Auctioneers Bidding-Up Absentee Bids?

[Coinery 926]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

[azda 973]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I believe this practise does occur

[VickySilver 775]

Yes, and to name names I believe Stack's in New York City has and does do this. Anybody else brave enough to "out" anybody. I even have my suspicions about Heritage as well.

[azda 973]

Judging by stacks prices, i'd go with that

[Nick 325]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I'm sure that we can all believe that this sort of fraud occurs, but proving it is another matter. Ghost bids from the floor are risky for an auction house as it's possible for a sharp-eyed spectator to see that there was no actual bidder. I suspect that auction houses wishing to maximise their profits would prefer to invent absentee underbidders or to employ shill bidders in the audience.

[VickySilver 775]

Before this gets dismissed as anecdotal, experience with a particular house (W&W anybody - LOL!!) might generate a bit of circumstantial evidence in that if all winning bids are mysteriously at the maximum over a 20 year span that perhaps, just perhaps, there is a bit of funny business going on...

[Gary D 76]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I'm sure that we can all believe that this sort of fraud occurs, but proving it is another matter. Ghost bids from the floor are risky for an auction house as it's possible for a sharp-eyed spectator to see that there was no actual bidder. I suspect that auction houses wishing to maximise their profits would prefer to invent absentee underbidders or to employ shill bidders in the audience.

I know the only time I even bought a coin from Torex I happened to get it for my maximum bid to the penny, lucky what. The time I lost a coin again at Torex I was the under bidder to someone on the floor who got the coin for the same bid as me.

[Accumulator 52]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I'm sure that we can all believe that this sort of fraud occurs, but proving it is another matter. Ghost bids from the floor are risky for an auction house as it's possible for a sharp-eyed spectator to see that there was no actual bidder. I suspect that auction houses wishing to maximise their profits would prefer to invent absentee underbidders or to employ shill bidders in the audience.

I know the only time I even bought a coin from Torex I happened to get it for my maximum bid to the penny, lucky what. The time I lost a coin again at Torex I was the under bidder to someone on the floor who got the coin for the same bid as me.

That's almost exactly what happened to me with another auction house. I left proxy bids on two lots. The first won, but at my maximum (funny that, I thought) the second lost to a bidder in the room, also at my maximum. Apparently room bidders take precedence despite my bid being the first (having been submitted several days before).

[Nick 325]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I'm sure that we can all believe that this sort of fraud occurs, but proving it is another matter. Ghost bids from the floor are risky for an auction house as it's possible for a sharp-eyed spectator to see that there was no actual bidder. I suspect that auction houses wishing to maximise their profits would prefer to invent absentee underbidders or to employ shill bidders in the audience.

I know the only time I even bought a coin from Torex I happened to get it for my maximum bid to the penny, lucky what. The time I lost a coin again at Torex I was the under bidder to someone on the floor who got the coin for the same bid as me.

That's almost exactly what happened to me with another auction house. I left proxy bids on two lots. The first won, but at my maximum (funny that, I thought) the second lost to a bidder in the room, also at my maximum. Apparently room bidders take precedence despite my bid being the first (having been submitted several days before).

Room bids don't always take precedence. You can win or lose at the same maximum bid. It's pure luck and depends where the bidding starts and on the bid increment. Imagine that the bid increment is £10 and your maximum proxy bid is £100.

Scenario 1: Starts at £80, room bid £90, your bid £100 => you win assuming nobody wishes to bid higher

Scenario 2: Starts at £70, room bid £80, your bid £90, room bid £100 => you lose as £100 is your maximum

[argentumandcoins 70]

It makes sense for room bids to take precedence as the house is paid and gets the goods cleared on the day, BUT, it would take an exceptionally clever auctioneeer to know what point to start taking the bidding against the book to ensure the room wins the lot at the top book price.

The practice that really "boils my urine" is the frightfiully nice chap on the rostrum saying "one more might get it" to the room. He is supposed to act on behalf of the proxy bidder and obtain the lot at the lowest possible price for them (it is in all of their T&C's)

[Peter 615]

My pal is a fine art auctioneer.Loosen his toungue with a couple of pints....and yes it is a can of worms.Lovejoy is one of the more honest types.

[Accumulator 52]

Hi all,

Am I just being paranoid here, but does anyone have any insider information that could shed any light into whether the practice of bidding-up absentee bids is common practice?

I just wonder about this because if an auctioneer has an absentee bid of £500 in his hand, and a top floor bid of say £350, would it not be an easy thing to put in a ghost bid from the floor to drive up the amount charged to the absentee bid? After all, this is where the auction company makes its money.

Bidding up an absentee bid would be a win, win, situation...any thoughts?

Many thanks for the expertise,

Stuart

I'm sure that we can all believe that this sort of fraud occurs, but proving it is another matter. Ghost bids from the floor are risky for an auction house as it's possible for a sharp-eyed spectator to see that there was no actual bidder. I suspect that auction houses wishing to maximise their profits would prefer to invent absentee underbidders or to employ shill bidders in the audience.

I know the only time I even bought a coin from Torex I happened to get it for my maximum bid to the penny, lucky what. The time I lost a coin again at Torex I was the under bidder to someone on the floor who got the coin for the same bid as me.

That's almost exactly what happened to me with another auction house. I left proxy bids on two lots. The first won, but at my maximum (funny that, I thought) the second lost to a bidder in the room, also at my maximum. Apparently room bidders take precedence despite my bid being the first (having been submitted several days before).

Room bids don't always take precedence. You can win or lose at the same maximum bid. It's pure luck and depends where the bidding starts and on the bid increment. Imagine that the bid increment is £10 and your maximum proxy bid is £100.

Scenario 1: Starts at £80, room bid £90, your bid £100 => you win assuming nobody wishes to bid higher

Scenario 2: Starts at £70, room bid £80, your bid £90, room bid £100 => you lose as £100 is your maximum

I take your point Nick, but when I questioned the result the auction house referred me to their terms of sale which stated categorically that if two equal bids were received then the one in the room always took precedence, not the earliest received, which would have seemed fair.

Edited November 23, 2011 by Accumulator

[Coinery 926]

I'm staggered yet grateful to read the findings, absolutely the reality no doubt! It seems to me that the only way forward is to be there on the day, which is impractical for most of us middle-of-the-road traders and collectors, it is an 'all or nothing' adventure it seems! Human nature! Good practice for the seller, though!

[Rob 3,002]

Yes, and to name names I believe Stack's in New York City has and does do this. Anybody else brave enough to "out" anybody. I even have my suspicions about Heritage as well.

I believe I should agree with the first as I have been made aware of an instance where this was witnessed and the info passed to the winning bidder (needless to say the hammer was at the max). Heritage I am not sure about as I have won things below my maximum on most occasions. I have never won a lot at Noble below my maximum; something that has happened to others as well.

[numismatist 2]

Vickysilver mentions ( W&W ) I no longer bid there, as every item I've ever won was at my maximum bid. Must admit that at Bonhams , DNW ,Morton and Eden and Spinks, I've quite regularly won items at well below my maximum bid, which gives me a bit of hope with those ones. I know that many local auctioneers who have coins only now and again,as a general rule start at the maximum bid so you have to be VERY careful with some.

[Fubar 71]

I do some work portering at our local auction house.

When we take bids left by viewers on viewing days or the office takes bids over the phone then the time and date are always noted. The earlier gets precedent. If several bids are left on the same lot then the auctioneer is allowed to start at the amount left by the underbidder. If two bidders have left the same amount then the auctioneer will use the earlier timed one to carry on from the underbidder's price.

The rules governing "bids against the wall" or "bidding up" an item are quite clear and the maximum number of "false" bids the auctioneer may use are regulated. This should only be used in order to get a lot started or if the first bid is too low.

Reserves are never published to buyers so no-one should know what the minimum acceptable selling price is. The auctioneer is allowed to work it up to reserve price if he thinks there is interest in the room. Most can tell straight away if something is going to reach the reserve or not.

Selling to house is another allowable practice if the price is too low.

It must not be forgotten that the auction house has a prime responsibility to the vendor to get the best price available. Most vendors have an inflated idea of what price an item will achieve at auction. We regularly warn people that something will not sell or will not reach the figure they are expecting. Most valuations for auction are at most 50% of retail value or less. I'm currently valuing and lotting a library of very expensive specialist books and I'm having to estimate lot value at about 25% of retail value because of the current depression in the book market. Kindle is largely to blame.

Coins are slightly different in that a fair estimate is put on such things as silver and gold coins and they invariably reach or exceed valuation at present.

The number of bids recently by people who cannot pay or will not pay is increasing. Most auction houses do not require proof of an ability to pay prior to bidding although some do ask for a deposit for the buyer's number issued. The only thing the auction house can do is re-offer the items at the next auction.

Apart from working as a porter I've been attending, and bidding at, auctions for coming up for 35 years. Which is why our house is so full of junk.

I've always found that I'd rather be there than leave a bid but even after such a long time I can still get a bit carried away. If I'm not working an auction now I tend to leave a bid with a fellow porter knowing he won't go mad on my behalf.

Kris

[azda 973]

Well there we have it, shill bidding is allowed

[Peter 615]

Human nature, money and greed are the perfect incredients for a bit of

[azda 973]

Human nature, money and greed are the perfect incredients for a bit of

More money equals more profit equals shill bidding equals greed.

Why is it only auction houses and Martin Platt get book prices or more for coins.

Any auctions i watch on fleabay are always wayyyyyy under book prices for rarer or decent graded coins (i can hear John Stephenson now when i say BOOK PRICES) but auction houses seem to work via Spinks book.

[Colin G. 147]

(i can hear John Stephenson now when i say BOOK PRICES)

And I would agree with him, don't get too focused on the price books, if you are telling me that compared to auction houses on a specific coin, similar grade coins are selling for less on ebay, then buy them on ebay if you want one, and sell them through the auction house if you have one to sell

[Rob 3,002]

Why is it only auction houses and Martin Platt get book prices or more for coins.

Any auctions i watch on fleabay are always wayyyyyy under book prices for rarer or decent graded coins (i can hear John Stephenson now when i say BOOK PRICES) but auction houses seem to work via Spinks book.

(i can hear John Stephenson now when i say BOOK PRICES)

And I would agree with him, don't get too focused on the price books, if you are telling me that compared to auction houses on a specific coin, similar grade coins are selling for less on ebay, then buy them on ebay if you want one, and sell them through the auction house if you have one to sell

I think it is too easy to assume that you are comparing similar items. Rarely do you find low to average grade lots in the major sales whereas on eBay they are the norm irrespective of what grade is claimed. You find that book prices or better apply in the saleroom simply because you aren't working with a complete unknown (or at least not to the same extent, nor as likely), nor in general is the grade likely to be out by as much as half a grade - certain places excepted. That gives people more confidence to bid higher, plus if an auction lot is misdescribed, then you can send it back just as you can with any reputable dealer.

Prices on ebay seem to be based on a two pronged approach. The first is that any high grade claimed is more than likely suspect and so the item is priced down accordingly. At the bottom end, you find higher than expected prices, probably because Spink etc only price grades down to fine and so the direst item seen must therefore be fine. Using this assumption, it is easy to see that VF can easily be unc in the eyes of the average punter.

Common things in less than unc don't sell at all well in auctions and are better sold on ebay where people pay over the odds on what is a minor outlay of some tens of pounds. The two venues genuinely cater to different markets. A currency KGV shilling would never make a single lot in an auction if only EF. In fact only rare dates would have any chance in UNC, with most being consigned to multiple lots, but that EF shiling would be your standard bread and butter on eBay. A rule of thumb seems to be that it has to have a fighting chance of making £40-50 hammer to be considered for a single lot.

[Rob 3,002]

I'm staggered yet grateful to read the findings, absolutely the reality no doubt! It seems to me that the only way forward is to be there on the day, which is impractical for most of us middle-of-the-road traders and collectors, it is an 'all or nothing' adventure it seems! Human nature! Good practice for the seller, though!

This is by far the best policy in any case. Baldwins, DNW and St. James' all have viewing before the sale on the day, so if you want to see specific lots in the hand, then turn up at 8 o'clock and check the ones of interest. Spink don't have viewing on the day, so must be viewed beforehand. Most provincial auctions have pre-sale viewing, though the sheer quantity of dross in the bulk lots makes it a full day's job to sort through in any case. Thankfully, a bulk lot in the major rooms is typically limited to a handful of coins in Fine to VF with a few defects i.e. creased, chipped, worn or just plain ugly.

Seeing the coins gives you the advantage of only bidding on what you want. If you see a coin that would disappoint you should it be won, then don't bid. This certainly reduces unwanted purchases.

[Fubar 71]

Well there we have it, shill bidding is allowed

Certainly isn't.

Shill bidding is the practice of bidding up your own item or getting someone to do it for you. It's very difficult to find a definition on the net because of all the fleabay news.

http://definitions.dictionary.net/shill

Nothing to do with the auctioneer.

The practice of "ringing" is more common at live auctions where bidders (usually dealers)get together and agree not to bid against each other. Quite the opposite to "shill" bidding.

[Colin G. 147]

Why is it only auction houses and Martin Platt get book prices or more for coins.

Any auctions i watch on fleabay are always wayyyyyy under book prices for rarer or decent graded coins (i can hear John Stephenson now when i say BOOK PRICES) but auction houses seem to work via Spinks book.

(i can hear John Stephenson now when i say BOOK PRICES)

And I would agree with him, don't get too focused on the price books, if you are telling me that compared to auction houses on a specific coin, similar grade coins are selling for less on ebay, then buy them on ebay if you want one, and sell them through the auction house if you have one to sell

I think it is too easy to assume that you are comparing similar items.

But if you are comparing similar items the above guidance would make perfect sense

[azda 973]

Why is it only auction houses and Martin Platt get book prices or more for coins.

Any auctions i watch on fleabay are always wayyyyyy under book prices for rarer or decent graded coins (i can hear John Stephenson now when i say BOOK PRICES) but auction houses seem to work via Spinks book.

(i can hear John Stephenson now when i say BOOK PRICES)

And I would agree with him, don't get too focused on the price books, if you are telling me that compared to auction houses on a specific coin, similar grade coins are selling for less on ebay, then buy them on ebay if you want one, and sell them through the auction house if you have one to sell

I think it is too easy to assume that you are comparing similar items.

But if you are comparing similar items the above guidance would make perfect sense

Here's one in particular, although i think wrongly attributed as UNC, i think is proof. Still not in hand yet and the sellers picture was particularly shite, but the fileds definately look prooflike and seems that the rim is a lot thicker than normal.

In total, 22.21 euros paid, but i paid this hoping its the proof i think it is. We'll see when it arrives. Sorry about the small picture, but hopefully you'll see what i mean from it and he only had the REV showing.

Edited November 25, 2011 by azda