Catalog Sales Posing As Auctions
by gooberpyle - Written: Jul 06 '08 (Updated Jul 07 '08)
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| Full Review |
Ebay.com used to be an auction site. I know, you say "What? eBay is still an auction site!".
Well the truth is eBay is an auction site but mostly in name alone. The auction feature has long been perverted.
Mail Order Catalog Sale
What you see on eBay is mechanically similar to an auction site but fails the auction requirement on one point; sellers are not required to either own or control the items for sale.
In the USA, auctions are an asset sale. To qualify as your asset for sale, the property must be under your control. You must have to right to sell it.
Obviously, you cannot continuously sell nothing so what are the sellers selling and how does this work?
It is very simple and I'll use solar panels as an example because of the lessons I learned through several aborted attempts to purchase one.
Here it is.
1. Create many listings of various types of solar panels.
2. Collect the winning bidder money.
3. Purchase the solar panels from a wholesaler.
At the time of listing, there were no assets to be sold. Because the seller presented an auction but the actual transactions were conducted as retail mail order catalog sales the auction was fraudulent just by the nature of auctions.
Interest Free Loan To Seller
The seller in the above auction has actually borrowed money from buyers. Interest free.
Hidden Product Shipment
By necessity, this type of "auction" requires the seller to rely on their product source to ship to the buyer. At no time does the seller ever see the "goods".
If the seller were to actually re-ship the items, there would be no profit in the selling.
Is this bad? I think so because there is another layer of deceit.
The Deceit
Because product shipment in this type of "auction" is completely dependent on the wholesaler and not the "auction" seller, there can be significant delays in receiving your product.
It is not uncommon for products to be out of stock. Considering that a large number of eBay items are sold through China wholesalers, there is a built in delay in receiving products via ocean transport.
In practice, when the bogus auction fails to produce your goods, the seller unfailingly will provide a short list of excuses consistent throughout eBay.
1. Family hardship.
2. Moving to another location.
3. Have been sick.
Potential Buyer Recommendation
If you use eBay, always use a credit card and always initiate a charge back for goods not delivered if your product is not shipped within the week.
The bogus auction seller does not willingly refund your money because it means they have to foot the bill with their own money.
Conclusion
I am not a legal expert. The above opinion is based on what I believe to be illegal. The Uniform Commercial Code may disagree with my interpretation of what constitutes an auction. But I seriously doubt it.
Recommended:
No
What product did you purchase or try to purchase? Solar Panel
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