How to Detect Shill Bidding
On online auction sites such as eBay, shill bidding is a practice in which someone bids on an auction in order to inflate its price. It could be a friend or family member of a seller or occasionally, the seller himself under a different user name. This is an unethical practice that auction sites discourage. If you believe that a bidder you're competing against in an auction may be shill bidding, there are signs you can look for to determine whether your suspicions may be correct.
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Instructions
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Examine the feedback rating of the competing bidder. Many shill bidders have little to no feedback because they generally don't follow through with purchasing items they've bid on. This alone is not a sure sign of a shill bidder; he may just be a legitimate new user.
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Look at the person's bidding activity. When you look at the list of bids on a specific auction, the other bidders' user names are concealed with asterisks. However, you can still click on a name to check the person's bidding history over the last 30 days. Click on the suspected shill bidder's name to see how many of the same seller's auctions he has bid on. If he has a strong history of bidding on items from only one seller and never winning, that may be a red flag.
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Check for bid retractions. A legitimate buyer should have very few, if any, bid retractions. Retractions are only supposed to be used under a strict set of circumstances, such as when a bidder accidentally bids $250 instead of $25. In the case of a shill bidder, he may retract a bid if the auction is about to end and he is still the high bidder, which leads to a higher than normal number of retractions. The number of retractions a bidder has made in both the last 30 days and six months can be found on the same page as his bidding activity.
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References
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