www.mymaxbid.co.uk - A matrix site?

[redmist]

you have www.mymaxbid.co.uk in your list of matrix sites, but it isnt a matrix site!!!!

[mercinary]

From my initial look at the site, it does appear to be a legitimate auction service. I only took a quick glance at some of the FAQ though....so someone correct me if I am wrong.

It is VERY possible that this was a matrix site in the recent past, and they realized that matrix sites are fraudulent, and thus they changed their business model. The site would remain on our list until someone like you noticed the updated site. :) We see this happen all the time.

-Merc

[redmist]

hi,
ive been a member of this site since very near its creation, and i can promise you that it was never a matrix site :)

[mercinary]

I don't know what to tell you. I only offer what might have happened. Either me or another one of the administrators will take a look at the site in depth and remove it from the list as nessisary.

-Merc

[redmist]

ok :)

[sisco50]

Mymaxbid does not resemble a matrix site but is the weirdest auction site I have been to. There are a few kinks thrown in that totally turn me off to this site. Things like paying an Admin fee for each item you bid on. Having to take a quiz to win the item if you are high bidder. High bidder does not always win an item they high bid on. It must be a high UNIQUE bid in order to win.

Even tho it does not appear to be a matrix site I still wouldn't spend more than three minutes there. :(

[redmist]

its a pretty good site. the admin fee basically pays the cost of the gift, and the quiz is for legal reasons - lottery laws etc.

[sisco50]

I am a member of several auction sites and this was the first time I saw anything like that. My thought is that I personally wouldn't like to mess with it because I like things quick and simple. Some people may actually enjoy the extra kinks but I don't fit the bill. :)

[redmist]

lol....fair enough :)

[mercinary]

Bump!

Hey Jokach: Can you lay another set of eyes on this site? If it isn't a matrix site, lets get it off our list.

-Merc

[jokach]

I don't think it falls into the standard definition of a matrix site. Instead, it is an illegal lottery ...

The reason that it is an illegal lottery is because the owner is selling 'chances' (the admin fee) in order to win a gift. The whole auction concept behind the site isn't really an auction at all, its basically buying a chance to win something by paying a admin fee and trying to guess the best price for that item. In addition, there is no regulation over it, who is ensuring there is no cheating and who is monitoring the 'bids'? Exactly right, the owner of the site, so they are biased in providing a winner.

The difference between this site and something like eBay (which I know you are asking yourself), is the 'admin fee'. ebay, yahoo, etc do NOT require you to pay a fee to bid on an item. You can bid freely and the bidder does not pay any fee when they win the auction, the seller does. This is the way an auction works, don't let the 'auction' concept on that site mislead you.

I think that since its not specifically a matrix site, it is still a scam and it should stay.

Just my opinion.

[mercinary]

Ahhhh ok! Now it all seems to make sense. I guess I didn't get a good feel for how the site worked.

It will remain on the list. Thanks Jokach!

-Merc

[redmist]

sorry to be the idiot, but what does it mean when you bump a post?

it is not an illegal lottery, as, if im correct (and i think i am :) ) it is a raffle of sorts.
for a raffle to be a raffle and not a lottery, there must be some form of elimination, in this case (and most others) you have to answer questions to have a chance of winning. have you ever wondered why they ask you the easiest questions on TV when you call up to win a holiday or TV etc?
Its so that it makes it a raffle which you do not need a licence for, but if there were no questions, then you would require a licence as it would be a lottery.
the admin fee is just like buying a raffle ticket. you pay your £1 and you get your ticket, which in this case is a price (which you choose). the highest unique price is the winner.
i agree that the owner could set it up, but one has to hope that not everyone in this world is totally set on ripping others off.
hope it makes sense!

[mercinary]

Redmist: You should read up on lottery/raffle laws. Those who hold them have to make VERY certain that they are upholding the laws of each and every state. Vermont (and several other states) have strict laws against having to pay anything for a chance at anything. That law is the reason that any sweepstakes you see says "no purchase nessesary". I'm not versed in the entirety of that law, but it was just an example of how a single state's laws can have a huge legal impact on a business owner.

-Merc

P.S. Bump just means "Bump this thread to the top of the forum by posting in it".

[jokach]

Redmist

Take a look at the facts as stated by the Lotteries and Amusements Act 1976 (thats UK law):


Definition of a lottery

There is no legal definition of a lottery although it is generally held to be a distribution of prizes by lot or chance where entry is secured by the payment of a stake.

The general rule is that lotteries cannot be run for private or commercial gain.

Different types of lottery and who can run them

Small lotteries:

Section 3 of the 1976 Act permits the holding of lotteries as incidental features of other entertainment, such as dinners, fetes, bazaars or sporting events. Proceeds must be devoted to purposes other than private gain. Tickets can only be sold on the premises and during the entertainment, and no more than £250 can be appropriated for expenses incurred by operators in purchasing prizes. No money prizes can be awarded.

Private lotteries:

Section 4 of the 1976 Act permits private lotteries in which the sale of tickets is restricted to members of a society established and conducted for purposes not connected with gaming, betting and lotteries and any other person on the society's premises; or to persons all of whom work or reside on the same premises. The proceeds of the lottery must be devoted to the provision of prizes, or to the purposes of society, or both.

Society lotteries:

Section 5 of the 1976 Act permits lotteries run by societies established and conducted for charitable, sporting, cultural or similar voluntary purposes. They must be registered with the local authority (or the Gaming Board in the case of large lotteries) and all proceeds must go to a scheme approved by the society.

Local Authority lotteries:

Section 6 of the 1976 Act permits lotteries conducted by local authorities.

Registration requirements

There are no registration requirements for lotteries covered by sections 3 and 4 of the 1976 Act.

Any society lottery wishing to promote a lottery in accordance with Section 5, must itself be registered with either the appropriate local registrations authority (in England, usually a district council) or the Gaming Board.

A society lottery must register with the Gaming Board if the total value of tickets to be put on sale in any lottery is to exceed £20,000, or if the value of tickets to be put on sale in any lottery, added to the value of those already sold during the same calendar year, is to exceed £250,000.

All Section 6 Lotteries (Local Authority lotteries) require Gaming Board registration.

Under no circumstances may steps be taken to promote a lottery under a scheme submitted to the Board and until notification has been given that the society has been registered.

Ticket prices and prize limits

Lottery tickets may not be sold to persons under 16 years of age and all tickets must be paid for before they are entered into the draw.

The price for a ticket for a Society's lottery or a local authority lottery must not exceed £2, and there is a limit on proceeds of £2 million for single lottery or £10 million for all lotteries in calendar year.

The limit on prizes is £25,000 for a single prize, or 10% of the proceeds whichever is higher. Not more than 55% of proceeds may be used for prizes.

With regard to expenses limits, up to 35% of proceeds may be used for expenses (Gaming Board authorisation may be required in some circumstances).

The combined prizes and expenses limit is, therefore, 80% of the lottery's proceeds, preserving 20% of the lottery's proceeds for the good cause.


The act above can be found at: http://www.hmso.gov.uk/

Since there is a payment of a 'stake' on this website (again, the admin fee), it needs to fall within these guidelines, which as far as I can see it does not (take note of the percentages for profits, for ticket price maximums, etc). The biggest one being that it needs to be registered in order to function the way that it is.

That makes it an illegal lottery.

jokach

[redmist]

very good ;)

[avago181]

I have spoken with an inspector from the gaming board of Great Britain and he informed me that this type of site is known as a reverse auction site. Lawyers from the board are currently looking into the legality of such sites. With regards to mymaxbid, the inspector does not think a legal challenge would be successful as you have to answer 3 questions. This makes it a skill game which is not illegal(in UK), even though they give you the answers.

[redmist]

could you ask the inspector whether if a similar practice were used on a matrix site,, i.e. they pay £20 for a signal booster, then have to answer 3 questions to be added onto the list,, it would make a matrix site legal?

[avago181]

A matrix site is not an auction site and in no way could one be classed as such. I would doubt very much that it would make a matrix site legit.

[jokach]

posted from:
http://www.culture.gov.uk/gambling_and_racing/fact_sheets/fact_prize_competitions.htm


The legal position if I have a prize competition and then enter all the correct entries of a prize competition into a draw

It is not possible to say how the law would apply in particular cases. It is possible, however, that a court could decide that the chance element contained in the draw would qualify that part of the competition as an illegal lottery.

The most recent cases of relevance in this area are R v Interactive Telephone services (the telemillion case) and Strong v Adair. These cases and others are described in some detail in the Law on Betting and Gaming by Smith and Monkham.

Care has to be exercised where a competition requires participants to answer one or more questions which most of the applicants will get right and where the names are then put in a draw to decide the winner. A court may well decide that this is an illegal competition and an illegal lottery.

Future changes to the law

Tessa Jowell announced on 12 June 2003 plans to ensure that there is a clear distinction between lotteries and prize competitions. The key aim will be to protect lotteries that collect money for good causes, such as the National Lottery and charity lotteries. Where it is clear that payment is required for entry and the result depends completely on chance, good cause lotteries alone will be allowed. Purely commercial lotteries will be deemed unlawful.

If a competition is run for gain then it must involve a degree of skill or knowledge to secure a prize, or offer a genuine free entry route to participants. Many prize competitions and prize draws currently employ so-called free entry routes. But in reality they do not involve the exercise of genuine skill and require the participant to make a payment, such as by a premium rate telephone call.

Ministers in DCMS remain committed to the introduction of a Gambling Bill as early as possible during 2004. The exact timing of that introduction will depend on the availability of Parliamentary time.


I got this quote as an extension of what I posted above, and it goes into some of what is being said about answering questions. It appears that these types of things might have to be viewed on a case by case basis (thats what I got from it at least). I just can't think that it would be legal in the UK to run this type of unregulated contest, just by answering 3 questions where the answer is given to you in the description. Maybe this is where US and UK law differs, but it just doesn't seem right.:eek:

I also agree with avago181 that a matrix site is not an auction site, it appears redmist is trying to do anything to get matrix sites appear legal.

[redmist]

im trying to find out if there is anyway that a matrix could be defined as legal (even though at present in the UK they are).