DropCatch, a popular domain drop-catching and auction marketplace, has been “cleaning house,” after reports of shill bidding surfaced.
Last month, reports of auctions being restarted due to non-paying bidders, led frustrated domain investors to a lengthy exchange over at NamePros.
“DropCatch.com is very much like a game of hot potato, where fraudulent bidders bid up auctions and don’t pay when they come out winning. There is a significant amount of auctions being restarted due to winners not paying up, when compared with other expired domains auctions platforms. The result is that legit bidders have to pay, literally, for the presence of so many fraudulent bidders on this platform that bid up the prices for legit bidders.”
According to the report, DropCatch user WittyNut bid up dozens of domain auctions, causing inflated prices for competing bidders; these auctions would then be restarted.
In early November, Jeff Reberry of DropCatch, entered the conversation with the following statement:
Thank you for bringing these things up. We see and recognize the issue here. We are working on a plan to rectify this, please give us this week to fully figure out what is needed programmatically and allow us to give you all an extremely fair proposal on how to resolve this. We will be fully transparent.
Jeff Reberry returned with updates on November 22nd, addressing the WittyNut deadbeat bidder issue:
“In regards to WittyNut – we had an internal glitch whereby this user was allowed to bid without having to pay for domains in his cart dating back to March 2017. Therefore, over the course of many months, the user WittyNut was able to continue participating in auctions even though they had unpaid items in their shopping cart. This issue was isolated to this one account. We discovered the issue with WittyNut back in August, prior to this thread. In fact, it was the weed.cc marketplace auction that ultimately made us aware of the unpaid items in this users shopping cart.
Upon discovery, we immediately prevented WittyNut from participating in any additional auctions and demanded payment. This user quickly responded and we agreed on a payment schedule on the remaining balance. This user started making payments and made us believe we would be paid in full for the entire outstanding balance. However, this user still has 69 domains unpaid for and we will be re-auctioning next week.”
DropCatch users stated once again they are seeking transparency in the system.
Jeff Reberry of DropCatch.com gave a lengthy update on Thanksgiving, asking for more time for fully resolving current issues and to address any cases of domain shill bidding and unpaid auctions:
“Reiterating my point once again – WittyNut was a mistake on our end. In no way did I or any of our employees realize how many auctions this user won without paying for outstanding domains in the shopping cart. This issue was isolated to this one account. Every single non-paid dropped domain will be re-auctioned.
[…] We are close on our full analysis – but we still need a few more days. We will have final deals after this holiday weekend.”
In recent months, other domain auction marketplaces, such as GoDaddy and NameJet were plagued by shill bidding claims, leading them to perform internal audits.
For the DropCatch.com discussion, click here.
So after this wittynut won the auction where did the domain reside? In wittynut’s Namebright account or? Because I have seen other domains get reauctioned and my assumption was a non-paying bidder of the first auction. It would be extremely bizarre for the dropcatch/namebright systems, which are based on rules/logic/coding, to allow one person to not pay but for everyone else they are required to pay and domains get reauctioned if they don’t. In fact, the only logical thing I could think of is if the wittynut account did not have the same rules as everyone else’s account. Maybe everyone else had a regular user account and wittynut had say, a superuser or admin level account with a different rule set. I wonder who that would benefit.
Tim – Good question. My assumption would be that the glitch involved keeping an account active for months on end, all while no payments were made. Domains aren’t transferred to an account (at NameBright) until payment is made, they remain with DropCatch until then. Their system failed to flag those non-payments for some reason.
Why going round and round! Dropcatch.com is using this/these artifical ID’s to increase the end price of auction.