If you want to know if an iPhone is stolen, check the Activation Lock setting. This lets you see if this setting has been disabled, and if not then you're going to need the right code to disable and use the phone at all. You cannot erase or do anything else if this is not properly deactivated. Chances are that the phone is stolen if you try to call the seller and they either won't help because they don't know the code or now are avoiding you.
The only thing to do if you know you have a stolen iPhone is to try and contact the owner. Try to find the IMEI or MEID and contact the carrier that the phone is under to see if you can get them to track the owner down for you. The person may also use the lost iPhone settings on their account to track the phone, so don't be surprised if you have authorities visit you to get it back at some point.
You probably won't be able to get your money back from a thief because they probably won't answer calls or emails after the sale. You can try filing a police report, and you can also just try to get the owner their phone back quickly in hopes of getting a reward for being honest. Do not try to sell the phone to someone else or to hold onto it because you don't be able to use it and if someone buys it from you and they can track you down you can get into serious trouble for theft even if you didn't steal it in the first place. It will look like you were the thief if you try to get rid of it and that will cost you more in legal fees than the phone is worth.
1 - http://readwrite.com/2014/10/02/apple-new-activation-lock-status-tool-iphone-ipad-stolen-theft
2 - http://www.imore.com/how-find-owner-lost-or-stolen-iphone