the list (of criminals) is revealed

[ezez420]

Removed

[bnorth]

Originally Posted by ezez420

Removed

You should have left that Ed. I got a good laugh. GOD BLESS

[TheNightmanCometh]

I keep noticing it A LOT. How many of you guys are lawyers?

[Mark17]

Having read through this thread with interest, I've decided it's time for me to invite some abuse onto myself by offering my opinions (because I'm sure many will disagree... and I do understand the other side to this.)

First, the list of names doesn't give the nature of the shilling, and that is absolutely critical to determine what actually happened. There are degrees of seriousness here that are quite dramatic, depending on the type of shill bidding that occurred.

Consider these scenarios:
1. A collector is considering consigning some items to an AH, but is of course concerned that the items might end up selling at an unacceptably low price. So, the seller tells the AH that he'd be interested in offering his items, but he'd need to get certain minimum amounts, after shipping fees, consignment fees, authentication fees, and so on. The AH tells him they understand and will make sure he gets acceptable amounts for his stuff, or it'll be returned to him unsold. The consignor agrees, not knowing, caring, or having it even occur to him to ask, what mechanism the AH will use to establish those minimum price levels.

That mechanism could be a reserve, a hidden reserve, an in-house base initial (shill) bid, a bid from an active collector who would in fact like to purchase the item if he could get a great deal on it, and is perhaps considering placing larger bids later on to try to acquire the item, and so on. Bottom line: the consignor may not know which of the above methods will be used to protect his items. He may assume a generally accepted method will be employed - like a hidden reserve, but it might turn out the AH uses a method involving a shill bidder, without the consignor being aware of it.

In this scenario you might see a seller listing multiple items that all employed the same shill bidder... but the consignor was unaware anything wrong was taking place.

2. I'm sure most will disagree with me, but when I am bidding on an item incrementally, it doesn't really matter to me whether I'm going up against a real bidder, a shill bidder, or trying to reach a hidden reserve. I know what an item is worth to me, and I bid accordingly. We aren't talking about putting food on our families' tables here, we're talking about bits of cardboard, pieces of wood (bats) and pieces of old cloth (jerseys.) Sometimes these items also have ink (autographs) on them. If I don't win an item I'd like to add to my collection, I deal with it and it isn't that hard to do. If I pay more than I should, that's on me and I'll remind myself to be more disciplined next time.

I understand that when shill bidders end up being the high bidder and give the impression an item actually sold at an inflated price, it sends a false value to the marketplace. But that also happens when two legit bidders go toe-to-toe bidding on something they both need for their specific collections.

For instance, I recently paid over $2,200 for a 1964 Jim Kaat 1964 flannel. A few years ago, I know someone who paid over $4,000 for a 1962 Twins common shirt. He was very unlucky in that he ran up against someone else who really wanted it badly (I seriously doubt that was a shill situation... no shill bidder in their right mind would've dreamed they could've pushed the price to that level.)

So... did the $4,000 sale tell the market that a Twins common shirt is worth that much? No, I don't think so but in any case that specific price anomaly happened in the marketplace, and that general scenario takes place regularly, naturally, without shill bidders involved.

3. The third type of shill bidding is way, way different. That's when an AH exploits bidders' maximum bids. I do not know if any of the instances on that spreadsheet are of this variety, but to me, IF an AH accessed max bids and then used that info against the bidder, to pump up their bids, that would be, or should be, outright criminal.

Most AH have rules stating that bids are considered legal contracts, and placing a bid thus obligates the bidder to pay for items won. So, suppose an AH sees that a bid is standing at $1,000 but the high bidder has a max bid of $2,500. They could, in theory, use shill bidders to push that up artificially to the max bid, and then require the bidder to pay the inflated price. To me, that's basically theft.

I do not know if any of the instances on that list are of this type. I'm just saying... IF any of them were, then that would be very, very serious.

So, in sum:
1. If a consignor doesn't know shill bidders are being used to protect his listings, I see no guilt on his part, and minimal guilt on the part of the AH. Using reserves would be a better, more transparent, method.

2. If shill bidders are being used during incremental bidding, I understand it's wrong, but if I'm the victim, I'm not too bothered by it. Would I like to get the item cheaper? Of course. But ultimately I need to be disciplined and only pay as much as I want to pay for something. And when the plan backfires on the shill bidder, and they end up eating the consignment fees, buyers premiums, and so on, well, that's justice.

3. If an AH uses maximum bids submitted by bidders to drive up the actual bid, this is, or should be, outright criminal and people should go to jail or be fined. The fallout, as this scandal unfolds, could be that bidders may be reluctant to place max bids if they don't have complete confidence in the AH, and this could really drive down realized prices, especially for those auctions that extend well into the early morning hours.

So, my personal opinion is basically that a list of names without knowing who actually did what, is not sufficient to assume everyone on the list is "guilty," and it certainly is not enough to determine who (if anyone) might be "really, really guilty."

[ElCabron]

Mark17,

Have you ever been a shill bidder or had an auction house or other person place bids on your consignments?

-Ryan

[Mark17]

I wondered if it would be possible to express an opinion here without being personally attacked........... guess not.

The answers are "no." I don't beat my wife either (only because I'm not married.)

[ALR-bishop]

Well, would you..if you had one ?

[Runscott]

Originally Posted by Mark17

I wondered if it would be possible to express an opinion here without being personally attacked........... guess not.

You have to expect it. The tough part is not lashing out when it happens.

[ElCabron]

Originally Posted by Mark17

I wondered if it would be possible to express an opinion here without being personally attacked........... guess not.

The answers are "no." I don't beat my wife either (only because I'm not married.)

I'm not sure why you took that question as a personal attack because I think it's a fair question to ask. I am not at all interested in hearing what shill bidders think about any of this. I think a lot of people who are not on the list have not chimed in at all due to the fact that they, too, have shilled items, either in Mastro during the years the records were destroyed, or with other auction houses. There are far more offenders than what appears on that list.

Keep in mind, that list is just 2 years from just one auction house. There are probably quite a few board members who have shill bidding skeletons in their closets and are hoping everyone would just drop this issue and move on to funner things.

I disagree with most of what you say in points 1 and 2 and I don't understand why so many people are coming to the defense of the people named on the list when they are perfectly capable of doing that themselves. If you think there are examples where something on the list might have looked like shill bidding, but was not, please let us know. Perhaps there are answers to those questions. If someone has been incorrectly added to that list, let us know. Or at least let us know why they can't come here and question it on their own.

But your point about there being different degrees is valid. Is Peter S. the same as Doug Allen? No way. Not even in the same ballpark. That's why he's not going to jail. But he's still a shill bidder. There are some examples of multiple offenders that were undeniably involved in shill bidding, though. Are you really suggesting that JC Clarke, or Kevin Keating, or Dave Forman shouldn't be on the list?

I would have thought that anyone who looked at the list or knew anything about Doug Allen would be able to easily put into perspective the differing levels of criminals that made the list.

Doug Allen > JC Clarke > Peter Spaeth



-Ryan