Ebay hit by Advertising Frauds

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Ebay, lost millions of dollars ad revenues to the Advertising agents in Australia. According to the leading Australian News papers, eBay is suing Glen Gaunt, Dana Joab and Mahmoud Amarni to recover $1.123 million in lost advertising revenues and $214,000 in commissions paid between 2010 and 2012.

The alleged multiple frauds occurred between 2010 and 2012 and relate to third-party agents selling online advertising on behalf of eBay during the time in which Gaunt was the Australian manager of advertising operations for eBay.

According to the reports published in the Australian Newspaper, eBay is alleging several firms where Joab —Gaunt’s partner and wife—and Amarni were sole directors and shareholders wrongfully profited from on-selling  advertising space on eBay’s website and email newsletters. It is alleged the companies told eBay they had sold the advertising spots for a particular rate but had in fact sold it for a higher price and pocketed the difference.The lawsuit filed by eBay against the employees, however alleges that Vistaprint paid a higher amount to eBay’s agents for advertising than the price that appeared on eBay-issued invoices.

The two firms involved are Digital Hub, of which Joab was the sole director and shareholder, and Digital Media Hub, of which Amarni was the director and shareholder. Also implicated is an advertising firm called Media Minds, founded by Joab, which allegedly facilitated the transactions and another company called Admedia, of which Armani was the sole director and shareholder, and which was allegedly appointed without authority to sell eBay banner ads on Google Ad Exchange.

It typically takes 12 months for most fraudulent behaviour within a company to be uncovered. But in this case the fraud was running for more than 36 months.

It takes a significant amount of time for a company to gather enough evidence to mount legal action against the alleged perpetrators of fraud.