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‘Penny Auction’ Websites Generating Complaints

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Zbiddy.com is a "penny auction" website that costs considerably more than a penny to use. (CBS)

Zbiddy.com is a “penny auction” website that costs considerably more than a penny to use. (CBS)

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CHICAGO (CBS) – An iPad for $40, a Kindle for $20 — those are the kind of bargains penny auction websites are promising this Christmas season.

But the Better Business Bureau says complaints against the companies in the Chicago area are up more than 400 percent.

CBS 2’s Dorothy Tucker reports.

Penny auctions are really gambling sites. Because they’re called penny auctions it sounds like each time you bid it’s only costing you a penny.

But actually, you pay for each “penny” bid — about 60 or 70 cents, depending on the website.

What that means is that you can end up paying more for an item than you think, and you probably won’t even win it.

Some people find it an exciting game. But some others feel they’re being misled.

“I feel like I was taken advantage of. I’m very upset,” one viewer told Tucker.

His anger is aimed at a penny auction site called Zbiddy.com. He doesn’t want to be identified because he’s embarrassed he lost $99. He says when he put in his credit card he didn’t know he was buying bids. He calls the website misleading.

“I thought it was a credit card that was provided for later use. If I were to decide to buy something my credit card would be on account,” he said.

It’s a growing problem, one consumer watchdog says.

“There are more and more of these sites each and every week, it seems to be. They can be here in America, they can be in Third World companies,”  Steve Bernas, president and chief executive officer of the Better Business Bureau, said.

Like many people, the CBS 2 viewer was attracted to the unbelievable prices the sites claim to have sold. What made the zbiddy.com site even more appealing? It looked like CBS was endorsing penny auctions.

“I said if it’s good enough for you, how bad can it be,” the viewer said.

On the front page of company’s site was an unauthorized, re-edited story that CBS 2 did on penny auctions back in April. Left out of the butchered version was information about the difficulty of winning a hot item.

After seeing the original report, the viewer says, “I was just amazed how they manipulated your report to make this whole thing work for them.”

A Zbiddy operator dismissed accusations that the website is misleading. He says customers just need to “read everything.”

A vice president of the company did not return phone calls regarding the doctored CBS 2 report.

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