Tag Archives: Shopping

Not All Bid and Buy Penny Auction Sites Legitimate

bid-and-buy

In its continuing series focused on consumer-related tips and warnings, KingofHowTo.com has taken a look at numerous online shopping platforms. Ultimately, we’ve found that not all bid and buy penny auction sites offer users a fair chance to acquire discount merchandise.

According to our in-house technology expert, Sarah McDaniels, while some sites have taken steps to raise their reputations in the eyes of consumers; others continue a business-as-usual approach that has drawn warnings from some reputable organizations.

“When they first came out, penny auctions were almost synonymous with the word scam,” McDaniels said. “In response to numerous complaints, both the Federal Trade Commission and Better Business Bureau issued reports warning consumers that many of these sites use deceitful techniques to rip their customers off. Now some of these bid and buy sites are taking steps to prove they don’t scam their users; however, many haven’t followed suit.”

McDaniels says the FTC has warned that many penny auctions use shills or automated bots to make fake bids that drive up prices and prolong auctions. This inevitably increases bidder failure, which ultimately pads company profits. That said, some companies are attempting to separate themselves from their competitors by proving they don’t use these types of strategies.

Recently, QuiBids paid Grant Thornton, a very reputable accounting firm, to conduct a neutral, third-party audit of the bid and buy website’s business model. In the end, Grant Thornton found that QuiBids did not use automated bots to cheat its customers; and the BBB chose to upgrade the company’s rating in response. Unfortunately, according to McDaniels, few penny auctions have followed QuiBid’s lead.

“Right now, consumers really don’t have any way of knowing which sites use shills and which do not,” she said. “There are some sites that attempt to uncover this sort of unscrupulous activity by comparing total human visitors by the total actual bids to see if there is a notable discrepancy. That said, if consumers really want to be sure they aren’t getting cheated, they can either avoid these types of sites altogether or review the BBB’s ratings system to see if the particular company has conducted any sort of audit.”

Hard to Win Penny Auctions: Consumer Reports

win-penny-auctions

Bidding fee auctions have become popular with consumers looking to compete with other users for the right to purchase bargain merchandise. Unfortunately, a recent investigation by Consumer Reports revealed that most people find it hard to win penny auctions, thanks to a variety of reasons.

The Nature of the Game

According to Consumer Reports, bidding fee auctions are difficult to win, because they are set up that way. In order to place a bid, users must pay cash. What’s more, every single time an auction receives a new bid; more time is added to the auction, allowing more users to get involved. Many sites now also offer automatic bidding options which will make bids on behalf of users until the auction reaches a certain price. This can make it that much more difficult for consumers to win penny auctions, especially since automated bids are made by computers which never tire out.

Shady Tactics

Recently, the Federal Trade Commission warned consumers that many companies utilize automated bidding software to make bids on behalf of the companies, themselves. Often referred to as “bots” or “shills,” this software is typically used to lengthen auctions and drive up prices.

Recently, QuiBids voluntarily underwent a third-party audit which determined the company did not use such tactics; however, few companies have followed suit. In response to a recent feature focusing on negative SkoreIt reviews, KingofHowTo.com was contacted by the company’s CEO Joe Crivello, who asserted that his company did not use shills or bots to cheat its customers. That said, Crivello admits his company has not undergone any sort of third-party audit, leaving consumers to guess whether SkoreIt does in fact operate fairly.

What Consumers Should Know

Although Consumer Reports warns that most people do not win penny auctions; it does have some tips consumers can use to keep from getting ripped off. According to the magazine, users should think of bidding fee auctions as a form of entertainment and always be prepared to lose money. They should also only bid at sites that offer tips and advice, unlimited refunds and provide “buy-now” features. The consumer advocate also encourages users to research each company using a Google search and reports from the Better Business Bureau.

Is SkoreIt a Scam? No, says Company CEO

skoreit-penny-auction

Recently, KingofHowTo.com published a series of consumer news features that put penny auction websites under the microscope. In response to one particular article, we were contacted by SkoreIt.com Chief Operating Officer Joe Crivello. Despite numerous online reviews complaining about a supposed SkoreIt scam, Crivello insists his company is honest with its customers. Before you spend a single cent at any bidding fee auction, you should know all sides of the story.

Penny Auctions Under Fire

Recently, some powerful organizations decided to speak out about the potential pitfalls associated with bidding fee auction websites. The Federal Trade Commission, Better Business Bureau and AARP have all issued reports warning consumers about these so-called bargain websites. According to each organization, many of these companies use shady tricks to scam users; however, Crivello says these warnings do not apply to SkoreIt.com.

“It is important to note that the FTC, BBB and AARP have not indiscriminately warned consumers against penny auctions,” Crivello said. “Instead, they have warned consumers about the unscrupulous practices of some of our competitors: warnings which are simply not applicable to SkoreIt. Specifically, their concerns tend to focus on shipping delays, hidden costs, misleading terms and poor customer service.”

Despite Crivello’s statement, the fact is that the FTC, BBB and AARP have warned that most consumers tend to lose money when they participate at penny auctions. According to the FTC, because bidders are forced to pay for the right to bid, they lose money even if they don’t win the auction. Additionally, the FTC states that even winning bidders often end up paying more for an item than they expected.

Is SkoreIt All that Different?

The FTC has warned consumers that many penny auction websites use automated software known as “bots” or “shills” which make bids on behalf of the company. According to Crivello, his company does not employ this type of strategy, and he says all SkoreIt.com employees are contractually bound to never place bids on any company auction.

Recently, QuiBids underwent a third-party audit performed by Grant Thornton, which determined the company did not use shills; however, according to Crivello, his company has not taken similar measures to prove that every auction is fair.

“SkoreIt has not conducted an audit with Grant Thornton, although we are evaluating that and similar options for continuing to demonstrate our commitment to the fairness of our auctions,” he said.

What Consumers Should Know

Many consumers are attracted to penny auctions, because they represent a form of high-risk, high-reward entertainment. That said, consumers should be wary of companies that might use unscrupulous strategies to encourage bidder failure. According to Crivello, consumers shouldn’t be worried about a SkoreIt scam, because it’s in his company’s best interest to provide a positive experience to its users.

“We believe that customer education is one of the most important things that we can dedicate our time to,” he said. “Accordingly we have built a detailed help section on our website. We also send our new customers helpful pointers via email, if they choose to opt in for them.”

Ultimately, without third-party audits, consumers have no way of knowing which penny auction is truly on the up-and-up. Until Crivello’s company invests in this sort of in-house investigation, users will either have to take the CEO’s word or choose to spend their money elsewhere.

Is your Organic Garden Toxic? Maybe, says Study

garden

These days, more and more consumers are turning to their backyards for natural fruits and vegetables free from potentially harmful pesticides. Unfortunately, according to a recent report, that organic garden you’re so proud of may actually be filled with toxic metals and chemicals.

Disturbing Report

The Washington Toxics Coalition and the Ecology Center recently issued a report detailing some disturbing test results centered on popular gardening products sold at numerous popular chain stores. According to analysts, water hoses, gloves, common hand tools and knee pads all tested positive for dangerous metals and chemicals, including phthalates, BPA, cadmium and lead.

In the case of gloves and hand tools, the plastic grips were found to contain phthalates, which are known to disrupt hormones in human beings. Many metallic tools were found to contain cadmium, which has been shown to cause learning delays, birth defects and other significant health issues.

Perhaps most troubling was the fact that testers found high levels of lead inside water hoses. According to researchers, this toxic metal can easily leech out into your so-called organic garden. It can also mix into the soil, causing you to track the harmful particles into your home, where it could be breathed in or ingested by small children, who are especially sensitive to the effects of toxic metals.

Keeping your Organic Garden Natural

According to researchers, consumers should look for gardening products that are free from lead and PVC. More often than not, American-made products do not contain as many of these toxins, thanks to federal regulations. On the other hand, imported products – especially from China – often contain harmful chemicals and metals, thanks to poor overseas regulations and lax U.S. policies associated with imports.

If you’re not sure whether your tools contain toxins, experts say you should follow some basic gardening safety practices. Wear cloth gloves that don’t have rubber grips and keep your tools and water hose out of the sun, which has a tendency to promote leeching. Additionally, experts recommend that you flush your hose in a restricted area prior to watering your garden to eliminate any lead that may have leeched out and pooled within. You should also remove your shoes before entering your home to minimize the chances of transferring harmful particles inside.

SignatureBid Scam? Luxury Penny Auction Review

Luxury-Penny-Auction

Throughout our continuing consumer scam series, we’ve taken a look at some of the more popular penny auction sites, including QuiBids, SkoreIt and more. It seems new bidding-fee auction websites pop up every day; however, most tend to abide by the same business model. Recently, a relatively new company called Signature Bid began promoting itself as a source for luxury items. That said, there are already plenty of online reviews buzzing about a supposed SignatureBid scam. Before you participate, learn what reputable consumer advocates are saying.

Different from other Penny Auctions?

Although Signature Bid describes itself as a “luxury” penny auction, it sells the same types of things available at other bidding-fee auction websites. A close inspection reveals no noticeable difference between this website and other sites, such as DealDash, QuiBids and SkoreIt – except for one thing: as of publication of this article, SignatureBid.com is not rated or accredited by the BBB.

Consumer Advocates Speak Out

A few months ago, the Federal Trade Commission and the AARP each issued reports warning consumers about specific pitfalls associated with bidding-fee auction websites. According to each organization, most people lose money in these competitions, because they are forced to pay for every single bid they make.

SignatureBid Reviews Say Scam

A quick Internet search yields reviews warning about a supposed SignatureBid scam in which the company allegedly uses software to make fake bids that drive up prices, prolong auctions and swindle users. While it’s not clear if there is any merit to these claims; the FTC warns that many of these companies do in fact use automated bots to cheat consumers.

What You Should Know

Although the Better Business Bureau doesn’t necessarily endorse penny auction websites; it has given some its highest rating based on the total number of complaints received in comparison to a company’s size. Although most people do tend to lose money at these websites; some view them as a form of high-risk entertainment. If you agree, just be sure to check the BBB’s ratings before signing up and avoid companies that become the target of a significant amount of online complaints.

When is Getting a Credit Card a Good Idea?

getting-a-credit-card

A recent decision by the Consumer Financial Protection Bureau has many consumers asking an important question: is getting a credit card a good idea? Before you fill out an application, learn how new rules may affect the value of revolving accounts.

Why They Are Important

A credit card is a good idea for anyone seeking to establish credit and/or safeguard against emergencies. These days, revolving accounts can also offer cardholders big rewards in the form of cash-back, gas rebates and discounts on travel and certain brands of products. That said, the value of each individual offer is wholly dependent on interest charges and annual/upfront fees. Recently, the CFPB relented on its plans to prevent providers from charging high upfront fees; and consumers are likely to face escalating costs going forward.

Why Fees May Be Going Up

Currently, banks are not allowed to charge fees totaling more than one-quarter of a cardholder’s limit during the first year of a revolving account’s existence; however, there is no limit to what they are allowed to charge before the applicant activates the account.

The CFPB recently announced it would abandon a charge to limit the upfront fees providers are able to charge cardholders after the bureau lost a federal court case in South Dakota. Since its inception, the young agency has faced all sorts of resistance from corporate lobbyists and conservative politicians who argue that its policies might hamper the struggling economy. To the chagrin of many consumer advocates, the powerful opposition proved successful in stymieing the CFPB’s attempts to limit upfront fees, which provide big profits to banks, while eating up a substantial portion of cardholders’ available credit.

Is Getting a Credit Card a Good Idea?

The CFPB’s decision to allow providers to charge whatever they want pre-activation is likely to cost cardholders with poor credit the most. Often, these fees can amount to as much as $100. This can put a big dent in a cardholder’s available balance, especially if they have dings to their credit which tend to result in lower spending limits.

That said, consumers can still get great value out of their credit cards if they zero out their balances at the end of every month. By doing this, they can avoid interest fees, while improving their credit reports. Additionally, consumers have the ability to offset some or all upfront fees by utilizing reward cards that offer cash-back and discounts on everyday purchases. To get the most value, it may be wise to accept higher upfront fees in exchange for low interest rate credit cards and/or those that offer incentives.