This week I had my first experience with a legitimate eBay Trust & Safety TKO notice for an auction that completed a few hours earlier.  So I did a little research and found surprising little written on the subject (to the point that searching for "TKO" in eBay’s help system finds no documents).  So here’s my $0.02 on the subject.

There are two main types of TKO notices, Fraudulent Scams and Legitimate eBay Actions.

Fraudulent TKO Scams - These are typically phishing ploys and they use the eBay TKO phrase to give the email a bogus air of being official (and hope to confuse you by using terms you don’t know).  Most of these encourage you to login to eBay (using a provided link) to address the situation.  The best way to respond to any and all TKO notices is to type www.eBay.com into your browser and check the "My Messages" section of your my eBay page.

Legitimate eBay TKO Actions - This is where eBay has identified somebody using an account that isn’t their own and the TKO action is an attempt to set things straight.  Sometimes eBay’s automated systems finds the inappropriate activity (like a bunch of $900 purchases in about 10 minutes) and other times it is the eBay member reporting the problem that initiates activity (they’re getting emails about winning auctions they didn’t bid on).

eBay’s response to an account takeover report is to assume that all activity by the violated User ID  has tainted those sales (or pending sales) and they completely remove the item(s) from the site.  They follow this by sending out the notices to sellers, and all bidders.  Here are some of the intended and unintended consequences:

1. Confused former buyers - If the ended item was a Store Inventory item (or even a multiple unit Fixed Price item), then buyers who completed a successful transaction weeks or months ago will be told the transaction is null and void and they have no obligation to complete the transaction. 
2. Inability to find a relisted item - If a valid transaction was not completed before the TKO removal, the complete removal of the item from the site leaves the buyer without an obvious way to find "that seller" and "that item" again if the seller relists it.
3. Inability for a Seller to quickly relist the item - If the Seller did not originally create the listing with a tool that keeps an off-eBay copy (e.g. TurboLister), the complete removal from the site means you would have to start from scratch if you want to relist the item.
4. Seller loses watchers, bidders, and Second Chance Offers (and vice-versa) - In my case the listing removed by TKO was an auction with 1 winning bidder and 2 under-bidders who received Second Chance Offers from me.  So although there was only 1 invalid party to this transaction, the other two bidders lost out too.
5. Messed up Seller Account Information and My eBay page - Usually when eBay uses the TKO process on a listing, the seller is immediately credited for all listing insertion and listing upgrade fees.  If the auction/listing has ended, there may be Final Value Fees involved and it may take eBay days to determine which FVF charges deserve a credit.  And as this guide was being written in September 2006, eBay did not have a clean process in place for removing the sales totals from your My eBay page!

What can you do to protect yourself?

1. Keep records of all your transactions - This may be as simple as just keeping eBay email you receive for each transaction (including bid notifications).  Or you can go the extra step and use screen-prints or other ways to capture the information (seller/buyer ID, Item description, prices, etc.)
2. Be extra vigilant about unusual activity - If someone comes it and seems to be bidding in a wild and over-aggressive manner, go see if that user is doing the same with other listings (Advanced Search, Items By Bidder).  If so and you are the seller, consider contacting the bidder before the auction ends.  In extreme cases you could add that buyer to your Blocked Bidder List and then cancel all of his/her bids.
3. Note who you send Second Chance Offers to - eBay does not include that information in any emails they send you prior to the user buying the item.  This would normally slow you down from trying to reach an agreement to do an off-eBay deal.  But in the case of a TKO removal, the original listing (and bidding history) and any related Second Chance Offers disappear completely and if you don’t have your own records you cannot find those bidders.
4. Keep Off-eBay Copies of All Listings - Even if you don't use TurboLister to create your listings, you can use it to download existing listings from the site!