Dismay at eBay's unsatisfactory response to 'bid shielding' offences

Growth in high bids which vanish sparks concern among auction site users

Helen Soteriou
Thursday May 17, 2007
The Guardian

Lucy thought she had got something good: she was selling her tickets for the NME tour at the Brixton Academy on eBay, and with just 20 minutes to go the highest bid of £21 had abruptly been trumped by one for £56. The only odd thing was the new high bidder had no eBay feedback - suggesting they were very new to eBay. With the new offer so far over the others, nobody more bothered to bid.

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But seconds before the end of the auction, the new bidder withdrew the bid, leaving the original £21 bidder in the lead with a bargain.

Lucy smelled a rat. Looking around, she found that that same "zero feedback" user was bidding high for tickets for the same gig - and then repeatedly withdrawing moments from the end. And the winning bid? Always from the same person who had just won Lucy's auction. She refused to sell the tickets, suspecting a tout trying to corner the market, and declined the PayPal transaction for the auction.

Lucy had been a victim of "bid shielding", in which one account is used to make extravagant bids for items in order to shield smaller bids by another account.

Since eBay accounts can be set up for free, the shielding account can be junked if eBay targets it. And if both accounts come under suspicion, both can be thrown away.

The current, and (judging by the angry messages swelling eBay's message boards) growing problem with bid shielding seems to have grown directly from two recent eBay actions: hiding bidders' identities; and allowing people to withdraw bids without giving the seller the chance to extend the bidding or ban certain bidders.

The new system by which bidders' identities are hidden - called "Safeguarding Members' Identities" - was implemented in January - because of the growth in "second chance" frauds, particularly in car sales, where people who had failed in a bid were sent an email telling them that the winning bidder had declined to pay, and offering a second chance to buy the item - but not through eBay's payment mechanism. That led to spiralling fraud in which buyers sent money but were not protected by eBay's protection schemes.

But the changes have made it easy for buyers to game the system, and protect mediocre bids with huge ones before withdrawing them.

EBay's North American president, Bill Cobb, said that he was aware of members' concerns and is taking the necessary measures to ensure there is no increase in bid shielding. However, he could not discuss the specific measures for security reasons.

As for Lucy, she challenged the winning second-placed bidder in an email. The reply denied the accusations and told her there was "little or no point" going to eBay: "I've had problems with zero-feedbackers before ... you can't do much about them as if they get kicked off eBay, who loses?"

Who indeed? Certainly not eBay, since if the transaction goes through to the second bidder, it still gets a cut. Not the second bidder, who gets a bargain. Not the mysterious un-bidder, who had no eBay reputation to lose. Only the seller, who cannot see behind the eBay IDs to learn more about who is doing what.

When Lucy complained to eBay, it responded with a long email - apparently boilerplate - saying, in part: "Bid manipulation by using the retraction option is considered to be a bidding offence on eBay for which disciplinary action may range from a formal warning, up to the indefinite suspension of the member's account ... Thank you for helping to keep eBay a safe, fun place to buy and sell."

When the Guardian told eBay the user names of the two bidders, eBay responded: "We have investigated the accounts in question, and we cannot find any evidence of suspicious activity."

And Lucy's conclusion? She and her mother "have lost confidence in eBay and would not contemplate selling any items again".

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