Definition:
Gray market goods are products that are purchased with stolen credit card numbers or bank account information and then resold to unsuspecting buyers for a profit. The purchase and resale of these products is often associated with identity theft, credit card fraud, and bank account fraud.
Items that are purchased with stolen credit cards or bank funds are often resold in semi-anonymous auctions such as those offered by eBay. There is no way for the auction site to know the goods were purchased by fraudulent means and sellers can change IDs often enough to make it very hard for them to be caught.