8 EBay Sellers Admit to Phony Bids

[Bob Smalser]

Don''t think this affects low-end tools....but who knows?



November 7, 2004



8 EBay Sellers Admit to Phony Bids
By THE ASSOCIATED PRESS

Filed at 1:48 p.m. ET

ALBANY, N.Y. (AP) -- Eight eBay sellers were ordered to pay nearly $90,000 in restitution and fines after admitting they bid up products online to inflate the prices.

New York Attorney General Eliot Spitzer said more than 120 people will receive restitution in the settlement of the three cases, which wrapped up last week in state courts.

Spokesman Darren Dopp said the cases stemmed from specific complaints, but the office has not conducted a broad investigation of the online auction industry and doesn't know how widespread the practice of phony bidding is.

One buyer, Brad Clarke, 48, of Peachtree City, Ga., already has received a check for $3,089 after overpaying for a 1999 Jeep Cherokee sport utility vehicle he bought on eBay from a New York seller in 2002.

``I'd always been suspicious because it seems like an easy thing to do, to just keep bidding up,'' Clarke said. ``But I was still just completely shocked and very surprised.''

Three sellers were accused of making 610 bids on 106 of their car auctions under the user name ``Mother's Custom Automotive NY Dealer.'' They are paying more than $28,000 in penalties and restitution, Spitzer said. Their lawyers declined to comment.

In another case, the operator of an art auction house and two former employees were accused of bidding on more than 1,100 of each others' eBay items for more than five years to drive up the prices. Some paintings sold for thousands more than they were worth.

Spitzer said one of the sellers pleaded guilty to a felony charge, the other two to misdemeanors. They were ordered to pay more than $50,000 in restitution and fines.

The other two defendants were accused of making 170 phony bids on their sports memorabilia items. They agreed to pay $10,000 in penalties and restitution.


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[Roy Wall]

I believe that stuff happens all the time............:eek:

I've seen LN planes, say the #4, go for "supposedly" $275 USED.....

Crazy stuff - it's a crock. Buddies bid it up to get the price for their friend OR... they bid it up because it would be selling TOO LOW and they save the day for their friend.....

I didn't fall off the turnip truck yesterday..........

[Bob Smalser]

There's been shilling as long as there's been auctions...

...what I'm interested in is for the community to follow the story to find out how they caught these crooks.

It's illegal....and if you do it at one of our local heavy equipment auctions frequented by my logger neighbors and get caught...it can also be hazardous to the health. The two major family-run auctions here each have up to 30 part-time employees on the scout for exactly that during one of their quarterly auctions.

[James Carmichael]

Not to defend any of these sleezebags, but...If someone pays more than an item is worth on Ebay, they have only themselves to blame. I agree the buyers are due redress and the "shills" and sellers who used them should be punished to the fullest extent of the law, but don't bid $20,000 on a car if it's not worth it or you don't want to pay it.

Ebay could prevent a lot of this by doing away with proxy bidding, but they're not about to as it's way too profitable for them. Ebay, IMO, doesn't take nearly enough responsibility for the behavior of their sellers and should be held accoutable for this.

[Christopher Pine]

Not to defend any of these sleezebags, but...If someone pays more than an item is worth on Ebay, they have only themselves to blame. I agree the buyers are due redress and the "shills" and sellers who used them should be punished to the fullest extent of the law, but don't bid $20,000 on a car if it's not worth it or you don't want to pay it.

Ebay could prevent a lot of this by doing away with proxy bidding, but they're not about to as it's way too profitable for them. Ebay, IMO, doesn't take nearly enough responsibility for the behavior of their sellers and should be held accoutable for this.

Just what I was thinking! I have a friend who says he does not like ebay because he is afraid somone is bidding up the price on him! Well don't bid if it goes higher than you are willing to pay or if it goes higher than it is valued! This is not rocket science! I personlly could care less if there buddies are bidding it up for them I am only going to pay a certain price after that there buddy can buy it!
Chris

[Charles McKinley]

Buyer's responsibility: It is an auction and you control how much you bid.

Seller's responsibility: Accurately describe the item being put up for auction, and actually have it, properly list it so you don't sell it for less than you want to.

Auctioneer's responsibility: Provide a market place for the buyer and seller to meet and limit FRAUD to the best of your ability.

I have bought and sold on ebay and sellers like this hurt the market. I have not had a problem buying on ebay but I research what I'm buying set my price and don't go over it including shipping.

I'm about to put some Besseys on ebay and they will cost $20 a pair to ship not including packaging and getting them to the drop off.which I don't charge for unless I have to buy packaging. I think this is going to put a real pinch on ebay and catalog sales or at least cut into profits.

[Pam Niedermayer]

Not to defend any of these sleezebags, but...If someone pays more than an item is worth on Ebay, they have only themselves to blame. I agree the buyers are due redress and the "shills" and sellers who used them should be punished to the fullest extent of the law, but don't bid $20,000 on a car if it's not worth it or you don't want to pay it.

Ebay could prevent a lot of this by doing away with proxy bidding, but they're not about to as it's way too profitable for them. Ebay, IMO, doesn't take nearly enough responsibility for the behavior of their sellers and should be held accoutable for this.

How about if you enter a snipe bid and the shill and seller guess your top bid and bid you up?

Pam

[James Carmichael]

How about if you enter a snipe bid and the shill and seller guess your top bid and bid you up?

Pam

I think you're right on, Pam, except it wouldn't apply to sniping since there shouldn't be time for anyone to bid you up.

A seller dealing in a lot of the same type of item, such as cars, can see what people bid for a similar items and when they see the same buyer again, it's easy guess as what their max is then have a shill go just under it. This is probably what the car sellers and shills were doing. For that matter, it wouldn't be too difficult for a good hack to setup some listings that install a trojan on your pc so they can see what your max bids are.

That's why I said if Ebay would do away with proxy bidding, there would be no incentive for this kind of stuff. They also need to screen their listings instead of expecting members to do it for them. I've reported the same sellers many times for illegal listings, mostly keyword spamming. I finally gave up and deleted my saved searches.

[Dennis McDonaugh]

[QUOTE=James Carmichael]I think you're right on, Pam, except it wouldn't apply to sniping since there shouldn't be time for anyone to bid you up.

That's my main argument against those who complain about sniping. The sniper has to bid higher than you or he doesn't have enough time to rebid.

[JayStPeter]

I agree that the buyers had to ultimately enter a number that they paid. It's not like someone said "Hey, you win, now pay me $3K more than you bid".

On the other hand, good on ebay for catching these guys and making an example of what happens with shady dealings. I believe this is a widespread practice. I do believe that some people get caught up in "winning" the auction, but there are just too many cases I've seen where the winning bid is just plain stupid. Lie-Nielsen planes were mentioned, and I've seen it especially bad with ebay businesses that sell new audio equipment. FWIW, most of my auctions have gone for what I consider a decent price (for both buyer and seller).

Jay

[John Weber]

Ebay is a great thing, it lets people find items they might have no other way of locating, and it lets people sell stuff at a true value rather then giving it away at a garage sales etc... In the early days there were very few ebay businesses, today many sellers are either full time or part time. Ebay is still a good thing for both buyers and seller. How many of us would pay the $60 for a used #5 plane at an antique mall when you can typically have one shipped to you home for less then $30 total. Over time a percentage of people will try and take advantage of a good thing and cheat the system. Common sense will help alot (don't pay more than you want/can/are able to), but buyers must also be educated in buying, read the listings, look at feedback, study past sales (especially true for high dollar sales). My guess is if some of these buyers took a little more time to educate themselves they may not have been "shilled". Yes, the sellers should be banned from ebay, but I believe the ebay system works because they still believe people are good and honest.

My take - John

[Jim Ketron]

I have seen it hapen plenty of times my wife ebays and she has bid on stuff and if no one bids on it much all the sudden some one bids on it for a lot of $$ then a week later the same person has the same thing back up again go figure;)

Jim

[Ed Falis]

I have seen it hapen plenty of times my wife ebays and she has bid on stuff and if no one bids on it much all the sudden some one bids on it for a lot of $$ then a week later the same person has the same thing back up again go figure;)

Jim

I remember looking at digital cameras last Christmas time, and definitely saw the same bidders running up the auctions at a couple of camera dealers. Then the name would change to another bidder who did the same thing.

Be careful out there!

- Ed

[JayStPeter]

I remember looking at digital cameras last Christmas time, and definitely saw the same bidders running up the auctions at a couple of camera dealers. Then the name would change to another bidder who did the same thing.

Be careful out there!

- Ed

Same thing happened to me with mid to high-end stereo receivers. I think the auctions were just ads to get you to the sellers site as the bidders were bidding the prices much higher than you could just buy the thing from the sellers web site.

Jay