Bad Experience with Heritage Fun Auction

Windycity

In the recent Platinum Auction at the Fun Show, I was bidding on a fairly expensive lot. Closely following the online bidding I upped my "maximum" to stay in the race. The lot clearly stated no reserve and confirmed that I was the high bidder. The morning after the auction, I went online to check the result and the lot was listed as "not sold". I called Heritage immediately and they confirmed that I was in fact the high bidder and had won the lot. The following Monday, I checked again with one of the higher level executives and he told me the lot did not sell due to an error on their part of not properly listing the client's reserve. He claimed the client reserve was much higher than my bid and the lot was not sold. He appologized for the error but I lost the lot.

I find this type of action on the part of the largest coin auction house disturbing. If they truly made an error in not putting in the proper reserve, they should cover the difference making the consigner whole and keeping the buyer, who followed the "rules" closely, happy.

I remain very suspicious of the way the auctions work and have lost confidence in Heritage. My future sales will be through other companies.

Pat

RBinTex

Contact Greg

AKrick

It's hard to believe that Heritage or the consignee didn't notice this error in the weeks leading up to the floor auction. Very suspicious and disturbing.

Bochiman

Kind of like the thread where someone mentioned he had won the coin then the seller changed their mind????

dpoole

I can understand errors happening, but this is the sort of thing that undermines credibility for the whole enterprise. I know consignors are calculating about reserves. Auction houses are generally motivated to keep them at levels that allow for successful auctions, but obviously there are exceptions.

Yet clearly when the hammer falls, the auction should be honored as advertised and as it stands. If some error was made, the winning bidder should be the last to pay the price for it, not the first. Otherwise, we suspect a rigged game and we experience a loss of confidence, as is already apparent on this thread.

DMWJR

I agree with you dpoole.

Just FYI, I am aware that right now Heritage sold some coins that they weren't supposed to (while not admitting liability). They are going around to the people who won the coins, and offering them double the hammer to buy the coins back for the original owner. I thought that was nice to know.

RegistryCoin

The much sought after trust desired by the auction house goes out the window for the actual and the proposed situations previously mentioned, imho.

Russ

This is the third report of this scenario so far.

Russ, NCNE

jpkinla

Very interesting because this happened to me during the Platinum night auction as well. I bought a $5 Indian 1913 at $11k hammer and was told later the reserve was not entered and that I didn't get the lot. I WAS A FLOOR BIDDER NO LESS AND BOUGHT IT ON THE FLOOR! The right thing to do would have been pay the consignor his $14k reserve and allow me to buy the lot at the hammer price. If the auction house eats a few thousand dollars here and there after selling 30 million plus, don't you think it is good business to keep the customers happy both consignors and buyers? I am sure errors do occur but in my business when one of my employees make a mistake, my company makes it right.

I don't really care that much about the one lot but I found this to be highly strange and particularly now that I know it wasn't an isolated incident.

My $10 Indian GoldRegistry Set

morgannut2

No they aren't damaged to the extent of $4,000. But, I have had at least 10 significant problems with Heritage in the last year and I'm finished dealing with them. A mistake is one thing, IMHO Heritage is incompetent. Examples? Double charged once, horrible pictures of a toned coin costing me a ton of $ , a coin "sold" at 2 increments higher than my reserve but not sold (offer to sell "next time"), a coin with my winning bid shown in green on "my bids", no reserve-- but no saled to me, coins taking 5 weeks to arrive, etc. etc. I'm feed up with their games, mistakes, and possible insider favoritism.

dpoole

<< <i>Should the winning bidder automatically be awarded the lot at $6000 and the consignor automatically receive $10,000 from the auction house? >>



You posit the auction house as the one making the error. How could the proper and "fair" outcome be otherwise?

michael

interesting observations.................................................

i have heard many of these same comments on here from my good collector friends in western ny state dealing with previous dealings this past year with this company


michael

zkcoins

Hmmm. Not so good.
Zach

Keyrock

What about all of the leagal mumbo jumbo regarding contacts. Isn't it a legally binding contract when you submitt the bid? You sign a contract to consign the coins so the seller is protected. I think if push came to shove and legal action was pursued the issue would be resolved.

If the auction house want to play the game of soliciting bids then they better make da*mn sure their people are entering the correct reserves and updating the auction venue as needed. In the example given, I would say the bidder gets it at his bid, the conisgner gets their reserve and Heritage eats the balance. Until they address the issue they will be screwing both consigners and bidders. Assume at LB your looking at two coins with funds for only one. Lets say greysheet at 10K for each coin and you have a bid of 11.5K on the first one with no reserve posted. You think you have lot 274 because the floor biding closes and your top dog. Nothing like finding out later that you should have bid on lot 679, because the auction house messed up and the lot did not sell because the reserve was at 13K.

As i've upgraded, I've played the game of no reserves on Ebay, as many people here have. Some days you get the bear and some days the bear gets you.

Rich

dpoole

<< <i>David, since that was such an easy one for you, would it matter if it were the consignor's error instead? >>



Then the bidder gets the coin, the consignor gets his percentage, the house gets their percentage. Consignor loses.

Gimme a hard one!

braddick

On a smaller scale: You're selling a coin on eBay that cost you $1,000.00. It sells for a final bid of $600.00. Do you not honor the closing price because you didn't place a reserve on your auction?

I believe the right thing for Heritage to do is honor the closing price and eat the difference. Somehow, someway I get they'll make it up in the long run...

The word of mouth will kill them if they don't and the positive feelings they demonstrate will benefit them in the long run.

LeeG

Once an item is paid for, it's a "Done Deal". Until that point, options are available to all involved. Lee

CalGold

What's the beef here? The owner wanted a minimum price. The reserve was not met. The coin did not sell. Heritage mistakenly told you that you won, but in reality you didn't--so what. How are you harmed? If you want the item for the reserve price offer it up to Heritage so they can contact the consignor. If not, go on with your life.

There were several thousand lots in the sale. I'd be surprised if there were no mistakes in an auction of that size.

CG

jpkinla

That's exactly why it really is no big deal to me. I could have paid the reserve price and owned the coin and I hadn't yet PAID for the coin so there was no harm no foul. I wasn't happy but so what.....On to the next one.....

My $5 Indian Gold Registry Set

marcmoish

What's the beef here? The owner wanted a minimum price. The reserve was not met. The coin did not sell. Heritage mistakenly told you that you won, but in reality you didn't--so what. How are you harmed? If you want the item for the reserve price offer it up to Heritage so they can contact the consignor. If not, go on with your life.

ditto CG

There were several thousand lots in the sale. I'd be surprised if there were no mistakes in an auction of that size.

ditto ditto




marc

dpoole

<< <i>Or, might it be ok to ask the auctioneer to show mercy and re-open the lot? And, if the lot is re-opened and sells for less, do YOU owe the consignor the difference in price? >>



Of COURSE I'd expect the auctioneer to show mercy, if it happened to ME.

Seriously, though. You hadn't spoken of "mercy." Naturally, people can call people and explain things, hoping that someone will be civil about it. One hopes most people would be.

In the presenting example, though, nobody asked the winning bidder to voluntarily relinquish his right to the coin, under the circumstances. Instead, he was presented with an apology and a fait accompli.

My point is that the auction company is better off to follow the rules they set, if they hope to maintain trust in the marketplace and dispell suspicions that winners are winners only if it coincides with the convenience and purposes of the consignor and/or the auction house. The auction company is better off to acknowledge those rules, and then ask and or offer incentives for exceptions to the rules, rather than to change the rules around on people.

It is good to know that many of you would take such a request in stride and grant it. Frankly, I would too, most of the time. But the question here really has to do with how an auction house should manage their auctioning procedures.

leothelyon

<< <i>
I remain very suspicious of the way the auctions work and have lost confidence in Heritage. My future sales will be through other companies.

Pat >>



What makes you think the other companies won't do the same thing? The fine print defines if there are errors in the auction. A reserve is usually the lowest the seller would accept. Had the correct reserve been in place, it may have been met, went higher or the lot may not have sold. But I do agree, it's frustrating and perhaps something along a 10% deduction award on the next lot you win would be appropriate. Because what if you were looking at two lots and you lose out on both, that sucks!
If someone can post Heritage's mailing address, I would ask for the 10% everyone!

Leo

DennisH

Heritage charges fees from both buyers and sellers – fees that allow them to provide a professional service, cover costs, and make a proifit.

Costs include screwing up and not logging in a reserve.

Windycity

I run a business and when we fail to deliver on a contract or agreement, we make good for the client. If our business was the coin auction business our response in a situation like this would be to sell the lot to the high bidder, pay the consigner the reserve amount, eat the cost of our mistake, and then hold our management accountable to improve our quality controls and systems. Business 101.

The Heritage quality controls are terrible. One year ago I sold the bulk of my Washington Quarter registry set with Heritage at the Fun Show. They made numerous errors (I will spare you the details) and then OVER PAID me by nearly $40,000! I called them, alerted them to the over payment, asked for a corrected invoice and offered to send the money back as soon as the corrected invoice arrived. I emailed them again on two separate occasions asking for a corrected invoice. They did nothing for more the 5 months. I finally called a top level executive and explained the story and he finally got it all straitened out, sent me the invoice and I returned the over payment. I'm not certain they would ever have caught the error had I not followed through.

This is not how you run a multi-million dollar corporation.

Pat

marcalan84

I agree with dpoole's earlier suggestions. The auction house in my opinion....always "eat it"....if it is their error and they don't catch it prior to the hammer coming down. I work as a Financial Consultant. FC's make errors every so often when entering an order on the computer. Sometimes (specially on an options trade....where 1 contract = 100 shares) an error is for tens of thousands of $$. Guess what?? In my business....my company doesn't cover it....and the client doesn't cover it. It comes out of our net pay if it is our error...or we misunderstood the client. I have even had to eat a clients error....when he entered the order online...and then called and asked me to sell the same lot!! Wasn't my fault...but since it is my client...I had to pay. In my business....occasionally "backing" out a trade made in error....turns out to be a profit....and in that case the company keeps 100%...and we don't even get to bank it to offset future errors. So....I for one....have absolutely zero compassion for the auction house. I have some for the consignor who asked for a reserve be placed....and wasn't followed thru on by the auction house. I have the most compassion for the poor guy who placed a "would be" winning bid! No Grey area for me.....the Auction House should absolutely cough up the $$ if it is their error. They are supposed to be professionals at what they do. I am in my profession....DPoole is in his...and that is probably why we feel the way we do. No passing the buck on this one. Sorry that I feel so strongly...but I am so tired of the bleeding hearts that always feel sorry for the ones who DID WRONG....instead of the party that WAS WRONGED!!

Steve

Pat, it sounds to me that you are a significant customer of Heritage. You are upset with how they handled the overpayment last year and how they handled this current Fun auction mess. Why not contact the executive you dealt with a few months ago and get a clear understanding of what happened and how Heritage can make you feel better about their company. You will feel better and maybe it will help Heritage to do better in the future. JMHO. Steve


P.S. I'm sure the board members would like to hear what the executive says.

Windycity

Steve,

The high level executive in both cases is the same person. They will not remedy the situation and have made it clear that if I want to purchase the lot I will have to watch for it in future auctions.

I welcome knowing more about others experiences with other auction houses... I need to find a new firm to work with.

Pat

CalGold

<< <i> run a business and when we fail to deliver on a contract or agreement, we make good for the client. >>





<< <i>I have the most compassion for the poor guy who placed a "would be" winning bid >>



Ya'll are just not getting it. First, the auction house's primary duty is to the consignor. The auction house is his agent, not the agent of the buyer. If the consignor sets a reserve, the auction house has no authority to sell the coin for less. Likewise the house has no duty to the high bidder whose bid is below reserve to pay the difference so that the high bidder can buy a coin below reserve at the auction house's expense.

Lets say you call your stock broker and put in a limit order to buy 100 shares of ABC company at $50 per share. The stock never trades for less than $55; but your broker erroneously sends you a confirmation of a fill on your order, then sends you a correction showing that the order was not filled since the stock never traded at your limit order price. Would you expect your broker to pay the difference and buy the stock for you? I think not. If you want the stock, you need to pony up the market price, namely $55.

CG

Windycity

CG,

I disagree... I am highly suspicious that games are being played with the reserves. When I have auctioned my own coins in the past, Heritage has pushed hard for no reserves or low reserves with the rationale that this generates more bidding and results in higher prices. They pay very close attention to reserves and I find it hard to imaging that a reserve of more than $30,000 was not registered. I also find it unusual that a consignor wouldn't have been tracking it online and seeing the "no reserve" and my "high bid." I can give no more proof of misdeeds but I remain highly suspicious.

Pat

Steve

<< <i>Steve,

The high level executive in both cases is the same person. They will not remedy the situation and have made it clear that if I want to purchase the lot I will have to watch for it in future auctions.

I welcome knowing more about others experiences with other auction houses... I need to find a new firm to work with.

Pat >>



Pat, it amazes me that this executive, realizing you are a customer who has spent significant money with them and also "gave" them back $40k would act the way he did on this deal. If the consignor wanted to keep his coin rather than accept the reserve money, Heritage could have at least given you something as compensation. If the consignor was willing to accept the reserve money, Heritage should have given you the coin at your bid price and eaten the difference. Something is very wrong here. Steve

marcalan84

CG- Your stock trade analysis is off the mark. In the case where the stock was erroneosly purchased by the broker...it is his/her error...and they will then have to sell the stock on the open market and eat the $$ amount of the error (out of their net salary). Shouldn't the auction house also have to eat the $$ amount of the error .......if it is their error?? Nobody said the consignor (same as the client of the stock broker) should suffer monetary damages if their reserve was not properly registered. How do you know the high bidder wouldn't have bid higher if he/she had known what the reserve was (this is really irrelevant though). Again...the hammer fell...the high bid was registered on a "NO RESERVE" auction lot...and the bidder SHOULD GET THE COIN. The auction house is a BIG BUSINESS...and sometimes companies make mistakes and have to step up to the plate to make their customers happy! Yes ....their main customer is the consignor...but the bidder is also a client (see 15% commission paid)...and without the large base of bidders that they need to keep happy...there will not be any consignors.

CalGold

<< <i>Your stock trade analysis is off the mark. In the case where the stock was erroneosly purchased by the broker...it is his/her error...and they will then have to sell the stock on the open market and eat the $$ amount of the error (out of their net salary). >>



No, my analogy is right on point, but yours is not. Your analogy would apply had the bidder gotten the coin at a price below reserve--in which case the auction house would have had to pay the difference to the seller. But here no party was damaged because the sale was not consummated, since the reserve was not met. As I said in my first post, if the bidder wants the coin at the reserve price he should contact Heritage and see if they will relay that offer to the consignor--of course the parties would have to work out Heritage's commission in that case.

It seems that a lot of people want to live in a perfect world and would impose financial penalties on those who err even when no financial damage has been incurred. I guess I just do not agree with those who think that way. Nor do I believe that an auction company should subsidize a buyer's purchases (and paying the difference between the bid and the reserve would be just that) just because the buyer does business with the house.

CG

marcalan84

CG- In my opinion you are still off the mark. Your analogy doesn't even come close in my opinion. The only thing I agree with you on is if there was a RESERVE. Phantom reserves do not count. How was the Auction House wronged in any way?? They weren't!! In this world that we live in........I can give you literally thousands of examples every day where incompetence will cost you...one way or another. Sometimes I feel bad for the incompetent...i.e. an uneducated person gets taken advantage of...or someone of a lower IQ..etc. In this case we are talking about a company acting/performing like professionals in the field they choose to run a business in. If you make a mistake that was/should be within your means to ensure it doesn't happen...then YES YES YES...you absolutely should have to pay for it....when you have wronged another individual thru your incompentence. In the medical field it is known as mal-practice...and medical professionals have insurance to reimburse the party who has been wronged/injured thru incompetence or a mistake. If your surgeon makes a mistake and it costs the life of a loved one....will you be so quick to jump to the side of someone who makes an error.....or should everyone be allowed to walk away from their mistakes/sloppiness in their job....and just chalk it up to "EVERYONE MAKES MISTAKES"..and they shouldn't have to take responsibility for it. Sorry CG....all I can say is you must be a liberal. I can't side with anyone unwilling to take accountability for the mistakes they make...and not impose on others for them.

CalGold

<< <i>you absolutely should have to pay for it....when you have wronged another individual thru your incompentence. In the medical field it is known as mal-practice...and medical professionals have insurance to reimburse the party who has been wronged/injured thru incompetence or a mistake >>



In our legal system doctors, lawyers etc do not payout money for their mistakes unless someone is injured. Who was wronged here? Or to put it another way, who was injured or damaged? The bidder? How? All that happened is that he did not get to buy a coin at a price less than the seller was willing to accept. The bidder walked away feeling disappointed but with his money in his pocket. He can still buy the coin if he wants -- all he has to do is ante up the price the seller wants for it. So far he hasn't done that. For all we know he was trying to rip the coin at a low bal bid--at least that's what the seller might think since he set a reserve higher than the bidder offered.


CG

Windycity

This is an intelligent debate. But the final result is that I will not use Heritage for future auctions. I have used them three separate times to auction off important collections including such rarities as a 1918/17 Buffalo MS 64, 1943 copper cent, Judd 63 Gobrecht dollar - one of 3 known examples. No more. Here's an example of a coin they will not auction for me when the day comes to sell.

marcalan84

CG- You might think I don't see or get your point. On the contrary........I understand exactly your point and you have argued it well. Unfortunately I see it alot like I would view a car dealer pulling a bait and switch (which is illegal). You agree to a deal...and then (after the fact).....they (THE AUCTION HOUSE) change the price on you (after the hammer fell)...and after THEY REALIZE THEY MESSED UP. SO Sorry!! What would the auction house do if I as the consignor said AFTER THE FACT....that the coin sold for too low of a price (has happened to me)....and I now wanted to put a reserve on it and cancel the high bidder out...and I would have plenty of reason for having wanted to do this...since they put alot of pressure on me to not place any reserves on my coins. I would be told SO SORRY...TOO BAD. I think we all have to realize that the Auction House is a large company which can't afford to lose good clients because of their incompetence...by alienating their bidder base and getting bad PR out of it. Bottom line for me is easy. It is something that I see this country losing a grip on. It is called ACCOUNTABILITY. Come on people.......we all make mistakes....and CG...it may not have cost the bidder any $$ as you said...since the deal didn't go down....but not all mistakes can be measured by $$ alone.

Windy City- Nice coin!!! How about letting me auction that baby for you?? I will only want/require a 10% buyers fee and no sellers fee. I will be sure to register the proper "reserve" that you require.

itsnotjustme

I just sent this thread to Heritage. We will see if they reply.

RAD

No, my analogy is right on point, but yours is not. Your analogy would apply had the bidder gotten the coin at a price below reserve--in which case the auction house would have had to pay the difference to the seller. But here no party was damaged because the sale was not consummated, since the reserve was not met.

I tend to agree Cal....

CalGold

Hey Windcity, if you keep posting pictures of coins like that we are going to have to revive the rusty washer rule--no posting coins that make the rest of ours look like rusty washers.

CG

marcalan84

Rad- I agree with you only if a RESERVE WAS PLACED!! After all.......just because a reserve was requested...does not necessarily mean a reserve was in place at the time of the auction bidding. If we allow the auction house to put in a reserve AFTER the bidding has been completed (and therefore the sale should be binding since there WAS NOT A RESERVE IN PLACE) then don't we run the risk of them playing favorites to an IMPORTANT consignor...and we allow them to go to any bidder after the fact and say "So sorry...but we forgot to place the reserve that was requested by the consignor" when they (the auction house or consignor) decide they should have got more $$ for the lot??? We have rules to play by...and in this case the professionals who run their business....need to run it in such a way as to eliminate any/all mistakes. When mistakes do happen (and they will)...and it is their fault (thru negligence, haste, failure to double check all reserves before the auction....and oh what about doing what they are paid to do..as in their job...etc).....they should step up to the plate...and make good on it. Not because the bidder has been "wronged" (at least not in everyones eyes)....but because it is the RIGHT THING to do....and doing the right thing is known as "Good Business Practice" and will always increase your future business...as you will be seen as a professional business entity who treats all of its clients as they themselves would want/expect to be treated.

cdan12

I had 3 coins in the Dallas sale that did not reach reserve,there was no mention of a reserve in the listings,the bid came within 17 dollars of the reserve on one coin(bid was 1133,reserve was 1150) and no one is happy,me because I had to buy back the coin and the bidder who might of bid $17 more to own it.There was a similar situation on the other 2. Edited to add, I will not use Heritage in the future.

bushmaster8

Marcalan84... you've got the cat by the tail!

marcalan84

Bushmaster- I guess I do........but I'm givin' the cat one helluva ride!!

lloydmincy

Very Interesting, but here is MY POINT:

We do not know what the agreement/communications between the consignor and Heritage was regarding the reserve. A phone call message not passed on, misunderstanding on reserve price, whatever. BUT...

Heritage ALWAYS posts what the reserve of a coin is usually a week before the floor bidding. We all know what the lot will say... NEXT BID MEETS RESERVE or RESERVE MET. If the "reserve" is posted a week in advance, WHY DIDN'T THE CONSIGNOR NOTICE THAT THERE WAS NO POSTING OF THE RESERVE??? Without all the information for this "trial", I dont know who is at fault. Don't tell me the consignor wasn't checking his lots before the floor bidding.... If he wasnt, strange. If he was, he should have notified Heritage IMMEDIATELY that he saw no sign of his reserve posting. And if he then notified Heritage, and they didnt do anything about it in time, it is Heritage's fault. Otherwise, it is the consignor's fault, IMO.

Another part of the puzzle is this: How leniant are the auction houses for you wanting to post a reserve or not??? Are some consignors waiting to see the Internet bidding, and THEN deciding if they want to post a reserve? Doesnt a coin seem more in demand if the listing says RESEREVE MET vs. a much higher NEXT BID MEETS RESERVE ??? The consignor should not be allowed to play the "last second" reserve game, (if they could do this).

I know the auction houses contract rules favor them and are vague at best, but I think based on the given info:

The buyer should get the coin no matter what. If the consignor forgot to place a reserve, or DIDNT CHECK ON HIS LOTS (internet) PRIOR TO THE FLOOR, he eats the loss. If the auction house was supposed to place a reserve, and forgot or didnt, they eat the loss.

It should NOT be allowed for the consignor to say he wanted a reserve after any lot has sold. I trust this never happens.

-----Lloyd

P. S. By the way, heritage has been great with me. If I want a reserve, or a change, it hapens IMMEDIATELY.

P. S. S. Pat, after all that work on wanting to send back the $40,000, maybe someone was telling you something that you should be compensated for a mishap in the future!!!

SethChandler

Forget Heritage...tell us about the 1892 Monster Morgan!!!! PR68DCAM?

DMWJR

Shylock, wasn't that your thread last year with the fantasy pieces on it? I couldn't remember who did it so I couldn't give proper credit. I liked the reverse as well.

Windycity

SEth,

Yes... Proof 68 DCAM - part of a 1892 proof set. Check the registry sets to see the other coins in the set... all nearly as nice.

Pat

coolkarma

<< <i>SEth,

Yes... Proof 68 DCAM - part of a 1892 proof set. Check the registry sets to see the other coins in the set... all nearly as nice.

Pat >>



Columbian Expo Set Incredible set and of historical significance. Any additional special, personal significance?

Windycity

Seth,

When I saw the set, it was like nothing I had ever seen before and I bought it that day... very little haggling. Have had it about 3 years and I go visit it at the bank every once in a while. Prettier to the eye than in the pictures.

Pat

monsterman

well i can assure you its not a plot to screw anybody...but it is a mistake...there is a lot of paper work that has to be done to pull off an auction and several employees are involved....AND ALL EMPLOYEES MAKE MISTAKES....if i shot all my employees who made mistakes they`d all be dead....if i hired rocket scientists my prices would have to triple...so where do we go from here

triple fees or dead employees

monsterman

ps...naturally nobody on this board makes mistakes thus they arent employees....thus they are all employers...isnt that inductive reasoning???

RYK

Very interesting discussion...

Hearing about all of these problems at Heritage give me pause. One would like to think that the auction process is foolproof, but mistakes can happen anywhere. Perhaps, Heritage bit off more than it could chew with the 11,000 lots offered at FUN. These errors, in my opinion, undermine the integrity of the bidding process. Error should be corrected before the hammer falls. If the reserve is erroneously omitted, it could be announced on the floor at the time of the auction. The website should not indicate a coin was won when it was not. (etc., etc.)

As a potential consigner, I can see the value of using a smaller operation (like ANR) where the coins seem to get more attention, higher quality photography, and just as high collector/investor/dealer interest in the auctions as the Heritage auctions. I have not read a single report of a snafu at ANR since they started.