Hobby U: What is 'Shill Bidding' ?
What is 'Shill Bidding' ? A third rail in the world of collectibles and auction houses in general, this topic has subsumed the hobby's zeitgeist over the past couple of weeks. After a prominent collector admitted to the practice (he later apologized), the price guide king himself Dr. James Beckett spoke in detail about Shill Bidding on his podcast causing an uproar in the sports card community. So what constitutes shilling and what doesn't?
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Shill bidding is the straightforward practice of bidding on your own card which is up for sale at auction. This is a NO GO for any collector, seller, dealer, or anyone in the world of collectibles! Furthermore, you cannot have your friends, your family, your cousin's neighbor, or anyone you know conspire with you to bid on a card. Not only is this practice illegal, frowned upon and it is just not allowed in almost all auction houses/forums. Do NOT shill bid. The hobby community is tight knit, you will be discovered sooner or later!
What isn't shill bidding? Let's say you own a copy of a highly sought after Mookie Betts card. It is well within your right to bid on a DIFFERENT copy of the same card, as long as you are bidding in earnest with the intention of buying the card. It is not shill bidding to horde cards that you like or think are undervalued.
Why is this important? As the hobby continues to grow, and more and more money flows in, we can expect more regulation (for better or for worse) as our beautiful hobby becomes more mainstream and a bigger business. Here's an example of the negative effects of the practice on the hobby. Let's say you own three example of a Michael Jordan card that is selling for $5,000. If you put up one of your cards for auction, and you (or a friend of yours) bid it up to $10,000, you end up with the card back in your collection and have lost the fees associated with the sale (let's say 20%). So you've lost $2,000 buying your card back. However, now you have a public comp of $10,000, so you are easily able to sell your other two copies of the same Michael Jordan card for a $9,000 cash deal at a card show. You've just made yourself $6,000 without doing much at all, simply my manipulating the market!
As the card market enters the world of high end art (which we've already seen with auctions at Sotheby's for example), it is important that collectors aren't left holding the bag by shady yet common practices. It is quite a difficult task for auction houses to stop shill bidding, yes it's easy to tell if you are bidding on your own card, but it is very hard to find out who all your accomplices might be. We must stay vigilant as a community to help stop this practice in its tracks, for the betterment of all collectors all over the world.
Growing up in 1990s New York City as a devoted Knicks fan, Sam discovered his passion for sports cards in grade school, when he'd visit local street dealers hunting for packs of Finest and Metal. After attending college in St. Louis, Sam spent time in Thailand and Mali working in international aid before the pull of the hobby brought him back. In 2020, he returned to collecting and launched his own card consignment business, reconnecting with the passion that defined his childhood.