Penny auction sites are becoming more prominent these days, with some even purchasing advertisement space on network television. One company, called Mad Bid, claims to offer hot deals for pennies on the dollar; however, there are several complaints regarding a so-called Madbid scam. Before you spend even a few cents at this site, read the following review.
How does it work?
Similar to other penny auction sites, such as Skoreit, Quibids and Beezid, Mad Bid puts items up for auction so its members can compete for the right to purchase them at a discount rate. While this may sound like a great way to take advantage of some hot deals, in reality, it's not.
To participate, Madbid.com requires its members to purchase bid packs. Each time you place a bid on any one specific item featured in a Madbid auction, you lose that bid and the money you used to purchase it. This holds true whether you win the actual auction or not.
A risky investment
The Madbid scam works by enticing members into repeatedly bidding on an item. The more you bid, the more you've invested. This makes you more inclined to keep bidding for fear that you will lose your initial investment. Mad Bid profits in two ways: by collecting fees from failed bidders and by collecting the final payment for the auctioned merchandise.
The Better Business Bureau has listed auction sites like Madbid.com in its list of Top Ten Scams. More like gambling than a source of hot deals, Mad Bid appears to profit by deceiving consumers. That said, although this review is negative, if you're the type that enjoys high risk, high reward entertainment, you may enjoy the site. Just remember that the program is less like an auction and more like a game of chance.