For long, the story of Shawn Hogan has been a popular gossip story among affliate webmasters. Shawn, as some may know, is the founder and CEO of DigitalPoint, one of the most popular webmaster forums on the internet and one who at one point made over $1 million a month referring traffic to eBay. He is currently fighting eBay on 15 counts of FBI charges relating to alleged fraud on the eBay affiliate program. He stands to face a jail sentence of close to 20 years and fine of up to $250,000 per count if convicted.
Shawn Hogan has finally opened up about his legal fight with eBay on his blog and it makes for an interesting read. Of course, take this with a grain of salt since there are always two sides to a story. But there are some great insights in the story Shawn has shared. Here are a few excerpts.
“When I asked them why they would knowingly allow affiliates to violate their terms of service, they were very good at avoiding answering my actual question. Finally after pestering them with the same question for weeks, they broke down and informed me that their terms of service (and even the entire affiliate program to some degree) was a bit of a facade. It allowed eBay to do things they wanted to do (like spam search engines, deploy in countries where they had no actual presence, etc.), while also giving them a way to wash their hands of any wrong-doing when any of their large partners (like Google) would question them about it (like why there are so many spam sites directing people to eBay). They could simply say, “It’s our affiliates, and they are violating the terms of service we set forth.”
“I first heard the name Ben Edelman towards the end of the summer. Apparently eBay contracts with Ben to do random compliance checking on their affiliates and issues a monthly compliance report to them. I showed up on his compliance report because this was the time they gave me the go ahead to play with non-compliant things. eBay then proceeded to amend what they told me prior. I was free to do experiment with whatever I wanted, as long as I didn’t show up on any outside compliance reports. They said outside compliance was something they had to do as a publicly traded company, but wasn’t something they paid much attention to internally.”
“One topic that was discussed was eBay secret “black budget”. This was described as a large allotment of money that eBay was free to do what they wanted with, without it being reported on accounting sheets (and in turn shareholders). eBay wanted me to REALLY ramp up spamming the web with eBay ads. I told them I wasn’t interested at ALL and in fact still wanted to quit the program completely, not “ramp it up”. I explained to them that Google was pretty good to me as far as sending me traffic and that I had no interest in spamming Google search results. Then they offered to buy any hardware I wanted with their black budget and get it co-located offshore if I wanted so that no one could trace the spamming back to me or digitalpoint.com. I still told them I wasn’t interested.”
Check out the complete article on Shawn’s blog at DigitalPoint here. Is the eBay affiliate program evil? You decide.