The latest in a series of interesting legal developments related to eBay in the past few years, breaking news today is the case of an eBay seller in the UK who faces up to £50,000 in fines for shill bidding his own auctions. The Daily Mail reports this is the first case in which someone is being fined for such activities.
Paul Barrett, 39, plead guilty to “ten breaches” under UK consumer protection laws. The Daily Mail states that “[t]he fair trading laws were brought in two years ago to bring Britain into line with the EU“.
The merits of shill bidding – legally and ethically – have long been debated in the original prop collecting hobby. I personally recall having debates with a member of the Movie Prop Forum years ago, who argued that there was nothing wrong with bidding on your own items listed on eBay or consigned to auction, so long as you were willing to pay that for your own items.
Some feel that it is unethical for dealers, auction houses, and consignors to participate in their own auction and sale events. There are a number of reasons for this, including the fact that those involved in the auction are often privy to additional information, which leaves the public at a disadvantage. It also leaves open the possibility of those who might gain from higher prices realized to manipulate the outcome of the auction to their benefit. At the very least, any such activities may lead to an appearance of impropriety. “Shill bidding” is usually considered to be an activity in which someone bids on their own for sale items with the hopes of driving up the price – not winning the auction.
This is an issue that has been at the center of previous Original Prop Blog features:
Today’s news development has been covered by The Sun, The Mirror, and The Daily Mail.
The Sun reports that “[a] court heard Barrett opened a second eBay account then bid on cars, mobiles and other items he had put on sale – pushing up their prices” and that afterward he “posted gushing reviews on his trading from the other account“.
The Daily Mail obtained a statement from an eBay spokesperson who said that shill bidding was illegal:
It is important for people to understand that there is not, nor has there ever been, room for illegal activity on the site.
In the same article is a statement to the court from Barrett who explained, “eBay let me open up the second account and I gave all my personal details and home address to do so“.
It is common practice for eBay users to have multiple accounts, though I have personally seen no evidence of eBay having automated systems in place which detect and act on shill bidding activities. Coupled with eBay’s trend of creating policies which diminish transparency (see eBay Announces More “Progress”, Less Transparency), it makes it a more risky and challenging marketplace for consumers to navigate.
Past articles published by the Original Prop Blog related to other legal disputes and court proceedings can be found via the portal below:
Jason DeBord