It’s possible to see penny auction site advertisements everywhere, including the Internet and on T.V. The premise is pretty simple: a person pays an extremely low price to potentially win an expensive item. Of course, the keyword here is potentially. There is no guarantee that a person will win the item they bid on, and someone could spend hundreds of dollars trying to win, resulting in a loss of money. Unfortunately, penny auctions are filled with scams and other problems. In fact, the overwhelming majority of these sites are not legitimate. Here are some reasons to avoid penny auction sites completely.
Shill bidding is common for penny auctions.
Many penny auctions practice shill bidding, which is actually illegal in many places. Shill bidding occurs when a person who is directly related to the bidding company bids on an item to engage in “bidding wars” with others. So then, one person thinks they are fighting a legitimate bidder for an item when they are really just being scammed by someone within the penny auction site to up the price that they end up paying for an item. Plenty of sites engage in this practice, which is extremely problematic and unfair for bidders.
The use of bidding bots is also a big problem.
Bots are commonly used for tons of different reasons. Spammers use them to create thousands of fake accounts on sites to spam users. For penny auction sites, some owners actually use bidding bots against their customers and bidders. These bots will make a bid at the very last second of an auction to ensure that the actual bidder loses to the bot. Therefore, a penny auction site can reap all the proceeds from the auction without actually losing anything to bidders. This practice is rampant and extremely unfair for legitimate bidders.
Many penny auctions charge monthly fees.
A good number of penny auction sites charge users a monthly fee or a fee for a certain amount of bids each month. Unfortunately, these charges can be hundreds of dollars, and penny auction sites commonly sign bidders up for continual monthly billing so that a person could be billed unknowingly for months. Illegitimate penny auction sites try to rip as much money out of a person’s wallet and do so to hundreds to thousands of people. Sadly, these fees are extremely hard to get rid of, especially if a person wants a refund.
Some sites won’t deliver items that are won.
In some cases, a person will win an item on a penny auction site only to never receive the item in question. Some penny auction sites simply refuse to deliver an item to a bidder that wins a particular auction. There is almost no way that a person can get the item that they won or they will receive a damaged item on purpose. In reality, this is how most penny auction sites function, which means that most bidders on these sites will never receive the item that they have bid upon.
Most sites have general problems too.
Penny auction sites just have all-around issues that bidders usually have to deal with. For instance, many sites have faulty timers that reset and change constantly, which is a questionable occurrence that doesn’t “just happen”. Other sites have terrible customer service that won’t help a person out under any circumstance. On top of this, many sites have very sketchy privacy policies and bidding/winning policies. Most consumers don’t read the fine print, so they fall victim to these scams.
Stay away from penny auction sites!
In reality, I can’t think of a single legitimate penny auction site out there. There are undoubtedly one or two legitimate/semi-legitimate penny auction sites out there, but most people will fall victim to the scam sites. Sadly, penny auction sites aren’t regulated by the government or any other body, so scammers can pretty much do as they wish on these sites to scam money out of bidders and customers. The best way to not fall victim to these shoddy penny auction sites is to stay away from them completely until some entity steps in to regulate them and force them to be legitimate. Until then, watch out!
For more information, visit Penny Auction Watch, Penny Auction Scams and Fraud, and Penny Auction Fraud Tactics.