This article is quite confusing in the way it explains the fraud technique. Here's my understanding (using a made-up example):
In the UK, a full postcode e.g B40 4XJ (made up) can be shared by more one than home or building. So the homes numbered 1-20 Acacia Avenue all share the same full postcode: B40 4XJ
Janet lives at 7 Acacia Avenue. She sells her iPhone via eBay for £200 to Patrick living elsewhere. She posts a parcel containing the iPhone to Patrick.
Patrick, via eBay, contacts Janet and says the iPhone is faulty and wants a refund.
Through eBay, Patrick generates a return label (shipping label) which lists Janet's address: 7 Acacia Avenue, B40 4XJ. However, Patrick, alters the address on the label to state: 19 Acacia Avenue, B40 4XJ.
He can do this, of course, because the label is generated online, and using some graphics editing program, he can alter the label before he prints it.
Patrick posts an empty box to 19 Acacia Avenue and keeps the iPhone. Patrick now has the iPhone and a refund from eBay for the £200 he paid for the iPhone.
What of the empty parcel posted to 19 Acacia Avenue? Presumably, the parcel isn't signed for when it is delivered? Or is it? If the parcel requires a signature on delivery, surely the resident of 19 Acacia Avenue will immediately notice the parcel is addressed to someone else?
Please do correct the above if it's incorrect.