Skip to comments.Revealed: how eBay sellers fix auctions
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 UKs 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 worlds 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 eBays 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, eBays 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 eBays 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 Christs 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). Dont call it shill bidding. Then I wont be accused of shill bidding. Yes. I mean Ive got people.
Ive 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 . . . youre a multi- millionaire. You buy a hundred grands 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 whos 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.
And "Froogle" the new items. Most of the time you can find them cheaper.
When I know a user is shill bidding, I just don't bid on his auctions.
This is a problem that can police itself easily.
Never put in a maximum bid you aren't willing to pay for that item.
If you don't like how the transaction goes, tell that in the feedback.
I don't trust Ebay, and won't use it; it's a carney's dream.
>>Shill bidding has been going on since ebay got started.
Actually, since auctions got started (live and virtual).
I've shopped on Ebay for years and am a very savy shopper. I know the value of things and what the maximum is that I'm willing to pay for an item.
I've gotten some terrific buys on Ebay and have found items that are either no longer available or can't find locally. I've decorated most of my home (knicknacks, books, hard to find CD's) with stuff that I've purchased from them.
Have I gotten ripped off there? Yes, a couple of times and fortunately it wasn't for more a than a few dollars.
Buyers simply have to be careful and not go beyond what they are willing and able to pay.
I thought the seller could place a minimum bid or a reserve on an item.
I've had problems twice on eBay since I've been a member (7 years).
Between the eBay reporting system, PayPal, Square Trade and the Post Master General, I've had no problems resolving them.
Things must be pretty quiet in the UK if they consider this a scandal.
I'm sorry, but you can't stop shill bidding. Any seller with any brains at all can do it without even getting noticed. Plus it is very hard to prove. This is yet another thing that makes for a good story, but would be a waste of law enforcement effort to actually investigate.
Just a casual user of e-Bay - but we have had problems - misrepresented articles, seller backing out after a successful low bid, etc. - about 40% of the time. Have had a number of friends who rave about their 'buys' and know one couple that made a pretty respectable 'living' (@100K/year) selling on eBay stuff they picked up at yard sales.
I know that on camera equipment, particularly stuff like the Canon professional quality gear, I never even check eBay. B&H sells it new for less than what some morons are willing to pay for used equipment.
Caveat emptor applies more to stores. eBay has a large selling population of garage sale type environment.
The blame should not be on Ebay. The blame is on the abusers.
The trick is knowing exactly what you want, and exactly what you're willing to pay, and always be willing to walk away.
I would say the experience is the equivalent of going to market kiosks.
And who doesn't love a flea market?