Why are iTunes codes selling above face value on eBay?

Finance
#1

Seeing $100 itunes sell for 130% or more. What is the reason?
VAT evasion in Europe by buying using USD and US gmail account?
Selling to chinese buyers?
Something else?

Any have experience with this? Even after the ebay/paypal fees, this seems like an easy way to run up credit card spend if the buyers are legitimate.

#2

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#3

Possibly money laundering of stolen codes and stolen paypal accounts?

4 Likes
#4

Also scam buyers. They pay 110% for the gift card. Receive the card, then claim they didn’t get it and dispute the sale and get a refund from ebay. If its in inexperienced seller who doesn’t know how to defend against that they the seller gets hosed.

2 Likes
#5

Originally, it was for people ex-US to watch US shows.

#6

Also scam buyers. They pay 110% for the gift card. Receive the card, then claim they didn’t get it and dispute the sale and get a refund from ebay. If its in inexperienced seller who doesn’t know how to defend against that they the seller gets hosed.

Doesn’t ebay just favor buyers always? If a scam buyer uses the code and claims item not received, then isn’t seller hosed? Especially since electronic iTunes codes seem to be against eBay terms and conditions. How would a seller protect against this?

#7

Yeah I don’t know how it works exactly…

#8

That’s exactly why I try to avoid Paypal as much as possible. Their rules seem arbitrary and there are so many stories of account shutdown nightmares, frozen funds, etc.

I try to use Apple Pay for electronic p2p payments whenever possible. When that’s not possible, I will regrettably use cash, and if that’s not an option, Paypal-owned Venmo.

#9

I don’t buy or sell gift gards or most electronics on e-bay. Too much fraud and bad buyers/sellers in those categories. Even the travel points gurus have warned for a few years now that they stopped the gift card selling arbitrage on e-bay due to bad actors. It got bad enough I think e-bay starting limiting refunds to protect themselves and that was the turning point, though I may not be up to date on this. YYMV, beware.

I used to buy discounted giftcards through the many buy/sell online stores. After a rash of physical/e-cards that I received with $0 funds after a week into trying to use them and the hassle of trying to get refunds (I finally did) I stopped buying them except for an expected purchase amount for that day. Just not worth the hassle. Many of those older companies no longer exist. The discounts were all good and great for a time though before it became saturated and with too much fraud risk.

#10

Yep. It’s a no-recourse minefield now for sellers.

#11

I just sold around 15k worth of stuff on eBay. My experience selling stuff on eBay is that the listing fees are around 11% of the transaction and Paypal takes around 2.5%.

Digital transactions are very high risk. Some people will only sell digital codes and digital items with a tracking number since many disputes require proof of delivery so now you have to add in shipping costs. The risk of fraud and scamming should be factored in.

So to really sell something you either have to lose money or inflate the price by 20-30%.

#12

That explains the seller side. How to explain the buyers? They can easily buy at face value from official stores.

#13

scammers buying with stolen paypal accounts

#14

I never figured this part out myself but I’ve had some theories.

  1. Ebay can sometimes be used to avoid paying sales tax, although that is becoming less true as they charge tax in many situations
  2. People have ebay gift cards they want to spend
  3. People have ebay cash back awards they want to spend
  4. The buyers don’t know there are cheaper sources. They check ebay as a default since it has good prices on a lot of stuff and just click buy. No price shopping or comparison done.
  5. Ebay may be viewed as an easy place to do fraud
  6. Some countries have laws against buying digital currency\digital merchandise. Perhaps ebay is a way to work around their laws.
#15

Region restrictions. The ones available in Europe don’t work in the US afore.