 EBay shill bidder fined £3,500
A man has been fined £3,500 and ordered to undertake 250 hours of community service after bidding on items he had listed for sale on eBay to drive up the price. It was the first prosecution in the UK for the practice known as shill bidding.
Paul Barrett, 39, increased the price of the items he was selling on the auction site by bidding on them under a separate username. In April he pleaded guilty to 11 charges under consumer protection laws. He was sentenced at Bradford Crown Court yesterday.
North Yorkshire trading standards officers began investigating Barrett after receiving a complaint about a minibus advertised on eBay. Barrett claimed the vehicle had covered just over 55,000 miles but once the complainant had bought the minibus he found it had done over 132,000 miles.
Trading standards officers obtained Barrett's eBay records and discovered he had used two usernames to increase the bidding on items he was listing. As well as the minibus his listings included a pie and pasty warmer, a cash register, refrigerated display counter, two mobile phones, a Land Rover and a Mercedes car.
Barrett's offences were prosecuted under the Business Protection from Misleading Marketing Regulations, because some transactions were business to business sales, and the Consumer Protection from Unfair Trading Regulations, because some transactions were business to consumer sales.
The Business Protection from Misleading Marketing Regulations 2008 prohibit any advert that "in any way, including its presentation, deceives or is likely to deceive the traders to whom it is addressed or whom it reaches; and by reason of its deceptive nature, is likely to affect their economic behaviour". The regulations include "the price or manner in which the price is calculated" as factors in determining whether an ad is misleading.
The Consumer Protection from Unfair Trading Regulations 2008 prohibit unfair commercial practices, including misleading actions and omissions. They also ban the practice of "Falsely claiming or creating the impression that the trader is not acting for purposes relating to his trade, business, craft or profession, or falsely representing oneself as a consumer."
Both sets of Regulations provide for a maximum sentence of an unlimited fine and up to two years' imprisonment for each offence.
Shill bidding could also be prosecuted under the Fraud Act in England, Wales and Northern Ireland, which includes an offence of dishonestly making a false representation with the intent to make a gain or to cause loss to another. The maximum penalty under that law is 10 years in prison and an unlimited fine. In Scotland it could be prosecuted as common law fraud, which is committed when someone achieves a practical result by a false pretence.
County Councillor Clare Wood, North Yorkshire's Executive Member for Trading Standards said: "This case should be a stark warning to people using eBay and other auction sites that if they shill bid or encourage family and friends to place ⊗⊗⊗⊗ bids to push up prices artificially, they too face prosecution."
*From media reports APRIL---JULY 2010* | 
