Taking advantage of ecommerce glitch

There is no way anybody can say what the merchant will do. I would GUESS that he'll just stop doing business with your brother.
 
In this case, does merchant still report this activity as fraud to police for further investigation and charge? I know my brother took advantge of technical glitch and did something morally wrong. But is this considered wire fraud or online fraud?
Please advise

No one can say with any certainty what another human being will do.

One can only control what he or she does.

What your brother did or didn't do is best NOT to be discussed.

The less you know about another's illicit activity is best for you and the other party.

Discussing criminal activity on an open internet forum allows potential prosecutors an excellent opportunity to eavesdrop.
 
Technically there was no loss in Merchant side.

Irrelevant. The offense was committed. If you rob a bank and decide to leave the money at the door on your way out, you're still guilty of bank robbery even though there was no loss to the bank.

does merchant still report this activity as fraud to police for further investigation and charge?

He could. I would report him in a heartbeat just to make your brother sweat even if he ultimately didn't get prosecuted.

is this considered wire fraud or online fraud?

It's theft.

I'm sure the NJ authorities could find something to prosecute your brother with.
 
Based on the circumstances, as described, I don't think there would be any prosecution for this.
 
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