EBay shill bidder fined £3,500
A man has been fined £3,500 and ordered to undertake 250 hours of community service after bidding on his own eBay listings to drive up the price.
It was the first prosecution in the UK for the practice known as 'shill bidding'.
Paul Barrett, 39, increased the price of the items he listed on eBay by bidding on them under a different username. In April 2010 he pleaded guilty at Bradford Crown Court to 11 charges under consumer protection laws.
North Yorkshire trading standards officers began investigating Barrett after receiving a complaint about a minibus advertised on eBay. Barrett claimed the vehicle had covered just over 55,000 miles but once the complainant had bought the minibus he found it had been 'clocked' and has actually done over 132,000 miles.
During the investigation, Trading Standards officers obtained Barrett's eBay records and discovered he had used two usernames to increase the bidding on the items he listed. As well as the minibus, his listings included other vehicles and assorted goods.
Barrett was proscuted under the Business Protection from Misleading Marketing Regulations, because some transactions were business to business sales, and also under the Consumer Protection from Unfair Trading Regulations, because some transactions were business to consumer sales.
The Business Protection from Misleading Marketing Regulations 2008 prohibit any advert that "in any way, including its presentation, deceives or is likely to deceive the traders to whom it is addressed or whom it reaches; and by reason of its deceptive nature, is likely to affect their economic behaviour". The regulations include "the price or manner in which the price is calculated" as factors in determining whether an ad is misleading.
The Consumer Protection from Unfair Trading Regulations 2008 prohibit unfair commercial practices, including misleading actions and omissions. They also ban the practice of "Falsely claiming or creating the impression that the trader is not acting for purposes relating to his trade, business, craft or profession, or falsely representing oneself as a consumer."
Both sets of Regulations provide for a maximum sentence of an unlimited fine and up to two years' imprisonment for each offence.
Shill bidding could also be prosecuted under the Fraud Act in England, Wales and Northern Ireland, which includes an offence of dishonestly making a false representation with the intent to make a gain or to cause loss to another. The maximum penalty under that law is 10 years in prison and an unlimited fine.
Trading Standards commented: "This case should be a stark warning to people using eBay and other auction sites that if they shill bid or encourage family and friends to place fake bids to push up prices artificially, they too face prosecution."
The High Court has ordered a chef to pay £10,000 in libel damages for a Facebook posting in which he called a former friend a gay paedophile.
Law student Raymond Bryce said he was neither.
Jeremy Barber posted a picture of child sex abuse on Bryce's Facebook page along with the message "Ray, you like kids and you are gay so I bet you love this picture, ha ha", which was then reported in The Sentinel newspaper in Staffordshire, where Bryce lives.
The allegation of paedophilia was serious and could have damaged Bryce's person as well as his reputation, Mr Justice Tugendhat ruled. He said that it was not unknown for people wrongly accused of paedophilia to be attacked.
Barber had earlier been sentenced to community service for the offence of distributing the image, and has now been ordered to pay £10,000 in damages.
Consumers are entitled to leave their broadband providers early without penalty if internet access speeds are too slow, under new plans drawn up by telecoms regulator Ofcom.
Ofcom has also urged advertising regulators to develop a new measurement, 'typical speed range', on which fair comparisons can be made.
Research just published by Ofcom shows that the gap between the advertised speeds of broadband access and the actual speeds experienced by internet service provider (ISP) customers is growing.
A new code of practice on broadband speeds will give customers the right to leave their ISP without paying any contract penalties in the first three months of their subscription if their actual download speeds are far below the advertised speeds.
Offcom stated that under the code ISPs will give consumers the option to leave their contracts early with no panalties (within three months of signing up to the service) if they receive a maximum line speed that is significantly below the estimate they are given at point of sale and the ISP is unable to resolve the problem.
Though average download speeds have increased in the past year, the increase in the advertised speeds has grown at a faster rate, Ofcom's research said.
Ofcom states: "In April 2009, average actual (or download) speeds were 4.1 megabits per second (Mbit/s), 58 per cent of average advertised 'up to' speeds (7.1Mbit/s). In May 2010, average download speeds were 5.2Mbit/s, 45 per cent of average advertised 'up to' speeds (11.5Mbit/s)".
The new code of practice on broadband speed is voluntary and only applies to those companies which sign up to it, but Ofcom said that the country's biggest ISPs BT, Talk Talk and Virgin have all indicated that they would sign up to it.
Ofcom said that it was also seeking to take action on the advertising of broadband services to ensure that potential customers have a more realistic view of the likely quality of companies' services. It said that it has made two suggestions to advertising industry regulators the Advertising Standards Authority (ASA) and the Committee on Advertising Practice (CAP).
Ofcom continued: "We have recommended that speeds should only be advertised if at least some consumers are actually able to achieve the advertised speeds [and that] those who advertise according to 'up to' speeds, should also include a 'typical speed range' (or TSR) based on a standard currency to be developed, similar to those in other industries (for example, APR in financial services, and MPG in motoring)".
"Actual speeds are often much lower than many of the advertised speeds which makes it essential that consumers are given information which is as accurate as possible at the point of sale; this is what the new Code is designed to deliver," said Ofcom.
The research found that services operated over fibre optic cables rather than copper phone lines, such as Virgin's, delivered "significantly faster" speeds compared to advertised speeds. It found, though, that cable services suffered a more severe slowing of speeds at busy periods than phone line based services.
The OFT has ruled that Gym membership contracts that last for three years without cancellation rights breach consumer protection laws.
The OFT is taking Ashbourne Management Services, which provides membership agreements for gyms, to court over its practice of signing up gym members to contracts with no right of cancellation. Those members who try to leave are invoiced for the remainder of the three year term and their details passed on to debt collectors if they fail to settle the entire balance.
Forcing consumers to pay the full contract amount if they wish to curtail long contracts breaches the Unfair Terms in Consumer Contracts Regulations 1999, says the OFT. Further, the OFT finds Ashbourne's practice of reporting consumers to credit reference agencies aggressive and misleading and therefore it breaches the Consumer Protection from Unfair Trading Regulations 2008. At the time of the OFT's intervention, Ashbourne had registered 17,000 defaults with credit reference agencies.
The OFT said that it believes that Ashbourne's conduct is also in breach of the Consumer Credit Act. It said that because the contracts bind a consumer to pay a fixed sum of money over a set period of time, the Act should apply. For this reason, the OFT holds that none of the agreements could be enforced in the absence of a court order because the agreements should have set out clearly and upfront the total amount the consumer is liable to pay, and comply in all other respects with the rules under the Act.
Consumers need to be able to understand the nature and extent of their liabilities before entering into contracts, and The Consumer Credit Act sets out rules to ensure this, and the OPT expects traders offering credit to comply with this requirement.
'Likewise, traders should not use unfair contracts or misleading or aggressive practices in order to put pressure on consumers to pay money that the trader may not otherwise be entitled to," said the OFT. "We have concerns about Ashbourne's practices, but as the company disputes our interpretation of the law we have asked the High Court to rule on this."
The Unfair Terms in Consumer Contracts Regulations are designed to protect consumers because sales contracts are not negotiated, consumers usually only have a choice to accept or reject them, bt not to negotiate specific terms.
The Consumer Protection from Unfair Trading Regulations govern the way that businesses treat consumers and contain a general prohibition against companies treating consumers unfairly.
e-sue is warning employers who take on interns and young people seeking unpaid work experience that the law generally regards them as 'workers' who must be paid at least the minimum wage.
Paying expenses only or free meals can break the law and expose employers to thousands of pounds in claims for back pay.
It is a common fallacy that companies are entitled to take on unpaid workers under the guise of work experience and internships as long as both sides are aware that these positions are voluntary, according to The Institute for Public Policy Research (IPPR) and campaign group Internocracy.
However legal expert, Mark Andrew, points out that most of these positions fit the legal definition of 'workers' because certain hours and certain tasks are expected by the company, which is essentially benefitting from their free labour. This means they must be paid at least the minimum wage, and e-sue is currently reclaiming thousands of pounds in back pay for clients who were only paid fares under work experience arrangements.
"These claims can date back up to six years, and in many cases can amount to thousands of pounds", Andrew reports. Many private sector companies openly advertise expenses-only work experience positions and internships which in reality do not differ from the roles undertaken by employees.
The myth perpetrated by some employers is that there is a grey area within the National Minimum Wage legislation an exclusion - which makes unpaid labour permissible provided both sides consent to the voluntary nature of the work. "This is simply untrue", says Andrew.
In fact the law is quite clear that workers must be paid, and the only problem is the failure to enforce this obligation. e-sue drafts claims for back pay starting at £300 and can launch a claim provided the work took place since 2004.
In some industries, particularly media, architecture and even accountancy, the use of such free labour is rife because of the willingness and availability of young people who are prepared to work without payment.