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Old 02-09-2013, 12:38 PM
BobC BobC is offline
Bob C.
 
Join Date: Apr 2009
Location: Ohio
Posts: 3,276
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Going back to the OPs initial comments, it seems he was suggesting that AHs are possibly more prone/prevelant to have shilling and other improper activities occur in regards to their auctions than Ebay, be it the AHs themselves, or their consignors, responsible for the deemed illicit activities.

Others have pointed out that it is improper, and just not good business sense, for the AHs to be completely open in providing personal data on bidders and contacts they have, which is true. There is a possible solution that could be employed by AHs to impart a greater sense of responsibility in how they conduct their businesses and to show to bidders that they actively attempt to discourage and guard against shilling and other improper auction actions, and thereby instill greater trust amongst those who would use them.

The accounting profession for a couple decades has sanctioned a specialized type of audit that CPAs can perform to test internal controls and procedures of services organizations, specifically on the work/services they provide to their customers. It was originally supposed to be only when the customer was having an audit done on their own books but, after the likes of Enron and Bernie Madoff, people/companies began asking for these types of audit reports more often just to make sure they weren't getting screwed. The accounting profession just in the last couple years changed this specialized reporting and call it a SOC (pronounced - sock) report. Stands for Service Organization Control reports. An AH could hire a CPA/accounting firm to come in, review their controls and procedures around their auction/biddng process and see what they're doing to prevent/discourage shill bidding and other disreputable practices that people have concerns about. The CPA/auditor could then issue a report and describe the internal controls/procedures in place, actually run tests to see the controls/procedures are functioning as expected, and report on the same. The AH could then provide this report to users of their service to document what they are doing to prevent disreputable activities, without disclosing private information concerning bidders and business practices. The CPA/auditor is a licensed professional subject to confidentiality/ethics rules, and would not be able to disclose such private info and must maintain impartiality and independence with respect to the AH being audited.

Would not necessarily stop or always detect collusive activities or consignors from trying tricks but, at elast you would have an idea what the AH was doing to prevent such problems, and whether they were doing enough in your own opinion. It is a lot more believable than just hearing an AH say they are doing everything they can to prevent disreputable activities in regards to their auctions.

Bob C
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