Shill Bidding: What It Is and Why It's Not Permitted on eBay

Shill bidding undermines trust in our community and is not permitted on eBay. In addition, shill bidding is considered a felony with severe consequences. We want to ensure that all eBay users understand what shill bidding is, why eBay treats it so seriously, what can happen if one engages in shill bidding, and ensure that members do not unknowingly engage in the practice.

What is shill bidding?
Can friends bid on my item?
What's wrong with shill bidding?
Can I get in trouble for shill bidding?
What is eBay doing about shill bidding?
Why are some reports not acted upon?
eBay appears to benefit from shill bidding.
Privacy enhancements prevent shill bidding detection.
How does bid history and bidder search help?
If I report someone for shill bidding, will they be suspended?
I bid on one sellers items, am I shill bidding?
Why isn't a seller suspended permanently for shill bidding?
What happens if the seller shill bids again after the temporary suspension?
Can a permanently suspended member set up new accounts?
Is a seller allowed to have more than one registered eBay account?

Q. What is shill bidding?
A. Shill bidding occurs whenever a seller places a bid on their own item, either directly or through others. An eBay seller is never allowed, under any circumstances, to place a bid on their own item. To avoid even the appearance of this activity, family members and individuals living together, working together or sharing a computer, may not bid on each other's items.

Q. Can friends bid on my item?
A. If your friend sincerely intends to purchase your item, then bids are certainly allowed. If a friend contacts you and expresses interest in your item, encourage them to register. Don't jeopardize your own good standing with eBay by bidding on the item on their behalf.

Q. What's wrong with shill bidding?
A. By placing an item on eBay, you are letting the world decide the true value of what you're selling. But if you are bidding on the item yourself, you may be driving up the price of the item artificially, and possibly encouraging buyers to pay more than the true market price. Since shill bidding involves using a separate User ID, you're creating the false impression that another bidder is interested in the item and willing to pay more for it. This undermines trust in our community and will not be tolerated.

Q. Can I get in trouble for shill bidding?
A. Yes. This practice is not permitted per eBay's User Agreement and in most cases it will result in a 30-day suspension on the first offence. Subsequent violations will result in an indefinite suspension. A number of sellers have already lost their selling privileges and greatly hurt their own business by engaging in shill bidding. Even worse, shill bidding may be an offence under the New South Wales Crimes Act 1900, section 178BB or under the Crimes Acts of other Australian States and Territories. eBay will cooperate fully with any law enforcement inquiry into shill bidding on eBay.

Q. What is eBay doing about shill bidding?
A. eBay itself developed the industry's first shill bidding detection tool in early 1999 as a way to analyse bidding patterns over multiple listings. We've learned more about shill bidding detection over the last year and we've put that knowledge into the next generation shill bidding detection tool that was recently implemented. This tool analyses completed listings, so it is somewhat reactive. It is, however, effective. Moreover, we have already started building tools that will assist us in being proactive in detecting ongoing shill bidding and plan to launch these later in the year. We encourage you to report suspected violations to us so that we can investigate further. The few who engage in shill bidding undermine the integrity of the entire trading community. Their behaviour will not be tolerated.

Q. Why are some reports of shill bidding not acted upon? Why are reported shill bidders allowed to continue to do business on eBay?
A. Shill bidding reports received by the Trust & Safety team are investigated thoroughly. Sometimes, what appears to be a shill bidding may actually be legitimate bidding activity. This can occur for a number of reasons, for example, a bidder may bid almost exclusively on one or two sellers whom they have come to trust.

Q. eBay appears to benefit from shill bidding so why does it care?
A. This violation creates a barrier to success since bidders hesitate to bid if they suspect shill bidding. This leads to decreased bidding, decreased seller success, and, ultimately, decreased success for eBay. Furthermore, it is unfair to our treasured community. Thus, it is in the best interest of eBay and its community to prevent shill bidding.

Q. Changes to enhance privacy prevent me from detecting potential shill bidding since I cannot easily see email addresses. How do I manage this?
A. The changes related to privacy, including limiting the visibility of email addresses, are essential to address a number of issues, e.g., spam, bid siphoning, and fee avoidance. Although this will eliminate one community avenue for shill bidding detection, we believe that this is the right move as we have implemented internal tools along with enhancements to Bid History and Bidder Search to effectively address the concern.

Q. How exactly does Bid History and Bidder Search help?
A. The Bid History page provides a moment-by-moment view of the bidding and possible retractions that take place in a transaction. This allows visibility to bidding patterns. Patterns that suggest no advantage to the bidder but significantly increase the bidding price of the listing may suggest shill bidding. Questionable patterns include multiple bids by a bidder in short, deliberate intervals and bidding several times in small amounts even if not having been outbid.

Sample Scenarios:
1. A member bids several times just under the highest bidder towards the end of a listing, incrementing the final sale price by a dollar and retracting if he/she inadvertently bids more than the high bidder.

2. A member bidding 30 times or more even when there are no other bidders on the listing (an attempt to create a Hot item).

The Bidder Search page allows you to view the Sellers of the items that a member has bid on. Sorting this list by the Seller ID allows unusual patterns to be seen, for example, a member who bids exclusively on a certain seller's items. Of course, there are cases where it may be valid for a bidder to buy frequently from a particular seller. However, this is the exception and the Trust & Safety team will be able to rule this out after analysing the trading patterns using internal tools.

Q. If I report someone for shill bidding, will they be suspended?
A. It depends on the situation. Many factors will be considered when determining whether shill bidding has occurred. These factors are carefully examined. In the end, only bidders determined to be shills (based on the evidence) are suspended.

Q. I only bid on items listed by one specific seller; will I be considered a shill bidder?
A. In some cases, placing bids in only one seller's listings might raise suspicions about whether or not you are a shill bidder. However, bidding on only one seller's listings is not the sole factor that eBay would use to make a determination about the possibility of shill bidding.

Q. Why isn't a seller suspended permanently the first time shill bidding is discovered?
A. eBay recognises that some people might not understand that shill bidding is wrong and believes in educating members and providing them with a second chance. This is why a temporary suspension is made. A temporary suspension is serious, and sellers take it as such.

Q. What happens if the seller shill bids again after the temporary suspension?
A. If the shill bidding continues at any time after the temporary suspension has ended, the shill bidder will be suspended from eBay indefinitely.

Q. What happens if the seller sets up new accounts after the other accounts are suspended?
A. Use of secondary registrations (new accounts) to avoid suspensions is cause for indefinite suspension of all participating registrants.

Q. Is a seller allowed to have more than one registered eBay account?
A. Yes, a seller is permitted more than one eBay registration as long as their reasons are legitimate. However, there should never be any interaction (especially in the areas of bidding or feedback) between the accounts, and all user information MUST be accurate and consistent.