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- Shill bidding is when a seller – or someone associated with a seller – bids on that seller's own item. These bids artificially increase the price or desirability of the item, and damage buyers' faith in the integrity and fairness of the marketplace. Shill Bidding is prohibited on eBay.
- Shill Bidding is harmful to buyers, because they end up paying artificially inflated prices for items. Shill Bidding distorts the bidding process, is not fair to buyers or other sellers, and harms trust in the overall marketplace.
- Shill Bidding is prohibited under the eBay User Agreement (which all members agree to when they join eBay) and by eBay marketplace policies. Shill Bidding is also illegal in many places throughout the world, with severe penalties.
- Members who engage in Shill Bidding are subject to a range of consequences. Depending on the details of the offense, the consequences can include these and more:
- A warning, accompanied by an opportunity to learn about eBay's Shill Bidding policy in order to avoid future violations
- Cancellation of listings
- Forfeit of eBay fees on cancelled listings
- Limits on account privileges
- Loss of PowerSeller status
- Account suspension
- Referral to Law Enforcement for criminal prosecution
Any combination of these can apply, even for a first offense.
- eBay members have been criminally prosecuted for Shill Bidding. Criminal prosecutions have resulted in both misdemeanor and felony convictions and large penalties, including fines and restitution of damages totaling over $100,000 in individual cases. eBay cooperates fully with Law Enforcement investigations.
- When an eBay member receives a suspension or restriction of privileges for Shill Bidding, that suspension applies to all of their eBay accounts. It is the member, not just an account, who is suspended. The member is prohibited from registering new accounts during the term of their suspension for Shill Bidding, and from using any other means to list or bid on eBay during their suspension.
- Bidding on a seller's item by the seller's family or roommates is a violation of eBay's Shill Bidding policy. Even if those members really want to win the item, the reality is that they are in a unique, special position for communicating with the seller. That position creates a situation that is unfair to other eBay members. For that reason, a seller's family or roommates may not bid on that seller's auctions … unless the seller offers, and bidder uses, eBay's "Buy It Now" option.
- Consignment shops (sometimes called 'drop shops') offer a great service for helping people sell their items on eBay. However, to avoid even the appearance of Shill Bidding, owners or employees of consignment shops may never bid on the items the shop offers for sale. If the consignment shop is part of an extended franchise operation, individuals employed within any part of the franchise are prohibited from bidding on auctions listed by any franchise member.
- When a member's eBay business grows, they sometimes hire employees to help with that business. Bidding on a seller's item by individuals employed by the seller – in any role – is a violation of eBay's Shill Bidding policy. As an eBay member and an employer, you are responsible for actions of your employees as they affect your account and your eBay business. It is important that your employees understand and follow eBay's policies. eBay has suspended member accounts as a result of actions by those member's employees.
- Merchants often do business both on eBay and in traditional stores. These merchants sometimes provide computers (sometimes called Internet Kiosks) for their drop-in customers to use in placing bids on eBay auctions. When using these computers to bid on eBay auctions, customers must always use their own eBay accounts. Merchants should keep business records documenting payment and transfer of ownership for any items won by customers bidding from such computers.
- eBay auctions provide a means for sellers to offer items to a global community of potential buyers. To enable the success of this global marketplace, buyers must have faith in the integrity and fairness of the marketplace. Any bidding on a seller's auctions by “agents” of the seller – that is, people who are working with or on behalf of the seller – distorts the marketplace and is a violation of eBay's Shill Bidding policy.
- It is against eBay policy to bid on your own items regardless of whether the bid is above or below reserve, and regardless of whether the item sells or not.
- eBay's policy on Shill Bidding is very simple:
Shill Bidding is bidding that artificially increases an item's price or apparent desirability. Shill Bidding is prohibited on eBay.
We hope this Tutorial has helped you better understand eBay's Shill Bidding policy, particularly:
- What Shill Bidding is
- How Shill Bidding harms other members
- What could happen as a result of violating eBay's Shill Bidding policy
- How you can avoid violating the Shill Bidding policy
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