Readers of Coin Update News often bid on or order coins online, typically from portals like eBay, iCollector, Auction Zip or Proxibid. Sellers on eBay are more astute when it comes terms of service, primarily because they want good feedback on their sales. Not so with auctioneers who sell coin estates, often through Proxibid, which like eBay has begun rating sellers and will release those data later in the year.
This article explores all the service terms you must deal with when you place a bid in an online auction.
Here is a typical service term from one of Proxibid’s sellers:
All property is sold “AS IS,” and ALL SALES ARE FINAL. Buyer has no right of return after an item has been declared “sold.”
This particular seller is typical of Proxibid newbies that seem to be signed up by the sales team and then left to their own devices until someone complains to quality control, which is why Proxiblog.org was inaugurated four years ago to uphold numismatic standards on the portal. When Proxiblog began posting, Proxibid had to be convinced that there was something called The Hobby Protection Act and that auctioneers could not sell counterfeit coins as genuine.
To the company’s credit, its Unified User Agreement now upholds numismatic standards when it comes to counterfeits. Some excerpts:
5. Default Event Terms. 16. If, within a reasonable amount of time, Buyer gives notice in writing to Seller that the lot so sold is a counterfeit and after such notice the Buyer returns the lot to Seller in the same condition as when sold, and establishes to the satisfaction of Seller that the returned lot is in fact a counterfeit, Seller as agent for the consignor will rescind the sale and refund the purchase price.
Another section of Proxibid’s service terms (6.3 Dispute Resolution) notes that if a seller loses a claim “because the item sold is counterfeit, Seller will be required to provide a full refund to the Buyer. Seller liability will include the full purchase price of the item and original shipping cost (and in some cases, Seller may not receive the item back).”
It has been an educational experience between Proxibid and Proxiblog. Proxibid can be one of the best venues to find coins, especially raw ones, from Internet-savvy sellers (most of them eBayers or guild-member coin dealers). A few bonafide auctioneers stand out, including Leonard Auction, Meares Auction, Weaver Auction, Western Auction and others. Visit Proxiblog and see favorite sellers in the right sidebar.
We have bid on, won and returned a half dozen counterfeit coins on Proxibid. In no case did the seller insist that “all sales are final.”
Here is an example:
This was deemed a fake probably made in Lebanon in the 1970s. It was detected using John Dannreuther’s Official Guide to Coin Grading and Counterfeit Detection.
But service terms do not end there for the online coin bidder or buyer. There are PayPal and credit card service terms, too, and they also involve security or other legal matters. Call it coincidence or timing, but this email just popped up during the writing of this post at this particular juncture in this article:
Back to Proxibid. The newbie seller mentioned above also posted this service term:
“Payment is by credit card (mastercard or visa), money order, or wire transfer only. Payments to RA are non-refundable. Sales Tax: 5.00% – Tax may apply to the total invoice, including Buyer’s Premium Participation Requirements: Valid Credit Card required for bidding approval Payment Options: Visa, MasterCard, Money Order, Wire Transfer Payment Instructions: Please contact Auction Company for payment instructions.”
When you give your credit card data to an auctioneer, you may be losing rights according to service terms (portal, PayPal, etc.) should your personal information (or identity) be stolen. You have no idea who will see your credit card data at the auction house or seller’s home. Some auctioneers even solicit it via email, with a host of liability issues there. See this Proxiblog post.
If you use eBay, you can be protected by PayPal. If you use Proxibid, you can rely on Auction Payment Network. Its security is good, and bidders rely on the APN badge when buying on Proxibid. For a video on how Auction Payment Network works, click here.
Suffice to say that APN has its own service terms, just like PayPal. Again, all sales are not final, especially when dealing with counterfeit coins. Note to Proxibid auctioneers: If you don’t like dealing with bidders sold counterfeit coins, try dealing with the Secret Service, as one of the country’s top counterfeit experts, the resident agent in charge, is right there in Omaha, where Proxibid is located.
All right then, suppose you make a purchase through APN on Proxibid and are dissatisfied with your purchase, not because the coin is counterfeit, but because you sent it to PCGS and it came back as an altered coin? Can you override the service terms of Proxibid, Auctioneer, and APN?
If you bid with a Chase Sapphire Card, you can. We used the company before to help cancel a purchase because the coin was doctored.
We checked Chase’s service term at this URL, and discovered something interesting with regard to the entire question about disputing charges when an item is significantly different than as described. We took the language from this page:
“Your Rights If You Are Dissatisfied With Your Credit Card Purchases” If you are dissatisfied with the goods or services that you have purchased with your credit card, and you have tried in good faith to correct the problem with the merchant, you may have the right not to pay the remaining amount due on the purchase. To use this right, all of the following must be true:
1. The purchase must have been made in your home state or within 100 miles of your current mailing address, and the purchase price must have been more than $50. …
2. You must have used your credit card for the purchase.
If all of the criteria above are met and you are still dissatisfied with the purchase, contact us in writing at the Customer Service address or electronically at the website address shown on your billing statement.
Did you catch the 100-mile radius? We did, and we contacted Chase for a response. Its agents were baffled. They assured us that the 100-mile radius was wrong. The best explanation they could find was this language was never updated for the digital age.
There’s one more set of service terms that bidders seldom see. It is the one that the auctioneer sends to the consignor. Here’s a sample one from Leonard Auction.
John Leonard is an expert auctioneer who understands numismatics. In the consignment form, he lists this pertinent clause:
5. REPRESENTATION OF GENUINENESS: Consignor represents and warrants each item to be genuine. Consignor agrees that any item found to be non‐genuine within thirty (30) days of the auction date, will be returned to the Consignor, and upon return, Consignor will pay Leonard Auction, Inc. the net proceeds of the returned item.
In the end, from a numismatic standpoint, this is the service term that matters and what the Proxibid sales team should be explaining to newbies whom they sign up on the portal.
So which service term prevails? Answer: The service that you won’t mind losing should the company bar you from its site or product. In other words, this is less about money than about the service.
Finally, we asked media theorist Eric Abbott at Iowa State University what he thought about competing service terms, and he said something that relates indirectly to this discussion and, coincidentally, directly to Proxibid. Almost everyone in America believes in or has a mortgage, he says. Upon closing on a house or business, we enter the bank and sign a cargo of legal documents. We don’t read them. “In Egypt, few people have mortgages because they do not trust the system. In America, we have faith in certain systems. It’s a matter of trust.”
Proxibid’s brand is “A Marketplace of Trust.” One of its publicized risk management promotions states: “Functionality that allows buyers to report an item they believe to be counterfeit, illegal, inappropriate, or misrepresented.”
To strengthen its brand of trust, and the digital system employed to place a bid, we think Proxibid should change a clause in its Unified User Agreement:
Seller shall not knowingly misrepresent any items. VALUES OF ITEMS SHOULD BE BASED ON VALID APPRAISALS OR VERIFIABLE DATA. All catalog descriptions must accurately describe the items for sale, and all photos must be original. If Seller uses stock photos, Seller must disclose so in the catalog description as well as in the Special Terms of Sale for the auction.
What do YOU think. Leave us a comment.