Ebay and other auction services prohibit the practice of shill bidding. Shill bidding, is a criminal offense – which is a type of auction fraud. Our NYC Criminal Defense Lawyers can help those who are accused of committing auction fraud. We have over 50 years of combined experience, handling criminal cases of all complexities, and ca help.
Shill bidding refers to the practice of placing bids on auction items in order to drive up the price of an item. The scam begins when a seller lists an item, and beings accepting bids. The seller uses aliases, families, friends, etc, to bid on the item – in an attempt to increase the price. The price of the item goes higher. It makes it so any legitimate buyer is forced to buy the item at a higher price. It’s a form of manipulation, and a form of auction fraud. The seller in an auction makes more money than the fair market value of the item. In some cases, seller use shill bidding as part of a larger fraud scheme. Many of these schemes involve counterfeit goods, or legitimate valuable items.
Penny auctions are another form of shill bidding. Penny auctions allow internet users to buy bids on items – which appear to be priced very low. Each bid costs money. When a buyer pays for a bid, and then makes a low bid, the other participants in the penny auction scam will enter false bids in order to continue driving the price of the item higher. Often, the legitimate bidder loses his investment which was made to buy the bids. If the bidder doesn’t win auction, then he loses all of his money. If the bidder wins the auction, then the bidder does so by paying more money than the item was worth.
Penalties for shill bidding can be intense. It all depends upon the level of atrocities in the scam. This can result in state, or federal, criminal charges. If platforms like eBay are used in the shill bidding process, then the penalties become severe. If the crime involves counterfeit goods, the penalties are more severe. Shill bidding is prosecuted under the Donnelly Act. The act, is an antitrust law – which prohibits bid rigging and price fixing in any situation. It’s used to prosecute people accused of shill bidding in the online auctions. If you’re charged, you can get a 4 year prison sentence, a fine of $100,000 and $1 million for businesses.
If the shill bidding involved wire fraud, it can also result in 2 decades of imprisonment. If you’re accused of shill bidding, it’s crucial you hire our attorneys. It’s imperative you prepare yourself for state and federal offenses, which can you send to prison – and leave you with a felony on your record. Our New York auction fraud lawyers can help you get the justice you deserve.