Quote:
Originally Posted by Exhibitman
How reserves may be used is a function of state law. Auctioneers located in states with less regulation are freer to do more hidden manipulation of an auction. You don't care for a particular auctioneer's policy, bitch to the state legislature.
All of the machinations have one goal: to generate 'action'. If the auction started at the reserve, there would be less action. The more bidders in an auction on an item, the more buzz it gets, the more likely others are to bid on the item. FOMO.
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Point well taken. These practices are permitted because state and local legislatures permit them. NYC has gone even further off the deep end --
https://www.huntonak.com/hunton-reta...rning-auctions
I don't know if it is because of increased state and local tax revenue these legislatures feel they will generate, or the prestige of attracting AHs to their venues, or to threats by AHs to leave venues unless certain rules are enacted, or a combination of the above, but it sickens me these practices are allowed. It is nothing less than legalized shill bidding, rationalized under the pretext that as long as the AH discloses to you (in the fine print) that they are trying to defraud you, the governing jurisdiction will not treat it as fraud even when the AH pulls it off.
I'd love to see the day some defendant in a civil suit brought against him/her for fraud raises the defense that since the plaintiff knew the defendant had a reputation as a fraudster, the plaintiff was put on notice shenanigans would take place and thereby as a matter of law no fraud could have occurred.