing the budget airline after the pilot told him to vacate his seat and “go hang out in the bathroom” for 90 minutes because the flight attendant had complained that her seat was uncomfortable, according to court papers. When the plane hit turbulence and the pilot directed passengers to return to their seats, “the plaintiff had no seat to return to, sitting on a toilet stool with no seat belts,” according to his suit. That could’ve gotten messy!

This was one of those stories that’s so ridiculous I can’t think of anything to say. Perhaps JetBlue, which prides itself on its no-frills service with low prices, should begin offering discounted fares for passengers willing to sit on the toilet.

If the allegations outlined in the lawsuit are even remotely accurate, some people at JetBlue definitely need to lose their jobs.

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