eBay has restricted one of the largest trading card sellers on the marketplace, accusing the seller of engaging in shill bidding. In a rare public statement about an enforcement action it took against a seller, the company sent an email earlier this week to trading card buyers on its platform.
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“Recently, it was determined that individuals associated with trading card seller, PWCC, have engaged in “shill bidding,” which is prohibited on eBay. As a result, eBay has restricted PWCC’s selling privileges and listings, effective today.”From eBay Email to Trading Card Buyers
PWCC had nearly 18,000 listings on eBay at the beginning of the week, but they were all removed from the marketplace because of this action by eBay.
In a statement, PWCC rebutted eBay’s claim saying, “to PWCC’s knowledge, its employees have never engaged in any behavior that violates eBay’s agreements and policies. PWCC goes to great lengths to ensure that its employees follow eBay’s rules and PWCC employees do not have access to eBay’s bidding records or information.”
Furthermore, PWCC said it is considering “all available legal options in response to eBay’s defamatory press release and its bad faith action to restrict PWCC’s privileges on eBay.”
What is Shill Bidding on eBay?
The practice of shill bidding dates to eBay’s earliest days. Sellers would set up two accounts, one for selling and one for bidding on items they listed for sale. This way sellers could run up bids on their own items once an item received a bid from a legitimate buyer.
Especially as an eBay auction nears its scheduled end, often more interested buyers watch items and place bids as new bids come in from other buyers. If one of the other buyers is the seller itself, the seller could run up the price of the auction and buyers could end up paying more for an item than they should.
Some buyers also use eBay’s automatic bidding feature, which allows them to set a maximum bid amount. In this case, eBay would automatically place a new bid by the buyer because of a seller’s shill bid.
Sellers, who engage in shill bidding, may use the same tactic to run up the price of an item to a minimum level, effectively creating a hidden reserve price without the auction being listed as having a reserve price.
The reason for using a hidden reserve price is that many sellers believe less buyers engage in bidding when they know they must meet a reserve.
eBay cracking down on shill bidding is understandable. It gives sellers an unfair advantage that buyers are unaware of, which often results in buyers paying more for an item than they should.
The company says it “has a number of systems in place to detect and monitor bidding patterns and practices,” but despite all its best efforts, the practice continues today. Read eBay’s shill bidding policy here.
What Will Happen to Trading Card Seller PWCC?
As mentioned earlier, it is extremely rare for eBay to publicly comment on an enforcement action it took against a user. The fact that eBay went out of its way to inform trading card buyers, it knew that suddenly removing nearly 18,000 listings from a high-profile seller would be noticed by the trading cards community. eBay had no choice but to address the action publicly.
PWCC said that it will conduct an internal investigation into the matter. eBay did not say if the restriction is temporary or permanent and if the marketplace may consider allowing PWCC to list items again in the future.
But PWCC appears to be done with eBay, regardless.
The company confirmed it will no longer be selling through eBay and has no running listings left on the marketplace. In addition, PWCC said its Premier Auctions will remain active as they take place on the PWCC platform.
PWCC had been working on expanding its online platform because it felt that it was increasingly competing with eBay’s refocus on trading cards. “Today’s unilateral action by eBay simply hastens PWCC’s move to its new platform. The new platform will be live on the PWCC website very soon,” PWCC explained.
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