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EcommerceBytes-NewsFlash, Number 2768 - March 26, 2012 - ISSN 1539-5065    4 of 4

BidBay Founder Sentenced to Prison

By Ina Steiner
EcommerceBytes.com
March 26, 2012




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The founder of BidBay.com, an auction site that competed with eBay from 2000 - 2001, was sentenced to nearly three years in federal prison after pleading guilty to charges related to an investment scheme involving the company, according to reports. "George Tannous pleaded guilty in 2008 to charges of conspiracy and filing a false tax return for his role in a scheme that defrauded hundreds of investors in Bidbay.com, which was developing an online auction website," wrote the LA Times.

According to the Associated Press, a jury in 2005 found George Tannous and his partner, former Rep. Wes Cooley, had lied in 2000 when they said online-auction giant eBay.com was about to buy their BidBay.com. The two were ordered to pay $2.2 million to 11 St. Louis-area investors.

In fact, eBay forced BidBay to change its name by suing it for trademark infringement. BidBay became AuctionDiner, then Bidway.com, and launched another service called Multi Level Auctions (MLA).

Cnet recounted the tale of BidBay in this 2006 report.

According to Businessweek, Tannous had received nearly $3 million in investor funds in 2001 but didn't report the proceeds to the IRS, according to authorities.

About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

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