Unlike typical online auctions, participants still have to pay for bids placed, win or lose. In some cases, losing bids can cost as much as winning. Some sites offer “buy it now” options. If you lose an auction, you can purchase the item for a quoted retail price minus the amount you bid.
Your BBB has received hundreds of penny auction complaints this year.
Many people have complained about being automatically charged $150 for signing up for what they thought were free trials.
Some complained sites use phony bidders or bots, which appear to be human bidders but are actually computer programs created to drive up item prices.
Others had difficulties receiving refunds or resolving other issues with the company.
If you’re considering bidding on a penny auction, you should research companies before signing up or providing personal information. Visit www.bbb.org or call (937) 222-5825 or (800) 776-5301.
Other advice:
• Read the fine print carefully. Pay close attention to details on signup and annual fees, minimum bidding requirements, maximum prize amounts and how to get a refund.
• Know what you’re buying. Before bidding on items, shop around to find out how much they cost elsewhere. Also, keep track of how much you’re actually spending on bids to make sure you’re really getting good deals.
• Review statements. Check bank and credit card statements for unexpected charges.
Penny auctions may offer great deals on desired items. Do your research to ensure you don’t lose money with nothing to show for it.
John North is president and CEO of the Dayton Better Business Bureau.
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