Might be legit, but it's not an "Auction" as much as a Slot Machine
Posted May 15, 2012 10:28 AM
Think of it, a whole bunch of people putting quarters into a room full of slot machines, and every once in a while one machine Pays Off with a lot of screaming and shouting, bells and flashing lights.
But at the end of the day, the house makes a lot of money. It's hard coded into the odds of the machines.
Even if the "winner" gets to buy a $500 item for $20, there were another 600 people that paid $1 each for a chance to buy it - and the item only cost the house $250 wholesale. Even after they pay for the website and bandwidth and other incidentals, they've still cleared a clean $300 to $400.
And as someone said, Shill Bidding is an easy way to whip up a fervor and inflate the price - or in this case, induce more people into placing bids at $1 each.
Even if you "Lose" and the Shill Bidder ends up being the "winning" bidder it's a left-hand, right-hand thing. Handwavium makes it go away, and you put the item back into the pool to sell later.
If you went there to have fun playing the slot machine, more power to you. But if you went there to get a proper deal on the marker, RUN.