At long last I can give eBay Inc. (NASDAQ: EBAY) a pat on the back about something. Most of you know that's pretty hard for me, but this time eBay has gone the extra mile to prove to me that it at least recognizes there are some nasty pirates and profiteers operating on its site. With the direction of New York Attorney General Andrew Cuomo's office, eBay assisted in putting the clampdown on an unscrupulous jewelry seller that was ripping off eBay customers by placing price inflating bids on its own merchandise.

EMH Group, the company in question, is said to have placed nearly a quarter million fraudulent bids on nearly $5 million worth of merchandise within the period of one year. Of course, EMH claims no wrong doing, but it has agreed to pay $400,000 in fines and will be "banned" from the online auction industry for four years. As for its victims, it is said that there will be a buyback incentive program "for certain items." I'll bet those certain items are all gold and EMH expects to purchase them back at the previous sale price. Yeah, ain't that just peachy.

Yes, I'll give eBay a pat on the back for exposing just how easy it has been to make millions of dollars of fraudulent business on its site. As far as Attorney General Cuomo's part in this, until he sends someone to prison for stealing from the public like this, in my opinion he's just blowing smoke in our eyes to the tune of $400,000. Without even checking, I'll give you 15 to 1 odds he's a Harvard man.

And so it goes.

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?