Shill Bidding Plagues Auction Business

There is no mistaking shill bidding on the Internet. A couple of clicks into an advanced search on the bid history of an item reveals every bid placed on that lot. Anyone who bids on Yahoo!Auctions or eBay lots should navigate this avenue.
There. Now you're warned. On Yahoo!Auction recently, a signed Mark McGwire baseball shows the bidding moving north about $200, in mostly $5 and $10 increments, in three minutes, all from the same bidder. Why would anyone bid against himself? Such bidding pushed the price of the item up from $580 to $775. Then, for the first time in 26 bids, a new bidder jumped in at $800. The first bidder would never be heard from again, and the newcomer would win at $810. The winning bidder discovered the "bid history" hotlink, unfortunately, after time ran out.

This phenomenon is known as shill bidding. It's uncertain whether the problem is pervasive, but it has received the attention of law enforcement officials, including the Federal Bureau of Investigation, after escalating bidding on a masterpiece painting soared to the extent that it made national headlines and yielded an admission of bumping up the price as fast as a cold front blows down from Canada. Internet auctions are at least sensitive to the problem. Numerous sellers, suspected of engaging in shill bidding, have been suspended for such and other practices. To angels and moral human souls, that would be enough shame to make a culprit disappear. However, in the faceless, anonymous world of Internet auctions, this is akin to sending a chronic mischief maker to the corner for five minutes.

In cyberspace, suspended users return in the form of aliases. They just take on a new name. Bump them off and they just come back as another User ID. Sellers on auctions have more lives than cats, more faces than Dr. No. Shill bidding affects unsuspecting bidders and the most sophisticated bidder alike. With live or phone auctions, bid histories are held in secrecy. They are not disclosed, unlike the bid history of Yahoo!Auctions. Auction companies are supposed to be as trusted and untampered as your banker. No doubt many of them are. There's simply too much at stake, particularly with companies that have spent years and a lot of money building their brand name.

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