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How eBay Sellers Fix Auctions
Boj writes "The Times online is carrying stories on fraud carried out on eBay using shill bidding. Citing eBay's changes to security as aiding the shill bidders and this fraud:
"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.""
Anyways, for new items, I usually can get them cheaper locally from a brick and mortar store. The days of getting good deals all the time on eBay are gone. And I don't have the time or desire to hang out there all the time waiting for that one good deal.
Locally, craigslist, baby!
Then what the seller does is send you a "second chance" email if you are the last bidder saying that the original bidder didn't pay or what not and lets you pay what they were offering for the item. The Second Chance is now an offical Ebay thing... which of course is being abused by the Shrills...
Because you can look at the user feedback and see if there is a lot of cross-feed-backing going on between the involved parties and also you can see if these are low-feedback users raising the bid.
;-)
I had this happening to me once. I'd put in a bid and then somebody would raise it and raise it again until just topping my bid, then withdraw the highest bid. Complained to EBay but they did nothing. In the end, I waited a while after the shill's last bid, then put in a bid of my own. The shill really quickly raised it again a few times then withdrew his last bid that topped mine. At which point, I withdrew my last bid and left the shill in the winning position with a few seconds to go and a bid that was too old to withdraw. So he ended up paying EBay for the privilege of selling the item to himself
----------------------------------- My Other Sig Is Hilarious -----------------------------------
I still got the tickets at good prices but a bit more than i really wanted to spend
Set yourself a maximum you are willing to spend.
Write it down.
Never exceed it in a bidding war.
Shill bidding simply means to me getting it in my price range when they withdraw, or it goes to someone else. If I suspect shill bidding and the last bid is withdrawn frequently on a paticular seller, then I expect the withdraw and withdraw myself, then send the seller a note of my reasons.. Suspected shill competition. Then I no longer bid on that merchant's products.
The truth shall set you free!
its just ridiculous because they're already determined its a valid dispute.. the stupid bastards cancelled all his auctions and suspended the seller's account.. doesn't that give me the right to automatically start this damn dispute so I can get my money back? of course not.. I could of stopped payment on the Money Order, but I rather keep this fight with eBay going.. there's still quite a bit of work they need to do to stop all this fraud.. I've filed formal complaints with I3C and with the USPS for mail fraud..
I guess what is equally as ridiculous is the fact that someone would go through so much time listing auctions for a measley 30 bucks, and having the possibility of getting charged for mail fraud and being under investigation by the IC3..
*plays the Apogee theme song music*
If you bid $100 in an ebay auction, that means you'll pay up to $100 for it, but less if there is no competition for the item. Manufacturing false competition to drive up prices is fraud and against the spirit of the auction, even if no one is forced to pay more than they're willing to pay.
If the rules were simpler and you simply entered a fixed bid, then what you say would apply. However, the rules say you'll only pay a small amount more than the next highest bid. Pumping that up via fake bidding breaks the system.
Personally, I avoid eBay like a plague. it's got sucker written all over it.
Well, that may be. But they stay in business for a reason. If I have something to sell, I can reach a larger market than I can locally. And when I'm looking for some uber rare item that it would take years and thousands of dollars in gasoline to find by scouring every used record store, book store, person's home, etc., ebay comes in very handy.
I've only been burned a couple of times (out of several hundred transactions) and then only for low value items.
My own personal strategies for a succesful transaction include:
1) Never bid on camcorders, computers, automobiles, or any other high dollar item.
2) Always do an extensive check of the seller's feedback.
3) Don't bid early or get involved in bidding wars. Snipe instead.
I have to say that trying to claim someone somehow *forced* you pay too much for an item, after you already agreed to it by entering a maximum bid is pretty laughable. How does creating the illusion of high demand for your useless junk amount to criminal fraud? Sure, it might seem unethical, but how is it any worse than writing a clever description for an item that makes it seem better than it really is? (Just like all those other modern advertisements you're exposed to hundreds of times each day.)
If you've actually been a "victim" of a shilled auction, maybe you should focus on becoming a more intelligent buyer, rather than accusing the seller for being creative enough to draw you into a legally binding sale. Nothing illegal has happened here. You lost no more money on the item than you were willing to pay for it. The only thing that did happen is that greed/hoarding instincts or need for instant gratification overruled your judgement for that fraction of a second where you clicked the "submit bid" button before looking for any other sellers offering the same item.
A sucker truly is born every minute... and no place shows it more than eBay.
8==8 Bones 8==8
I see all kinds of accusatory posts which I would have to disagree with. I've been a long time eBay user and that's mostly as a seller (a silver powerseller for a chunk of it). Now I never participated in shill bidding and would even ban friends of mine from bidding on my auctions. Occasionally I'd shoot them a link to just show them what I had posted and they'd bid on it (usually to get it started) thinking they'd be doing me a favor. For example, if I was selling a $500 monitor they might have bid $40 or something. However, I want absolutely nothing to do with this and I will add their user IDs to be banned from bidding on my auctions the second I see this.
Why? Because I have seen/spoke with people that took part in shill bidding. This will include people that just did it every few auctions and were Gold Powersellers, with well over 1000 positive feedback. Guess what happened to them? Two different things - automatic account termination and/or warnings. I've seen a huge seller (makes $$ for eBay you know) have their account closed, no questions asked. This (AFAIK) was not as a result of a complaint either. We're not talking these retards that bid up the auction and then cancel once they see what the first place bidder's amount was.
Anyway, I would say eBay does a good deal to try and stop this practice. So I'd ask that some people not post unless they know what they're talking about. It seems like a lot of people are talking out of their asses. It can be difficult to catch everything on a site that busy. Why don't you just go solve the problem for them instead of posting useless bullshit here.
A friend of mine has been scammed twice. He was trying to purchase a new fancy phone. The first time he found a good deal but made the mistake of not focusing on the reviews from other buyers. He paid his dues but never received a product...Out 400 bucks.
Scam numer0 2 was a bit more shiesty. He purchased a phone from someone over sea's. This was about 600 bucks, the guy had great reviews and it seemed like a winner. After he placed his purchase a month passed...No phone. So he decided to contact the seller. The seller said he sent the package and he had it insured and would claim the insurance and resend another phone....Weeks later still nothing. One day my friend received a box. Hoping for his phone he noticed that the address on the box was totally butchered. A number here on the address was missing, part of the street name was gone. It looked like the sender did it on purpose. Upon opening the box were 2 apples....We never got a hold of the seller. This was the senders trick. He received payment on the phone and then intentionally butchering the address so he could then claim the insurance payout...for another 600 bucks. The seller came out way on top and was never found again.
This is one of many reasons I avoid Ebay.
The greatest revenge in life is massive success.
Imagine your wife's grandma's heirloom china set is worth $400 on the market, but priceless to her. You have recently dropped one plate, and it's irreplaceable. The plate is worth $80 on the market. 6 months later, you see the plate on Ebay, drawing insipid bidding, reflecting relatively low demand, stuck at $40. Your web design business has been doing well, and you can afford $200 to get back in grace with your wife. You therefore bid $200, raising the current bid to $42. On the final day, you see a series of bids in , all by the same person, raising the price to $160. This is the point at which the shiller did not dare to raise the bid for fear of outbidding you.
Effectively, he got free information about how much you are willing to bid. Information is money. It's like when you're bargaining on a used care--you start with your offer. You don't tell the salesman how much money you brought, and then start bargaining.
In the example above, you pay less than the item is worth TO YOU, but more than market, because the shiller was able to tease that info out of you.
Hidden referrals are weak.
I think there is a world market for maybe five personal web logs.
I've only bought a few things over the years, but I have received the infamous email stating the winning bidder didn't pay and they were now offering me the chance to purchase the item.
To make a long story short I was willing to pay $25 but got the email asking me to pay $30 because the high bidder didn't pay. I offered $20 (which was my bid until 23rd hour bid) which was rejected. The item was re-listed and the exact thing happened again. Again I offered $20 when I got the email, again it was rejected by the seller. Apparently the third time I was the 2nd highest bidder, the seller finally figured it was best just to accept my offer of $20 and stop losing money on re-listing.
You just have to be stubborn when you suspect you're getting played. If the item isn't highly sought after, eventually the seller will realize they will keep losing money by playing these games.
"Action without philosophy is a lethal weapon; philosophy without action is worthless."
So, they just pretend they made a typographical error and the possible suspension is irrelevant, because it's a shill account anyway. It happens all the time.
Dammit Otto, you have lupus.
(a) Because it is worth $100?
(b) Because you are no longer participating in an auction. Instead of paying the lowest price that no one else is willing to pay, you are paying the highest price you are willing to pay. This is fraud. You either missed my point, or intentionally snipped out the part where the OP was complaining it was only worth 50 bucks. His example stinks, and makes whatever point he's trying to make basically sound like whining.
No.
In economics, there is a long established and useful concept called consumer surplus. It is based on the fact that some consumers value an item at much higher than the going rate, but that their number is small enough that it would not be in the seller's interest to sell a smaller quantity at a higher price.
For example, say that I am extremely hungry and have a class in 10 minutes. I might be willing to pay $5 for a slice of pizza at the cafeteria nearest to my classroom, due to reasons of both timing and hunger. However, since the cafeteria can't read people's minds, and because of various local trade laws and issues of practicality, they must charge the same price to everyone. Say that the optimal price based on average demand and the cost of supplying pizza, both in labor and materials, is $1.50. So I buy a slice for $1.50 and I am left with a consumer surplus of $3.50.
This example is to say that people often value an item above the market clearing price (or below it, in which case they don't buy), and that the fraud being committed is fraud, because it artificially inflates the market price with bids of buyers who do not intend to pay, and who are in collusion with the seller.
In our pizza example, if a store employee out of uniform had stood next to me and tried to outbid me on pizza, until my reservation price ($5) was reached, that would be fraud. When someone misrepresents themself in a commercial transaction, it is fraud. All the bidders are transactors in an auction, not just the winner.
This sig has not been evaluated by the FDA. It is not designed to diagnose, treat, prevent, or cure any disease.
The problem is that once an item is received, most people rate it instantly and then don't have any obvious way to revise their rating. They have no way to alert other buyers that the seller is suspect. And if they do detect a fraud, their negative is drowned by a sea of green because the fraudster knows most people rate the second they open their package.
EBay should provide the proper and direct tools for buyers to rapidly highlight fraud. You might claim that it's the user's responsibility to check the device, but the fraudsters rely on the wheels of Ebay grinding so slowly that more people are suckered before anybody notices. By the time you fill out some stupid form and wait 2 weeks in the resolution centre, hundreds or even thousands of others have bought into the same con. Some item categories should feature a second chance for the user to report an item. Buyers should be randomly surveyed about items. Certain categories should contain mandatory warnings, fraud information snippets and "report fraud" links tacked onto every sale. Buyers should be able to see the negative / neutral ratings in a single page for a "gist" of the negative issues. EBay could even buy items from suspect sellers and confirm for themselves. The fact is that memory card fraud is rampant and EBay could be doing more to stop it, yet they sit on their hands until it gets too much.
Go and search for "4gb memory stick" - I bet virtually every one of them will turn out to be a fake. I'm sure EBay knows this too.
The real question is.. WHAT DID YOU DO?
I waited three weeks for the item to ship and then reported it as undelivered. Between my ordering and that time, the account of the seller was suspended, but only after countless people had also purchased cards. As it happens my package actually did turn up but it was a forgery so I continued and finally won my dispute. I reckon the guy had a good 8 weeks over the busy Christmas period of sending nothing but fakes out and knowing most people wouldn't even check the product before rating it. The guy still had a 98.5% rating at the end.
Fact is that EBay could do more. They just choose not to.
Right, that's the way real world auctions work. Ebay has different rules. I do believe back when ebay started and there was actually serious competition, there was another online auction house for which snipeing did not work. On that system, whenever a bid was placed, the auction was extended to last at least another 5 minutes. Thus, you couldn't snipe. Now, similar to an ebay auction it meant you might have to go to the site or read your email and rebid if desired. It also meant you didn't know how long you'd have to watch that auction before it would finish. In the end, we can see ebay didn't go that route. I think people found just bidding their maximum offer works just fine and haggling for an hour at the end of the auction wasn't worth everyone's time.
If you've bid the maximum amount you'd be willing to pay for an auction, the only thing a snipe bid denys you is the better deal you were hoping to get. If they bid earlier, you'd still not get that better deal. The sniping just let you hold onto the hope a bit longer. Why do I snipe? I don't want to deal with the people who don't bid their maximum amount, watch the auction for competition, get emotionally invested in winning the auction, and push up the price I have to pay. By sniping the auction for the amount I'm willing to pay, I win the auction for what I'm willing to pay, and don't if the auction goes higher. There are 2 useful differences between this and a standard bid:
1. People don't get to look at my bid and respond to it. Their bid of how much they're willing
to pay is the only response they get.
2. My bid is retractable up until the time of the auction. This means that I can bid on 10
auctions for identical (to me) items, and stop the other bids if i win an auction.
I find the 2nd benefit quite useful. Ebay doesn't offer anything like this ability. I often shop for items on ebay, find 10 perfectly reasonable auctions, but on ebay I can only bid on 1 auction at a time. Using a sniping system, I can bid on all and set it up to stop when it wins an auction.
Sniping isn't about being an irritant to anyone else. It's just more efficient. If ebay itself offered this bidding option, the seller would essentially get no feedback on his auction until the end, and there wouldn't be any bidding wars to raise the prices. There also wouldn't be any shill bidding, as a reserve bid would work just as well. In my opinion, using sniping bids makes you be diciplined about your bid. You must carefully decide what your maximum bid amount should be (but, you can also change that before the end of the auction, but you can change it up _or_ down). In my opinion, if you're not using the snipe bidding, you aren't shopping as efficiently and carfully as you could.
Andrew
but it's still an asshole move most often capitalized upon by people with less active lives that have time resources to snipe in whenever their auction of interest happens to be ending.
Here:
http://www.jbidwatcher.com/
Now you too can snipe w/out having to sacrifice your active lifestyle.
Just configure it with the auction number to snipe - the amount you want to snipe - and go on with life.
First they burn books, then they burn people.
Spacezilla, seller can always pull the item if no one bids above him/her. S/he doesn't have to pay anything. I've seen the exact same items on eBay up for bid time and time again. And these are not items which have "reserve" bottom line bids.
OK sorry but, at this point, you've pretty much shown here that you're not familiar with what you're talking about. You _can't_ bid on your own auctions on eBay, period. If joe1234 is listing the item, joe1234 can't bid on it. I've tested that, it's an obvious thing for them to check for at bid time, and they do. And, just because personA buys from personB a lot, doesn't mean they're the same person. I've got a few sellers who I've bought from literally dozens of times. I bid on most of their auctions, because what they sell and what I buy are the same thing. I lowball every one of one guy's listings, and get about 10% of them. (this is on a commodity with an established value - I bid 10 or 15% back and get them sometimes). I figure if someone is going to get his goods on the cheap, it might as well be me.
Now, to an outside observer, they might see my ID bidding on most or all of his auctions, always near the end price, and think I'm a shill. I'm pretty sure he's not me and I'm not him, what with us being about 1200 miles apart. But how is an outside observer going to differentiate my buying pattern in regards to him, as me not being his shill? "Joe keeps bidding on Tim's stuff, always near the max bid, so Joe must be Tim" doesn't cut it. Yet it seems to be how some people think they're recognizing a shill bidder.
Settle down there sparky, no need to shout. My only point was, either the item is worth 50 bucks to you, or up to 100 bucks to you. If it's not worth up to 100 bucks to you, don't bid up to 100 bucks.
My example is extreme, but it demonstrates the problem with shill bidding.
No, it demonstrates the problem with someone bidding more than they want to pay for an item. I wasn't addressing shills at all, I was specifically addressing complaining about bidding (x) for an item and then paying (x) for it, for whatever reason.
Because he was defrauded out of $45. What part of fraud do you not understand? (heavy sigh) What is this, National Intentionally Missing The Farking Point Day? I _said_ I'm not defending shill bidders. I've even described in another sub-discussion on this thread a bidding pattern that I personally have with a seller, which someone who is into making assumptions might think was me being his shill. It's perfectly legitimate. Does shilling happen? Of course. Is it bad? Obviously. Do I support or condone it? Of course not. My entire point was, if dude only wanted to pay 50 bucks for something, dude shouldn't have bid 100 bucks on it. Sheesh.
It is against the ebay rules. And if you're in a situation where it seems apparent that it might be happening, they have submission form in their documentation specifically for shilling complaints. And in fact, they do enforce the policy in my experience.
/not/ illegal, and they get a larger cut for auctions configured for reserves. Simply setting a reserve guarantees that ebay will receive no less than 1% of the reserve price (and substantially more for items less than about $150). If they allow shill bidding to take place, they lose money. For example, suppose you have a playstation 3 you want to sell and you don't want to let it go for less than $850. If you start the auction at $850, you pay $4.80 to insert it. If you start the bidding at less than a dollar, you take the risk of not meeting your final price, but the insertion fee is cut to only 20 cents. If you start bidding under a dollar and place an $850 reserve, it's %8.70 to start the auction. In each case, closing costs would be 3% of the winning bid plus 56 cents (since it's 5.25% on the first $25). So in this example, if a shiller were to start bidding under a dollar with no reserve, they would have to push the price up to about $1000 or $1130 for the closing fees to match the higher starting bid and reserve situations above, respectively. And the lower the final price, the bigger the difference is in the fees. In the case of an item with a 49.99 reserve selling for $50, the same item would have to sell for $83 without a reserve to generate the same fee. While it is possible that they could make more money by looking the other way for shills, there's a strong chance they'll alienate their users with high prices and frustrating auctions, face legal action if it can be shown that they looked the other way, and in all likelihood make less money than if they were to do the job themselves with reserve prices. Behold the almighty dollar.
I took part in an auction a few months ago which seemed to me to be a clear cut case of shilling. I put a low-ball bid in on a video game, got outbid, and came back the next day (after purchasing it elsewhere) to find that the winning bid that outbid mine had been cancelled but that my bid had been extended to its very top value (I think it was at $1 when I first took the top spot and I'd only offered up to $2). So before paying, I inquired with the seller as to why the other bidder's bid had been retracted. I made no statement toward either having bought the item elsewhere or toward ebay's narrow criteria for allowing retractions. I simply asked why it happened, and the reply to me was something like "Well if you don't want to pay, you should have said something sooner" or some similar BS. So then I wrote a message to the shill bidding department asking for advice of how I should proceed since, as far as I could tell, the anomolous bidding had disrupted the integrity of the auction. A few days later, I recieved an email from their loss prevention department stating hat the seller's account had been terminated and that I should not pay for the auction, as well as informing me of a few options for how I could get a refund if I had already paid. My only complaint about the process is that the form letter said I would be informed of the results of their investigation in 24-48 hours, but it was more like 72.
But anyway, there's are two strong motivations for ebay to enforce a strict anti-shilling policy: first, it's illegal in many places. Second, and more importantly, is that setting a reserve price is
Ebay only pushes your bid up to the reserve if your maximum is over the reserve. If your bid is below the reserve it allows it to stay at the starting price (or does the normal bidding war between you and the other seller).
Paul
Ebayers get into a religious war about sniping (and every conceivable "feature" in the system) and generally resort to this "you're a moron, I'm a professional" baloney.
/worse/ than you because you're hoping that last millisecond $50 up only costs you $0.50.
No, the problem is they're combining a Vickrey auction with an English auction--then adding an arbitrary stop-watch--and that encourages sniping and rampant shill bidding. People who point this out aren't morons, they just recognize a bad system when they see one.
For bid once, bid max to work, you actually have to be forced into having only ONE bid. Once you can submit subsequent bids, no one will reveal their true max until the last possible moment, because you have no reason to believe anyone else will behave any differently. The stopwatch identified by the previous poster IS the problem. Because of the combination of sealed-yet-easily-opened bids, you reduce it to a few seconds of English auction with the reserve set by a week of unfortunate souls who've tipped their hands. What you end up with is underbidding for fear of being automatically ratched-up by shills and overbidding in a desperate attempt to outrun the shills and everyone else in a sprint to beat the clock hoping to god no one else has overbid
This is not good auction design, but it is easily fixed: enforce single-bids or reset the clock. If you do the former, you force the humans to be truthful--and completely eliminate any incentive to shill--and if you do the later, you remove the incentive to engage in the robotic 100 millisecond dash.
But, one can imagine that some very talented statisticians at eBay have figured out that the current system results in significant net overbidding and that means more money, so while it may be broken, they ain't going to fix it any time soon.
So which of your countries is it? USA? Canada? The Netherlands? County != Country
SWM seeks new sig for a brief fling