Shill Bidding (2024)

FAQs

Can you get in trouble for shill bidding? ›

Shill bidding may also be considered a form of wire fraud, which is a federal offense under 18 U.S. Code Section 1343. Maximum penalties for the crime of wire fraud can include two decades imprisonment.

"In shill bidding, the sellers themselves bid for their goods via user accounts created for the purpose of boosting the price artificially, thus making more money for the article auctioned," Ingebretsen explained. He added that "this practice is as common as it is difficult to detect and prevent".

The key to detecting whether these higher-rated bidders are shill accounts is to look for the same metrics as you would look for with low-rated bidders- high volume of bids especially with this specific seller, high percentage of bids with the seller, and seemingly random collecting interests.

This could create an unfair advantage or cause another bidder to pay more than they should. We want to maintain a fair marketplace for all our users, and as such, shill bidding is prohibited on eBay.

Another method against shill bidding is to apply a software agent which automatically places a bid on a buyer's behalf just seconds before the final closing time of an auction (if the auc- tion has the pre-determined deadline like the ones in eBay).

Instead, unpaid items are usually returned to the original consignor, put into a future auction, or sold privately. Often, these backup plans result in a significant loss for the seller—and the winning bidder is obligated to make it up to them.

The seller can see no more about the amounts of the bids than anyone else can (s/he can see your actual user ID but not your hidden maximum; everyone can see your maximum bid if it is outbid or it is less than a full bid increment over the underbidder's maximum bid).

What you describe seller or friends bidding on a seller's item is against the law, and eBay has software set up to catch illegal bidding. eBay does not let sellers bid on their own items!

Pay attention to contract specifications or requirements that are unnecessarily restrictive or require expertise that only one vendor appears to have. Look out for identical bids received from different vendors. Flag any instances of a winning bidder subcontracting parts of the work to one or more losing bidders.

Do auctions have fake bidders? ›

There are two types of bidders – real and fake. Those fake bidders are those who try and register to bid but have no real intentions of bidding to win or pay for items after the auction.

A: In California, the practice of "shill bidding," where the auctioneer or someone related to the seller places bids to artificially inflate the price, is generally considered illegal and could be construed as a form of fraud.

You may not have been aware of this, or it may simply have been an oversight, but it's important to understand our policy around shill bidding. Please be sure to follow these guidelines, as shill bidding can lead to listings being removed or your account being restricted from selling.

One economic analysis of sniping suggests that sniping is a rational gain-maximizing (in other words, price-minimizing) strategy for bidders in auctions that fulfill two criteria: the end time is rigidly fixed. it is possible to gain additional information about the "true" value of the item by inspecting previous bids.

Failure to pay for items is a violation of our abusive buyer policy. When a seller cancels an order because the buyer hasn't paid, the unpaid cancellation is recorded on the buyer's account. Buyers who have excessive unpaid cancellations may have limits imposed by a seller or by eBay, or lose their buying privileges.

Yes shill bidding is illegal in most (if not all) states. I'd report him to your state's auctioneer licensing board.

eBay sellers are not allowed to bid on their own items. This is known as shill bidding and is prohibited by eBay's policies. Additionally, it may be illegal in some jurisdictions to artificially inflate the price of an item through shill bidding.

@meljo_8682 No, it's not possible to bid on your own items. Even if was that would be called shill bidding and is not just against eBay policy but it's illegal. I recommend you end the listing, revise and relist. ALWAYS start auctions at a price you will be happy with if you get just one bid.

If RECO determines that a listing agent has submitted a phantom bid, the agent could have to pay a maximum fine of $50,000 or spend up to two years behind bars! If that isn't reason enough to stay far, far away from phantom bids, you've got to be quite the risk-taking real estate agent.