Three cases of phony bidding by sellers to inflate the price of art, sports memorabilia and a truck sold on the eBay Internet auction site were concluded last week. Three sellers pleaded guilty and five agreed to civil settlements in cases involving victims nationwide. “The use of shill bids in online auctions illegally drives up prices and defrauds consumers,” New York Attorney General Eliot Spitzer told the Associated Press.
Jerrold Schuster, of New Windsor Auction Gallery, pleaded guilty to a felony involving restraint of trade, Spitzer said. Two of Schuster’s former employees pleaded to misdemeanors of attempted restraint of trade. Schuster is expected to pay $50,000 in restitution and fines as part of the upcoming sentencing. The three men were accused of bidding on more than 1,100 of each others’ eBay items over five years to drive up the prices. In the civil settlement, Robert Baranovich and his son, Steven Baranovich, agreed to pay $10,000 in penalties and restitution for making 170 phony eBay bids on 165 of their sports memorabilia items. In a separate civil case, three men agreed to pay more than $28,000 in penalties and restitution for making 610 bids on 106 of their own automobile auctions under the user name “Mother’s Custom Automotive NY Dealer.”