blog Online auction house eBay has reportedly handed over the details of thousands of its Australian sellers, as part of an initiative by the Federal Government’s Human Services Department (which houses welfare agency Centrelink) to target those it suspects of cheating the welfare system. The Australian reports (we recommend you click here for the full — paywalled — article):

“The Human Services Department has confirmed it is conducting a pilot project to ensure welfare recipients operating online trading businesses are correctly declaring their income and assets.”

To be honest, I feel a little uncomfortable about this. Government agencies have a long history of requesting a little … too much information from private sector organisations, and I would like to see eBay being as transparent and up-front as possible about this issue as possible, which it doesn’t seem like it is being just yet. It would be unfair for users who aren’t even involved with the welfare system to have their details handed over, after all. And this is also potentially a privacy breach; people sell some pretty sensitive things on eBay after all … I don’t think I really want the Government to have access to whatever eBay information it wants.

One of the most laudable initiatives in this space is Google’s Transparency Report, which details the numbers of take-down requests it receives from Government every year, and the number which it complies with. I would suggest that eBay Australia could do worse than emulate Google in this regard, and that it would also need to be very careful as to how it discloses this action to its user base.

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1. seven_tech
   Posted 15/06/2012 at 4:43 pm | Permalink | Reply

   I would like to think the Government is only asking eBay for sellers details who ARE on welfare- say via address or telephone number matching. Or that eBay refuses to give all sellers details and ONLY gives the ones the Government confirms are on welfare.

   But as you say, some transparency would be nice.

   Otherwise, I think this is laudable. There are already too many people who try and cheat Welfare.

2. Mathew
   Posted 16/06/2012 at 12:24 am | Permalink | Reply

   > It would be unfair for users who aren’t even involved with the welfare system to have their details handed over, after all.

   What do we define welfare as? Would you consider the family tax benefit as welfare?
   What about those users who aren’t on welfare but are also not paying taxes?

   • seven_tech
     Posted 16/06/2012 at 3:02 am | Permalink | Reply

     I think it would be reasonable to assume “welfare” here (seeing as they’re talking about welfare cheats, most often, but not exclusively, associated with “dole-bludgers”) is those on the Dole. And also, those receiving rent-assistance, possibly, yes as part of the Family Benefit payment.

     While I agree greater transparency is needed, as I’ve already said, this is GOVERNMENT money after all, that all of us as taxpayers contribute too. It is not unreasonable, it is prudent even, that the government keep track on whether those who receive it are eligible AND are using it to reasonable ends, preferably, to get off it, if it’s the Dole, or to further children’s education and upbringing if it’s Family Assistance. These ends should NOT include running an eBay store on the side and not telling the government as such, which would affect the payment.

     Those NOT on welfare, should not be investigated IMO. How they get their money and may or may not be paying tax, if they’re not draining the welfare system, is not AS important as ensuring those ON the welfare system ARE draining it. Besides, I believe the ATO already investigate eBay for those receiving income but not paying tax. I may be wrong.

3. muso1
   Posted 16/06/2012 at 11:32 am | Permalink | Reply

   This would only be relevant to means tested welfare. means testing including whether you earn income, but claim you have no job.
   Personally I’m fine with it. If you have nothing to hide and have done nothing wrong, there is nothing to worry about.
   I’m far more concerned about the personal data web corporations like Google collect on me and are not transparent about.

4. Happy Heyoka
   Posted 16/06/2012 at 3:04 pm | Permalink | Reply

   Ah, ok, so I sell something on eBay and then they send me an envelope full of cashy low denomination bills… riiight.

   Getting a bank account still (since, what 1985-ish) requires the whole 100 points of ID & TFN?

   The last time I had dealings with Centrelink (a decade or so ago) it involved supplying them with all my account details and balances.

   We already have cash transaction reporting laws, have had for a loong time.

   What exactly is it that they think they’re missing? Maybe there’s a good money laundering scheme we can all get in on?

5. Dave Goodenough
   Posted 16/06/2012 at 10:30 pm | Permalink | Reply

   With the Australian Government now able to access members of Ebay and Pay Pal for the supposed excuse of Welfare Cheats
   then so much for security in Ebay and Pay Pal obviously means nothing any more why the use of pass words etc?

   If the Australian Government can now access Sellers records then soon they will be accessing buyers records to to stop Internet spending

   As a member of Ebay and Pay Pal I fear now this precedent has been made with the Australian Government this will open there records all over the world to any Government that asks

   • seven_tech
     Posted 16/06/2012 at 10:38 pm | Permalink | Reply

     To be fair Dave, they don’t have ACCESS to your account. That would be a violation of privacy laws. They only have access to information on the amounts going in and out of accounts and who owns the account. Not what they’re being spent/received on.

     Getting a bit close to conspiracy theory there.

6. GongGav
   Posted 18/06/2012 at 4:08 pm | Permalink | Reply

   One of the biggest problems for most Govt departments is the cash economy. Its VERY hard to prove someone is doing something dodgy, whether its welfare fraud or tax evasion, when there is no paper trail that can be followed. So for many departments, this sort of information is very helpful in closing down cash economy transactions.

   eBay is a key culprit for this, but you can be assured they wont be the last ones that offer up the info. And for most of these online vendors, they will be willing to hand over the info voluntarily, rather than see it legislated.

   What it will come down to will be whether someone is operating in a business like manner, selling items regularly, and looking professional while doing it. This makes their actions a business, which will count towards many aspects of their Govt interactions.

   For those selling the occasional item, its not an issue. Its the ones selling day in day out that will get caught up in the net. And trust me, the data matching skills of these departments are impressive – they will find out if someone is running a business and doing the wrong thing.

   • seven_tech
     Posted 18/06/2012 at 4:18 pm | Permalink | Reply

     +1 GongGav. I know several of my sisters “old aquaintences” (she hung around with a dodgy lot) who were the rough sort, who boast about the “hundreds of dollars a month” they make on eBay selling handmade or imported items. Alot of them are on welfare.

7. Happy Heyoka
   Posted 18/06/2012 at 5:06 pm | Permalink | Reply

   From memory, you can earn up to about $6k a year on the dole without any problems – so that’s $500 a month… “hundreds of dollars a month” is not necessarily dodgey.

   How exactly is eBay (or any other online service) paying out this money? Sure, you can have a Paypal account or something but eventually it needs to be transferred to (through) a real bank account – at which point, they got you already. They won’t send you a cheque AFAIK and they definately won’t send cash.

   Maybe the income is realised exclusively in goods and services, but again, to turn that into cash you’re going to need to go (eventually) to a licensed secondhand dealer or something once you get past a reasonably volume of transactions (unless you have a whole organised gang of smurfs or whatever).

   I don’t doubt there’s dodgey operators and I don’t doubt some of them are earning tens of thousands a year without declaring it – but – it’s not going to be transferred electronically and I fail to see how fishing expeditions like this article suggests can be justified… not to mention that any kind of business turning over more than a grand or two a month is going to be pretty obvious just from having inventory, couriers, etc etc.

   IMHO, serious organised fraud is already well and truly discoverable by existing mechanisms.

   • GongGav
     Posted 19/06/2012 at 9:28 am | Permalink | Reply

     Actually, yes the money will be transferred electronically. PayPal links to a bank account when you set it up, and its a simple matter to move money into that account. But putting money in an account isnt doesnt trigger many flags with Govt departments, unless its a significantly large amount – AUSTRAC collects all $5k+ deposits from memory, and thats about it. Dumping $5k into an account as a oneoff isnt a big deal these days, and its not hard to split amounts up to get under that limit.

     And trust me on this, there are plenty of fraudsters out there using eBay to run a business, and arent declaring to the relevant authorities. Like 15 or so years ago when they started putting TFN’s on bank accounts, this is just a step forwards for data matching, and making sure people arent dodging the system.

     If they earn $5k from an eBay business, what else are they earning that puts them over a limit? What about a month where they have a surge and earn $1000? Its not averaged over 12 months, its dealt with in the period its earnt.

     This isnt a fishing exercise in any way. Its closing down loopholes that have been exploited for years.

     • seven_tech
       Posted 19/06/2012 at 9:35 am | Permalink | Reply

       +1

8. Happy Heyoka
   Posted 19/06/2012 at 11:13 am | Permalink | Reply

   @GongGav/seven_tech sockpuppet:

   AUSTRAC limits are whatever they say they are (ie: AUSTRAC can and does amend them for different kinds of transactions, some limits as low as $1000 – try trading bullion)

   I’m not certain the ATO is allowed to share TFNAccount relations with DHS, but it would make sense. I’m sure if there was evidence enough for a warrant it would happen for sure.

   So the DHS know about _all_ your Australian financial services, you can’t lie to them about that or you’re breached.
   So the DHS know about your balances, you can’t lie to them about that or you’re breached.
   So the DHS can (probably) require a transaction history (or set up a trap) on your accounts.

   If they suspect a crime they can get the police involved and then use a (warrentless) interception order to join the dots between your phones and your online identities… (what was it, 90000 of these in Victoria last year?)

   If they’re not using the tools they have effectively, why give them extra tools?

   The tools they have are absolutely, totally invasive as it stands… and any lack of progress on their part is down to not putting enough thought or effort into using the tools they have.

   • GongGav
     Posted 19/06/2012 at 11:43 am | Permalink | Reply

     Fari enough re: AUSTRAC, I was just pointing out a basic number. Its not important for this discussion anyway, the point is that you can transfer money from paypal to a regular bank account. Even if AUSTRAC tracks it, coming from paypal is a secondary layer that masks the key issue.

     Which is that people are hiding income from various departments. Which is wrong, and illegal. The tools these departments have arent doing the job, particularly with cash transactions, so the next step is to give them more tools. I’m surprised people are actually questioning this, its a logical move forwards.

     As for data matching between department’s, it definitely happens. For the past 20(ish) years, more and more data has been captured by Govt departments, and there is more and more sharing between them to catch out cheats. Tax data with Child Support or Centrelink, bank information across departments, even large purchases (cars, boats, etc) are shared as evidence of lifestyle – is someone is earning peanuts, how can they afford a $50k car?

     And its those cheats that are the targets here. Not someone making a few bucks on the side, but people actively running a business. Even if someone is earning $10k extra, thats not what a department like Centrelink will be targetting. Its the ones earning $50k, or $100k, or whatever figure you decide. Serious cheats that are getting around the system as it is.

     if you dont like that, too bad. Digital data has been given to these departments for decades, this is just another step forwards.

     Years ago there was a story on A Current Affair (Ray Martin was hosting, thats how long ago) that pointed out that there were 220 Govt databases holding personal information – as a side issue the story was about how it wouldnt take much to link all the info together, and have a defacto Australia Card.

     With the digital changes since, how much information do you think they hold now? Its simply how the game has changed. You might think its an invasion of privacy, I dont. I see why they need to do this, and agree with it.

9. JO BLOW
   Posted 19/06/2012 at 11:22 am | Permalink | Reply

   toughen up princess, thet ax office has had all ebay sellers details for years, and they data share with centrelink,.

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