EcommerceBytes-NewsFlash, Number 1291 - May 31, 2006     1 of 5

Company Offers ''Illegal'' eBay Shill-Bidding Service

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A company is offering eBay sellers in Germany a shill-bidding service to help them increase their final auction prices. XXLsell.com got some attention in Germany last November, including this German-language post on the AT-Mix.de website (http://www.at-mix.de/news/1317.html).

Sellers can join XXLsell, and, after submitting their eBay user names and passwords, they can give XXLsell orders to shill bid on their auctions up to a set price. Shill bidding is when sellers bid on their own items to attract bidders and achieve higher selling prices, and is against eBay's policy. The most notorious case of shill bidding on eBay involved a ring of U.S. sellers who committed art fraud for which three of the participants were prosecuted. XXLsell appears to be the first commercial company offering shill-bidding services.

According to the eBay seller in Germany who brought the site to the attention of AuctionBytes, there are two different fees for using XXLsell. "If you allow XXLsell to use your eBay account for shilling on other auctions, then you have to pay a 2 percent provision on each shilling. If you don't want your eBay account being used for that shilling, you have to pay twice as much, 4 percent." He said he was skeptical of the site and said XXLsell is located outside of Germany (the domain name is registered to a user in the Dominican Republic).

eBay spokesperson Catherine England stated in an email, "We are aware of the service and its use is against eBay policy (it's also illegal). Since the site is in German, we have sent notices to our German members cautioning them against using this service." England also said it is "never a good idea" to use a service that requires users to reveal their user names and passwords.

XXLsell states on its site that it has 13,748 members and 1100 Powersellers. According to the source, if a member's account wins an auction through a shill bid placed by the service, the buyer is not obliged to buy, and the seller is not obliged to sell. However, the seller has to pay the fees - both the XXLsell fees and the eBay fees.


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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