Auction House Conflict of Interest

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Posted By: Aaron M.

Barry, rather than being an independent contractor working for Sotheby's on a one-time only basis, imagine you were a full-time employee of Mastro's and your financial well-being was dependent on their performance.

Now imagine you were head of consignments for a particular region. Now imagine in your opinion consignments that you had secured from high-profile collectors were underperforming in your auction.

You begin to wonder if you will be able to continue to get consignments from those high-profile collectors. You wonder if those high-profile collectors are influential enough to warn their fellow high-profile collectors against consigning to you.

The flip-side is you know if these items sell for strong prices those high-profile collectors have even more valuable items they might consign to you. And so do their high-profile collectors friends who they might recommend to you.

All you need to do is confidentially feign interest in those items and enter some bids and you are in a better position financially as a Mastro employee.

Is what I wrote that implausible?