ISSN : 1796-203X
Volume : 2    Issue : 10    Date : December 2007

Investigating Shill Bidding Behaviour Involving Colluding Bidders
Jarrod Trevathan and Wayne Read
Page(s): 63-75
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Shill bidding is where spurious bids are introduced into an auction to drive up the final price for the
seller, thereby defrauding legitimate bidders. Trevathan and Read presented an algorithm to detect
the presence of shill bidding in online auctions. The algorithm observes bidding patterns over a
series of auctions, and gives each bidder a shill score to indicate the likelihood that they are
engaging in shill behaviour. While the algorithm is able to accurately identify those with suspicious
behaviour, it is designed for the instance where there is only one shill bidder. However, there are
situations where there may be two or more shill bidders working in collusion with each other.
Colluding shill bidders are able to engage in more sophisticated strategies that are harder to
detect. This paper proposes a method for detecting colluding shill bidders, which is referred to as
the collusion score. The collusion score, either detects a colluding group, or forces the colluders to
act individually like a single shill, in which case they are detected by the shill score algorithm. The
collusion score has been tested on simulated auction data and is able to successfully identify
colluding shill bidders.

Index Terms
Auction fraud, shill bidding, reputation system, colluding bidders, bidding agents, graph theory