Heard 350GT #148 went for $440k at RS...

I was there..it DID NOT sell..

The bid was run up and up and up..hammer fell with a big scream of "SOLD SOLD SOLD"

But there was no real buyer in the house and it DID NOT sell...

 

Is that even legal???

 

WOW! Where have we seen that before?

 

Then who the heck was bidding? I mean, to run the bid up you need two bidders... so even if one turned out to be "just scratching his nose" or "waving at a friend" there would be the other one...

 

Alberto: given the steady stream of bad news that seems to follow certain auction houses (no names will be mentioned here), I am amazed at how they are able to stay in business, and even more amazed that anyone would consign a motor vehicle with them. Having said all that, I am also amazed that anyone is willing to pay the fees that most auction houses charge.

 

Yes, it is...the Auction house has the right to "Advance" the bid as it is called in Legal terms...up to the point of not surpassing the "Reserve" on the car..they can go all the way up to that point...and then, if they wish, remove or "lift" the reserve..then at that point the car can be sold to a 'Legit" buyer...

Most of the time, in a case like this..it is just advancing the "Bid price" for future auction...then when they bring it back all the hype will be that it "Sold" for over 400K last time, so this time if you buy it at $300K..WOW you are getting a hell of a "Deal"

I would bet you see this car at their Arizona Auction in January 2011..

 

I agree, it may be in accordance with a set of rules that any particular auction entity has had their lawyers write up to be able to operate in their best interests (rather than that of the public-at-large or participants).

But, manipulation of values is not ethical.

Anyone can say "these are my rules and if you want to play in my sand box you have to follow them", but the smart money always finds out which entities run their game in the true spirit of an auction. An auction should be subject to no manipulation. None. Zero. That is the only way the public-at-large gets to know the true value of a car consigned at same, and the public deserves no less.

 

You don't even need one bidder...just the auctioneer. I believe the term is chandelier bidding.

 

Yes, that is correct...of lately the only Auction house's I find that is not doing this is R/M and Mechum.

Even Barrett-Jackson was doing it this last year and was very very obvious this last time at the Orange County fairgrounds show..

 

That's a horrible practice. What is the market value for this car? $250k?

 

and for a very nice one!

 

It is in California (and other states) but there are some "rules" that need to be followed.

CA Commerical Code section 2328 (4): If the auctioneer knowingly receives a bid on the seller’s behalf or the seller makes or procures such a bid, and notice has not been given that liberty for such bidding is reserved, the buyer may at his option avoid the sale or take the goods at the price of the last good faith bid prior to the completion of the sale.

Note that this does not cover shill bidding (3rd party) which would be fraudulent.

-mick

 

And this Code itself shows exactly why it is easy for an unethical auction house to (try to) manipulate values. It is nigh-on impossible to establish that the auctioneer is actually following the Code based on any existent seller or buyer action as described in the Code.

 

True but it is not legal for them to say Sold unless it is nor say it Sold when it didn't.

 

That I did not know...BUT I am pretty sure it did not sell as I WATCHED every movement..and there were no bids..and the guy that gets the sale order signed from the "winning" bidder...I watched as he went TO NO ONE to get it signed and they just went on to the next car being auctioned.

 

Every house shills. That's how we get $4 million dollar futureliners, $100,000 VW campers and $400,000 350 gt's. My sense is that Russo may have had a stake in the car so nothing wrong with selling it to yourself.

OK, maybe not "nothing". Bottom line is do your homework, don't partake from the bidders bar, bid responsibly, and when in doubt of what is happening, assume you are the fish.

 

It sounds like they all need about a 2 years of coverage by an undercover investigative journalist.

But magazine that everyone interested in cars reads would publish such an article?

Bob S.

 

Yes. I believe that is Drew"s car.

 

Correct, he does own the 350GT, it is his own car.

 

Maybe he bought it back?

 

At $440,000?

I don't think so.

 

Now there's a discussion I'd like to have in a calm, rational environment

 

I think that's exactly what happened, he just sold it to himself. He owns the car, he owns the auction house. This practice doesn't work very well for a "normal" consigner, but as the owner of the house, he gets the consigner's fee and the buyer's premium, so he isn't actually losing any money like a normal consigner would if they did this.

I was standing next to Roy, next to the car when it "sold". There definitely was NOT a buyer or even a bidder for this car.

I don't have any issues with the auction house bidding on behalf of the reserve for the consigner, but if the car doesn't meet the reserve and isn't actually sold, then I do have a problem with them announcing that the car has sold.

 

Thanks for the clarification.

I guess I didn't make it clear, but my point really is that the announcement that a motor vehicle sold to a new buying party for $440,000 is a complete fabrication, and a total manipulation of values. That's the bottom line. You and I both know this was down "on paper only" and there is no transfer of $440,000 US in clear funds that will ever occur to consummate this fake sale. You & I also know that this was done solely to manipulate values for the next time this hapless vehicle re-emerges from hiding to be presented to the unsuspecting public. There is nothing good about what happened here, and explain it away within the 'rules' as much as we can makes no difference - it stinks. The fact remains that most astute people would not give $200,000 less for this car, so I fail to see how little more than a fraud was perpetuated upon the public here.

BTW, considering the auction house I think we are speaking of, why am I not surprised?