I have a good friend who was swindled in this case, along with many others. The buyers had no reason to believe they were being ripped off, as the seller had several thousand feedbacks, at 99%+ postives. Once people paid, and didn't get their merchandise, they started communicating with each other, set up a Yahoo group, and eventually tracked the guy down. Without the internet, they probably never would have found him (although, you can say that without the internet, those people wouldn't have bought anything from him, but that's besides the point :) ).
That's great. The empowerment of the individual is perhaps the greatest achievement of the internet. And that is working out in so many ways.