Bidding agents that perpetrate auction fraud

Trevathan, Jarrod, McCabe, Alan, and Read, Wayne (2008) Bidding agents that perpetrate auction fraud. In: Filipe, Joaquim, and Obaidat, Mohammad S., (eds.) E-Business and Telecommunications Networks: communications in computer and information science. Communications in Computer and Information Science, 23 . Springer, Berlin, Germany, pp. 57-71.

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This paper presents a software bidding agent that inserts fake bids on the seller’s behalf to inflate an auction’s price. This behaviour is referred to as shill bidding. Shill bidding is strictly prohibited by online auctioneers, as it defrauds unsuspecting buyers by forcing them to pay more for the item. The malicious bidding agent was constructed to aid in developing shill detection techniques. We have previously documented a simple shill bidding agent that incrementally increases the auction price until it reaches the desired profit target, or it becomes too risky to continue bidding. This paper presents an adaptive shill bidding agent which when used over a series of auctions with substitutable items, can revise its strategy based on bidding behaviour in past auctions. The adaptive agent applies a novel prediction technique referred to as the Extremum Consistency (EC)algorithm, to determine the optimal price to aspire for. The EC algorithm has successfully been used in handwritten signature verification for determining the maximum and minimum values in an input stream. The agent’s ability to inflate the price has been tested in a simulated marketplace and experimental results are presented.

Item ID: 7344
Item Type: Book Chapter (Research - B1)
ISBN: 978-3-540-88653-2
ISSN: 1865-0929
Keywords: online auctions; artificial intelligence; software bidding agents; shill bidding; bid sniping; extrema avoidance
Date Deposited: 20 Jan 2010 05:17
FoR Codes: 08 INFORMATION AND COMPUTING SCIENCES > 0804 Data Format > 080499 Data Format not elsewhere classified @ 100%
SEO Codes: 89 INFORMATION AND COMMUNICATION SERVICES > 8999 Other Information and Communication Services > 899999 Information and Communication Services not elsewhere classified @ 100%
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