Greetings!

Report it to ebay immediately. My guess is that someone who spent a lot of time building a good reputation had his account attacked by someone else, and that the cracker is now using that account fraudulently. Escrow, and all of the other security measures, would be binding against the owner of the account, not the cracker.

eBay has had a lot of trouble with fraud email recently - part of a phishing scheme to get account data.

Report it. It is likely that the original account owner would thank you for it.