Posted on 01/28/2007 6:38:39 AM PST by COUNTrecount
CUSTOMERS of the internet auction site eBay are being defrauded by unscrupulous dealers who secretly bid up the price of items on sale to boost profits. An investigation by The Sunday Times has indicated that the practice of artificially driving up prices — known as shill bidding — is widespread across the site.
Last week one of the UK’s biggest eBay sellers admitted in a taped conversation with an undercover reporter that he was prepared to use business associates to bid on his goods for him.
Our inquiries found evidence that a number of businesses — ranging from overseas property agencies to car dealerships — have placed bids on their own items using fake identities.
The cases raise questions about whether eBay, the world’s biggest auction site, is doing enough to protect consumers.
Shill bidding is against eBay rules and is illegal under the 2006 Fraud Act. However, the resulting higher prices on the site boost the value of eBay’s share of the sales.
Last November eBay changed its rules to conceal bidders’ identity — making it even more difficult for customers to see whether sellers are bidding on their own lots. Since its launch seven years ago, eBay’s UK website has attracted more than 15m customers. It sells more than 10m items at any given time.
One of the beneficiaries of the boom is Eftis Paraskevaides, a former gynaecologist, from Cambridgeshire. He has become a “Titanium PowerSeller” — one of eBay’s handful of top earners — selling more than £1.4m worth of antiquities a year on the site.
In a conversation with an undercover reporter last week, Paraskevaides claimed shill bidding was commonplace on eBay.
When the reporter asked whether he arranged for associates to bid on his own items, he replied: “Well, if I put something really expensive (up for sale) and I was concerned that it was going for nothing, I would phone a friend of mine, even a client of mine who buys from me, and say: For Christ’s sake, I sell you 100 quids’ worth of items a week . . . just put two grand on it, will you?” The reporter was posing as a seller of valuable antiquities. He inquired whether Paraskevaides could sell them on eBay and guarantee a minimum price.
He replied: “Leave it to me (laughs). Don’t call it shill bidding. Then I won’t be accused of shill bidding. Yes. I mean — I’ve got people.
“I’ve got some of my big clients who buy big items off me, I look after them. So I can get on the phone to America and say: Mr XXXX . . . you’re a multi- millionaire. You buy a hundred grand’s worth off me a year. Do me a favour would you. Just put — yeah. Exactly.”
He claimed eBay would never follow up a complaint against him for shill bidding because he generated about £15,000 a month in commission for the company. “Are they going to ban somebody who’s making them the best part of 15 grand a month? No,” he said.
After being told that he had been talking to an undercover reporter, Paraskevaides denied that he had ever shill bidded on eBay and claimed he was talking about clients who sometimes bid on expensive items if they wished to protect the price.
However The Sunday Times discovered businesses that have been bidding on their own items. One leading dealer from London admitted last week that that he had shill bidded in the past.
A spokesman for eBay said he expected that the company would now launch an investigation into Paraskevaides. Anyone caught shill bidding risks a permanent ban.
The spokesman added: “The change to the way bidder IDs are shown has already resulted in a safer environment for users.”
When I go shopping on eBay, I search that seller out pretty darn good before I bid. That doesn't always work; but it works often enough to give a pretty good selling history.
I think you can learn more about a person selling on eBay than you can shopping at flea markets.
I don't see much of a difference between the two. (fraud potential wise).
You have to be kidding. There is no rule against bidding at the last few minutes or seconds that I am aware of. The interested person who wants something has ample opportunity to put in a maximum bid that will not be overriden by a sniping bid. I got burned a couple of times by sniping but I have nipped that in the bud by waiting until the last 10 or 15 minutes and then putting in my maximum bid. I take the attitude that if the sniper wants it bad enough he's going to pay for it. That's his choice. I'm in control up to my maximum bid. I can also walk away just like a regular auction if the bidding gets out of hand.
Shill bidding is just plain crooked. I'm sorry, but I'm just telling it like it is.
And one other thing to watch out for is fenced goods. I once got burned myself when I found the serial number ground off. I tried through three police departments for them to look into it but they weren't interested. I was finally told to take it back for a refund which I did. So watch out for stolen goods. It's out there. Again, watch the reputation of the seller and read the feedback. A clean seller has not business selling stolen goods. It could happen but how anyone could miss a ground off serial number is a little hard to comprehend. And by the way, I even went so far as to recover the serial number from the bottom of the unit but that still didn't get the police department's attention. They wouldn't even return my phone calls. You're on your own out there.
Ebay is bidding for me. I place a maximum bid -- their system places the actual bid.
eBay -if it ain't broke, we'll fix it until it is.
No. That is scripting you executed by selecting the option. That is not a person acting on your behalf. That is a computer program you entered the field and hit run.
eBay is definitely the Wild West of the internet
you have to be savvy
they blow off any complaints about 2nd chance offers, although lately all the higher priced stuff is anonymous
I'm surprised at all the complaints about shipping cost since these are all listed up front, and are readily visible.
but I've sold thousands of dollars of classic auto parts at prices I probably would not have gotten without a ton of traveling and wasted time at shows/markets
And booth rental difference!
There's the rub, eh? eBay is enjoying the pixelated fairy dust of being exempt from established business common law doctrines, not to mention regulations regarding auction sales because (1) of the internet novelty (that was, but is no longer applicable) and (2) because of it's hugeness.
It *is* an auction and eBay *is* an auctioneer, that's just the plain fact.
I wish that they STAY exempted from the burden of regulation, but not of common law doctrine. To that end they should seek to protect the bidder in the cases of withdrawn bids more than they do.
Complaints such as this article and mine do when heard again and again without a private market correction, do bring on governmental regulation.
Well certainly high shipping costs of heavy merchandise is justified. I once shipped a cultivator to Canada and that didn't come cheap although it was on the buyer's dime. But for a two ounce package to be shipped for $30 is outrageous. Ebay should ban those crooks permanently , even if it is up front. Some items simply can't be justified to be shipped due to the weight, although automobiles can be purchased and delivered as I have done it. It's not cheap but it's possible. But if a person wanted to purchase a weight training system, that is practically a local pick-up item. But most items are shipable at a reasonable cost.
I do not know, nor I expect would you, what exact process eBay uses to implement the bidding agency they provide. Maybe it is scripting, maybe it is a program, maybe it is a whole cohort of pacific rim minimum wage earners at consoles typing away. It doesn't make a difference. The actual bidding is out of my hands and in the hands of my agent -- Ebay.
I can't help myself from adding more. Beware the fuzzy photos and "stock" photos. Any reputable seller should be able to take clearly visible photos that show all the detail that would be necessary to make an informed decision. If the photo is of poor resolution there is a good reason for it. They don't want you to see what you are bidding on. Again, they are just shooting themselves in the foot. If I can't see what I'm buying, or if it is a stock photo, forget it. It isn't worth the risk. I recently purchased a vintage Sunbeam mixer, although I didn't really need it. The photos were of such exquisite quality that I couldn't live without it. I got it although it wasn't cheap but it sits proudly in my kitchen where I can admire it. My wife thought I was a little weird but when I make up my mind I want something I usually get it. But the photos made all the difference in the world.
Those cute very modern legalism distinctions between an "auctioneer" and a "market platform" will not hold if those providing the "market platforms" do not take an abundance of caution to ensure they are not biasing the platform towards promoting fraud.
No, it isn't eBay. They give you scripting that you implement when you set your bidding. You script it when you add your fields and execute it by confirming bid. You are launching a macro.
You are still in control with the option of withdrawing a bid.
A bid on an auction board is an electronic signature. You are signing a contract. You are acting on your behalf.
Now that distinction is not known to me. I've not been down that road yet.
I remember some legislative discussion in at least one state as to this issue maybe two years ago. If you haven't already take that "Rich Dad" author's advice advice and paper over your business -- that auction "market platform" with a corporate entity so if the law turns out to be different then modern impressions all your all isn't at risk.
There's no law that compels one to complete a contracted transaction once fraud is discovered to have been part of it. In fact, prudence and respect for keeping a healthy market both dictate the opposite -- that the transaction be nullified.
Fraud nullifies contracts. No one is disputing that. And there are procedures on eBay for cancelling a transaction.
I sort of wondered if the piece wasn't already broken when it was mailed. Thje seller was so defensive and even down right offensive. It was wrapped once in thin bubble wrap and in a very narrow box. There wasn't anything to cushion it.
Kindest person I have dealt with was an elderly gentleman who I purchased a GwtW lamp from, when he was geting it ready to ship, he knocked it off the table and it broke. He was so sorry and sent repeated aplogies. He also refunded my money right away.
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