An article in Sunday's London Times reveals first hand how some unscrupulous sellers on eBay (NASDAQ:EBAY) are defrauding honest customers out of their hard-earned cash. A reporter, posing as a well-to-do individual looking to sell high value antiquities, easily talked one of eBay UK's largest sellers into admitting that, oftentimes, the practice of shill bidding was used to assure adequate value for items sold on eBay.
In explaining how the process of shill bidding to inflate prices is accomplished, the subject of the interview stated:
"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."
In response to the investigation, eBay claims that its new practice of hiding user ID's from view during the course of bidding has helped to address the shill bidding problem. I and many of my fellow sellers fail to see the connection. In times past it was fairly simple to formulate and chart patterns regarding systematic bid manipulation by specific seller groups, and we had success in shutting some of them down. Now however, there has been a iron wall placed between the identities of bidders and the balance of the eBay populace. This means that eBay itself is solely responsible for scouting its site for bidding violations, and I feel eBay's actions have made it abundantly clear that while the company will try to help, it's really not eBay's responsibility to protect you or your money.
I want to know: how does reducing transparency within the eBay auction venue result in greater safety for eBay buyers? It's problematic that eBay is only set to gain from high prices; if fraudulent sales practices do drive up final value fees, eBay's bottom line is given a boost. Obviously shill bidding is not an accepted practice; but why would eBay create the appearance of trying to hide it?
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Reader Comments (Page 1 of 1)
1-30-2007 @ 11:05PM
Ryan said...
Valid point. I tend to agree with you to a point. But from my understanding the ability to still see feedback stars should help (not to be confused with solve) diminish the rust factor of bid history.
Meanwhile on another large front... The masking of user id's helps resolve the ability for fraudsters to harvest user id's off big ticket and higher priced selling items. I think that is a larger concern at this point since the use of fake second chance offers and new users equals new users being taken advantage of. That's way bad press...
No doubt this is a tough act but eBay seems to push and pull levers, tweaking things here and there. In the end most seem to help and some don't. No one said it was gonna be easy but to me at least they seem to try and address some of the issues that many complained about last year (maybe on this blog channel). Next year they might have a better answer to this issue and maybe not. But they gotta try and test it to see if it does...
Food for thought anyways.
Cheers
1-30-2007 @ 11:08PM
Chiesa said...
The article by Times barely scratch the surface of eBay scams. eBay is only interested in the volume business, that's why the customer service is practically non existent.
http://ebayweirdal.blogspot.com/
1-30-2007 @ 11:13PM
Jonathan Berr said...
There's always been shill bidding on eBay. I did it a little myself before I learned better.
2-01-2007 @ 2:45AM
Tracy Riggs said...
Shill bidding has been around for centuries. Go to any Auction in the USA and you will find shill bidding quite normal. If the Auction house has a valuable piece for sale at an auction,( it will have a minimum bid on the item to protect the seller asking price.) Many sellers at an auction will sell an item and then they themselves or relatives will bid against the buyer to raise the price to where they think it should be. Or the Auctioneer will invent a non exist bidder, lol... ( It is understood in auction circles that this is quite normal) The bidder wanting to buy the item can back out anytime he thinks the price is too high:) Therefore he is not getting scammed. There is no such thing as getting scammed at an auction. You have a seller who wants the most he can get for his merchandise. You have a buyer who will pay what he thinks it is worth it to him. The BUYER or BIDDER can back out and stop bidding anytime. Therefore he is not getting scammed.
EXAMPLE: I can list a 1,000 dollar pair of gold earings on eBay two ways. One: for my asking price ( Buy now) or I can put a minimum to protect my asking price, or I can start out with 1.00 and no minimum. If I start with one dollar and no minimum there is a chance that one person will bid on my 1,000 dollar earings and win if no one else bids. lol. It is in these cases where shill bidding comes in. The owner or a relative will bid up the item to where they want to actually sell. ( People like that do it because they don't want to pay the higher listing fee to start with) Again! People are not getting scammed.
The BUYER or BIDDER can STOP BIDDING anytime he thinks the price is too high. He loses nothing.
2-05-2007 @ 11:04AM
Bob said...
The "protecting users from fake second chance offers" canard was ludicrous. eBay ought simply to have removed the ability to offer second chance offers, if that was the fear.