Legal Definitions - shilling

Shilling refers to the deceptive practice of placing bids at an auction with no genuine intention of purchasing the item, but rather to artificially inflate its price. This manipulation is often carried out by the seller themselves, or by someone acting in collusion with the seller, to trick legitimate bidders into paying more than the item is truly worth or would otherwise fetch.

• Online Collectibles Auction: A seller lists a rare baseball card on an online auction platform. To ensure the card sells for a high price, the seller creates a second, anonymous user account. As the auction nears its close, they use this fake account to place several bids, driving up the price significantly. A genuine collector, seeing the rising bids, believes there's strong competition and places an even higher bid, ultimately winning the item at an inflated cost. This act of the seller using a fake account to bid on their own item is an example of shilling.

• Live Art Auction: At a prestigious art auction, a gallery owner wants to boost the perceived value of a particular sculpture they are selling. They arrange for an associate to sit in the audience and place bids on the sculpture, especially when genuine bidding slows down. The associate has no intention of buying the artwork but is simply there to create a false sense of demand and competition, encouraging legitimate art collectors to bid higher than they otherwise would have. This coordinated effort to manipulate the bidding process is a clear instance of shilling.

• Real Estate Auction: A property owner is auctioning off a commercial building. Concerned that the bids aren't reaching their desired minimum, the owner asks a trusted friend to attend the auction and place several bids throughout the event. The friend's bids are not genuine offers to purchase the building but are strategically placed to push the price upwards and create an illusion of intense buyer interest. This deceptive tactic, aimed at artificially inflating the building's sale price, constitutes shilling.