The Problem of Shill Bidding in the Domain Industry

You may have heard the story of Adam Dicker (veteran domainer) when he was accused of shill bidding during his employment with GoDaddy. And then, there was the class action lawsuit against SnapNames.com where a former employee was claimed to have bid against potential customers on thousands of domain auctions. These are some serious charges and stories like these shine a bad light on the industry as a whole.

I assume shill bidding happens more often than we may know about because, quite frankly it’s difficult to catch. There’s been plenty of rumors about shill bidding at eBay domain auctions. I also have my doubts that GoDaddy, Sedo, and Flippa auctions are 100% legit. When you see so many mediocre domains and websites sell for so much money, you start to wonder.

Is shill bidding infiltrating domain forums?

I’ve been a long time member of NamePros. Recently, I have been noticing some unusual bidding from new members. I think they could have gotten away with it, were it not for their ridiculously out of control bidding. As experienced members of forums, we typically know how the bidding war goes… it goes back and forth in small increments. So, when you see an unknown member bidding in $15 or $20 dollar increments in a low-level auction where the minimum bid increment is set to $1, it’s a bit suspicious.

Here is the URL to the thread in question: https://www.namepros.com/threads/vauq-com-4-letter-pronounceable.833159/

Screenshots:

NamePros thread screenshot 1

NamePros thread screenshot 1

NamePros Shill Bidder

NamePros Shill Bidder

NamePros thread screenshot 3

NamePros thread screenshot 4

In the final post of the thread, a moderator suspends the thread due to unusual activity and initiates an investigation. It also appears that they suspended the accounts of the culprits that seem to have been involved in the shill bidding.

Note: These are screenshots of only the suspected shill bidders. There were several innocent bystanders that took part in the auction prior to the final bid.

With that said, I believe NamePros is the best domain forum around and the moderators there do a great job of maintaining the forum.

We know the problem exists, but is there a viable solution or do we just accept that it’s an ugly part of the business and move on?

Update: I just found an eBay auction by the same scammer(s) selling the same domain. Here: http://www.ebay.com/itm/vauq-COM-LLLL-com-4-letter-domain-at-GoDaddy-com-pronounceable-hard-to-find-/261597963505?pt=Domain_Names&hash=item3ce87424f1

4 thoughts on “The Problem of Shill Bidding in the Domain Industry”

  1. SHILL BIDDING IS LEGAL, IT’S CORRECT, HAVE TO BE LEGALIZED.
    If you don’t want to buy, you don’t buy. No one is forcing you. Someone is forcing the price, not you. You will not buy, well, the problem is your, they will not take your money. Period. Be honest with yourself: you want the deeal, the gift, and simply you don’t want techniques able to raise the price to a market price. When the market is still in its infancy, you have to help it to raise. That is the truth. Period. It is a way to help the creation of a real market, nothing more. If you don’t want to buy, you don’t buy. there are fake customers everywhere in the world. Or you don’t see all the shill sales, shill prospect customers and shill happy customers in the offline world, or instance?!?

    1. Shill bidding is simply wrong. It’s not a real market if you are placing fake bids and inflating the numbers.

      Also, just because these scams happen all the time, doesn’t make it OK to do. It’s either you stand up for what is right, or you can choose to do shady things to make money.

  2. The real problems are others:

    1) everyone have to be free to do shill bidding
    2) everyone have to be free to start auctions of any type for doamins in any TLD, without discriminatins that are against the Declaration of the Rights of Man and of the Citizen (Men are born and remain free and equal in rights”.

    Let everyone to be free, not only the ones in the little circle ot head guys, and you will have soon a real market, the best thing for all

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