Rogue traders probably teens

By MICHAEL FOREMAN

Disgruntled members of New Zealand's largest online auction site, trademe.co.nz, have accused the site's owner of failing to protect them against dishonest traders.

Hastings-based trader John Saunders, known on trademe as "The Wizard", said a few rogue members were making the site a perilous place to buy and sell goods.

"I've been on the site for two years, but what we are getting now are people who think it's fun to join up and then try and sell stuff that is non-existent or make bids in auctions when they have no intention of buying. Trademe seems to be saying let the buyer beware but people do get their fingers burned."

Lately the website's online discussion forum has been filled with complaints about a small number of teenage traders who have stolen hundreds of dollars of payments for goods that never arrived. According to users, when Trademe has disabled the membership of known dishonest traders they simply join again under a different name.

Trademe general manager Nigel Stanford admitted there were "a few troublemakers" whose membership had been disabled.

"We also disable [the memberships] of people who go into debt and don't pay for their goods," he said.

But Mr Stanford said the problem was limited to 5 to 10 people out of a membership that had reached 66,000.

"A couple of kids are doing it in phases. They'll do it for a month and then get bored, then they will come back again."

Mr Stanford also conceded that some trademe sellers bid on their own goods, a practice which is illegal in conventional auctions.

"That definitely occurs but you'll get it across all auction sites. The vast majority of people are pretty happy with the way it runs."

Mr Stanford said 12,000 people visited the site each day, of which only 30 to 40 were posting complaints on the message board.

"Overseas sites force you to provide your credit card details when you join," he added.

"Unfortunately, in New Zealand the proportion of credit card holders is much lower and we are not in a market position to force people to do that."

However, trademe would soon implement some new security features.

These included making member ratings, which rank the trustworthiness of members based on user feedback from previous transactions, more easily visible.

Mr Stanford claimed trademe could already track those bidding on their own goods.

"In theory, it's pretty easy to open a hotmail account and do whatever you like, but if the same Machine is used to place an auction and then to bid on it then we are able to track that.

"We don't like to let people know we can do that because it would alert the people concerned."

At present auctions in New Zealand are regulated by the Auctioneers Act, 1928. The act prohibits unlicensed persons from acting as an auctioneer, as well as making it illegal for anyone to bid on goods they are offering for sale.

But there is uncertainty whether online auctions are covered.

Mr Stanford agreed that the act also prohibited people under 16 from bidding at an auction, but according to legal advice, trademe.co.nz was not classified as an auction.

"We are not auctioneers because we don't accept the cash when a sale is made. We have created the venue where a sale may take place."

Last year the Law Commission said it was "entirely undesirable for a person conducting an auction online to be unsure whether he or she is conducting a valid auction".

The Ministry of Economic Development released a discussion document on the Auctioneers Act including online auctions.