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Buyers fraud, does it exist?


priya

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I think it's easy to point a finger at a sellers misrepresentation and call it a fraud but what about buyers fraud, does it exist?

You're at an antique show and the vendor is selling a violin, not sure what to ask for the violin, the vendor asks 'what do you think it's worth?'

(lets say it's a nice 1920's Roth in good shape)

What is it worth?

If the vendor was hoping for $200 and got $300 from you,

was that a buyers fraud?

If a seller stumbles into your shop with a violin that was inherited and has no idea as to the value do you ask them "What are you looking for"? Without giving an inkling as to the true value. Is that a buyers fraud?

If the Roth vendor asks for $200 and you cut them down to to $140 by reciting vague condition problems...it's gonna need a complete set up, do you know what they charge for a new bridge nowadays? Is that a buyers fraud?

Are ethics only for sellers?

Is it only fraud when you think you paid more than it's worth?

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I assume the most famous case is that of the Betts Stradivari, with the customer leaving the shop with his 1 GBP(or was it 5) thinking he`d struck a great deal.

I think if your in a position of being a dealer with a shop you have an obligation to be honest ,but it doesn`t always happen like that.

Its certainly not a way of getting customers if you plan on ripping everyone who walks into the shop with a violin.Word would soon get around.

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There is no "fraud" involved, it is a free will decision?

No one forces you to buy or sell (a violin). Except medication, I need the medication to survive, which is no choice. Or I stranded in a desert, you ask me to pay large sum of money for a ride (to get out of danger be killed by heat) etc.. /yuen/

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Yes i can imagine, the guy said to Betts `Oh £1 will do`, Betts says` but its worth 500£ and is a Stradivari and i`m an honest dealer with a reputation to uphold`,

Seller says`i don`t mind £1 is enough, what would i do with 500£ `.

I never said it was fraud just not exactly honest ,or do you think it is???

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Arthur Betts the well known English dealer of the 19th century bought the violin named after him `the Betts Stradivari 1704` for £1 1 shilling from a guy who walked in off the street, Betts later sold it for 500£. You can read about it in the Hill Stradivari book if you have it, otherwise the whole book is online here- http://www.celloheaven.com/hill/

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So here's the basic question: is the obligation to be informed and to communicate that information on the seller or the buyer? Ignore for a moment who the status of the owner: whose statements and assurances are the dominant ones in a transaction? On whom is the obligation to identify the object and value it?

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in some countries, outside of the US, in others part of the world, people bargain just about everythings, taxi rides, clothings...and if you have managed to bargain down a Strad for $1, does it mean that you are a bad person? I think not! It means you are a good negotiator...Like Yuen was saying, nobody twisted anybod arms. Telling somebody a violin is a Strad and it is not...that's lieing. But if you know a violin is a Strad, and you are negotiating with a seller and choose not to reveil the information, I believe you should have the right to do that...even in America, businesses negotiating just about everytime they make any deals, And that's is why they need lawyers. Also, applying the term "one man's junk, is another man treasure", so I think that it is all depend on the situation... A lie is a lie, but if you are negotiating (barganing) and the other person know that you are doing it, I don't think you have to tell any of your information (as long as your opponent knows that you are doing it). Most (all) businesses choose not to tell the buyers how much they have payed for the product that they sell you, that's just normal. But, if they are flat-out lieing, or "cheat, lie, and steal", like in some cases on Ebay...it's a different story...

Cheers,

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Quote:

whose statements and assurances are the dominant ones in a transaction? On whom is the obligation to identify the object and value it?


Clearly the obligation to determine value is on the buyer. We make judgements every day about value vs. cost. "I don't buy that soap because the store brand is just as good and a lot cheaper". We are free to buy or not to buy as we choose. In the case of Betts, the judgement was easy.

What if the seller had sold a good fake Strad to Betts for $100.

A seller who knowlingly misrepresents an item makes it difficult or impossible for the buyer to make an accurate judgement. Maybe that's why it pisses us off so much when we are taken in by such misrepresentation. It is unethical because it makes the normal system of commerce useless. Stealing and fraud are unethical and laws are passed against these actions because civil society has worked out systems of commerce and these actions upset that system and give advantage to one party in the transaction. But it's still the buyer who decides to make the purchase.

Lying is the same kind of upset to communication. It destroys the utililty of language. Sometimes it's punishable by law, sometimes not.

I haven't seen a $1 Strad on ebay, but isn't that what we're all looking for when we go there, and one reason we may be reading this message board?

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Quote:

Quote:

whose statements and assurances are the dominant ones in a transaction? On whom is the obligation to identify the object and value it?


Clearly the obligation to determine value is on the buyer.

I haven't seen a $1 Strad on ebay, but isn't that what we're all looking for when we go there, and one reason we may be reading this message board?


000_3695.jpg

000_3713.jpg

Is this a Stradivarius?

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Never having seen a Strad except once through glass, I really wouldn't know one if it fell in my lap. I think I'd realize that it was a great violin, but a Strad, how would I know?

Are you making a point here? I'm sensing some InSearchOfCremona nonsense coming on...

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+++++++++++++++++++++++++++++++++++++

Is the obligation to be informed and to communicate that information on the seller or the buyer?

++++++++++++++++++++++++++++++++++

No obligation, unless mis-handling would cost serious damages.

(such as medication, hot-coffee, exposives, poisons, almost broken containers etc that kind

need warnings, general violin needs no warnings, but in Bett's case, it would cost serious financial damage, it should ask a fee before telling it )

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Quote:

Is this a Stradivarius?


Indeed it is a Stradivarius, in fact, it was made by Wofgang Stradivarius...No, wait... may be, it was made by Jet-li-Stradivarius...

Are you sure you are not Insrearchofcremona in disguise?? Have you changed your user name from Insearchofcremona to Regent??...

If you are not Insearch...somebody eventually, will explain to you about him...welcome to this forum, we have a bunch of nice people here...but, i don't think they take "none sense" that well...something about waisting time, that they don't go for...So please, try not to BS by posting German violin pictures, and claming they are Italian violins.

Cheers,

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Quote:

Are ethics only for sellers?


This is an interesting question you pose.

My feeling is this, and I have praticed what I preach. If a seller is not an expert, not knowledgeable and comes to me for advice, I recommend to them exactly what I would do if I were in the same position. For instance, a person who might follow my eBay auctions, emails me photos of the violin inherited from grandma. Grandma used to play professionally in a theater orchestra,and was a top player in her day. She always said the violin was valuable. If the photos show promise, I recommend taking it to a reputable shop for an appraisal. If they are not up to that effort, I offer to have it appraised myself, for a fee, and will sell it on consignment for them, for a fee, if they wish.

If the seller is an expert or is a dealer, or is a regular buyer or seller of violins, I will make a fair offer, that leaves me room for profit and minimizes my risk. I do not feel it ethically necessary to make a fair offer when the seller puts the violin up for sale themselves on eBay or consigns it to a major auction house. I also would not feel ethically bound to pay more than the asking price from a yard sale or flea market. I might, if the seller was someone I know, suggest that they might want to educate themselves if the item was potentially a treasure.

The point is, that I would not take advantage of a person asking for advice. If someone were offering something of value in a public arena, for an asking price or even looking for offers, I would not feel compelled to educate them.

Jesse

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There's a saying in the fiddle business--I don't know if it goes into other fields--that "you can't be both buyer and seller". That is, a transaction has two people, and they each take a role, one doesn't ask the other to switch around. If you're selling something, it's YOUR obligation to yourself to know what you have, and if you're the buyer, it's YOUR obligation to yourself to know what you're buying. It's when people depart from those roles and count on the other side to protect them that strange things happen.

In the current context, it's not the obligation of a professional shop which partly deals in appraisal as its business to provide free appraisals to people who are trying to sell them stuff. And you'd be surprised how many people want the most money they can get, yet not want to buy an appraisal to figure that out. In the real world, those people are called "freeloaders", not "victims". The dealers I'm experienced with treat things very differently if a customer purchases an appraisal, which is, in effect, hiring the expert to work on your side, compared with dealing with a customer who comes in who doesn't do that, thus putting himself on the other side of the table.

A slightly similar situation is seen in real estate, where the broker normally represents the seller, UNLESS he's been contracted to represent the buyer. If you're buying a house from a broker who's not working for you, he's NOT working for you, pure and simple, he's working for the other side. No one considers that sleazy: people mostly understand now that the broker can't play the roles of both seller and buyer.

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I agree that it is not the obligation of a shop to provide free appraissals. If a customer comes in asking a shop to buy a fiddle, they are asking for an offer. What a fine violin by xxxx is worth to one dealer might be very different than the same violin is worth to another dealer. I cannot offer as much for a really fine fiddle as another dealer, because that is not my market,(except by accident occasionally) and I don't have the money to buy expensive violins. If a dealer is short on cash at a particular time, he clearly cannot offer more than he has.

I agree that freeloaders set themselves up to be victims. I have been told by a dealer that a violin I have is not worth the cost of an appraisal but he has been happy to give me a value range and tell me that he wouldn't buy it. I have also been offered a fair price for things I have brought him to look at, and I feel an obligation at those times to sell it to him. I also understand that an established dealer needs to sell some of the items he buys for 3 or 4 times what he may pay for it.

In general, I think it is good practice for a dealer to dispense information freely to those who request it, and sell appraissals when they are appropriate. A verbal opinion by a dealer, and sharing of some knowledge, when an item is of little value, could well result in a worthwhile relationship in the future.

Sorry for rambling. I find the marketing of expertise in this area very interesting.

One more thing. If I had a real Amati that I stumbled onto by accident at a flea market, and I brought it into a top shop, might it be conflict of interest for the dealer to certify it as authentic? Wouldn't he risk other dealers publicly disagreement, some controversy, and perhaps even risk the certifier's own merchandise values becoming diluted by another "rare" violin turning up? Is there an advantage to a dealer to certify as authentic something that might come to market to compete with his own wares? How about if the dealer certified it as the real thing and I foolishly decided to sell it to a friend for half price? Wouldn't my sale potentially cost the dealer a customer and damage the market for others that are similar?

jesse

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This is an interesting thread. Because as a non-dealer, how do you sell a violin at the best possible price? If you take it for an appraisal, the dealer will ask you what the appraisal is for. Is it insurance appraisal, in which case the price will be higher for "replacement" costs, or a consignment appraisal (estimated retail price), or an auction appraisal (you need cash fast). If you tell them it is an auction appraisal, you've put yourself "in the market" and it is their interest to lowball you, as you'll likely sell it to them. If you tell them insurance appraisal, you'll get a high figure, but it will not be reflecting reality of selling price. I'm not sure how consignment appraisals work, but maybe the dealer will think to give you a more realistic price in case you consign it with him. Since he makes 20-25% of the transaction he should want it to sell high, but also reasonably fast. So with his knowledge of the local market he should be able to give you a ballpark.

How many appraisals should you pay for an instrument? And what if all the dealers gain up and say, "this isn't worth an appraisal, tell you what, I'll give you $200 for it, and save you the cost of an appraisal". It's a problem not as much for the player owner, but for their heirs who might not know anything about violins or market values. Should they always go for consignment, and wait it out?

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"If I had a real Amati that I stumbled onto by accident at a flea market, and I brought it into a top shop, might it be conflict of interest for the dealer to certify it as authentic? "

A friend of mine lamented that if he could just sell certs, he could make more money and avoid the pain of the whole shop thing, except that the shop is the feeder for the cert requests--without it there wouldn't be any. On something like an Amati, once pain and suffering, insurance, advertising, shipping, salesman's commissions and multiple cross-continental sales trips, etc, were deducted from a sale of the same thing, the cert might actually yield more profit, since the associated overhead and costs are so low.

You might think about that the next time you hear that you should trust certain certs because the person who wrote them didn't deal violins, so there was no conflict of interest. Dealing certs *is* big business, big to the writer in direct proportion to the assigned value, as a percentage of that value--and with no reprecussions if one isn't also having to take responsibility by selling those same things at the prices they were valued at. I don't know what could be a more direct conflict of interest.

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++++++++++++++++++++++++++++++++++++

One more thing. If I had a real Amati that I stumbled onto by accident at a flea market, and I brought it into a top shop, might it be conflict of interest for the dealer to certify it as authentic? Wouldn't he risk other dealers publicly disagreement, some controversy, and perhaps even risk the certifier's own merchandise values becoming diluted by another "rare" violin turning up? Is there an advantage to a dealer to certify as authentic something that might come to market to compete with his own wares? How about if the dealer certified it as the real thing and I foolishly decided to sell it to a friend for half price? Wouldn't my sale potentially cost the dealer a customer and damage the market for others that are similar?

/Jesse/

++++++++++++++++++++++++++++++++++

It is most interesting question. Like you find a $100 bill on a quiet street. What are you going to do? Anyone can claim his or her. Would you just simply put it in your pocket and forget the whole thing that to whom it belongs and your are $100 richer. Or you can wait there for a while to see if anyone looking for it. It is a puzlling question.

If I were a knowlegeable dealer, and you came in to see me. I would ask you if you want an appraisal or a cert.( with a charge of course) a businees proposition and also give you an

opportunity to find out its woths. Fair enough? /yuen/

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Re: selling certs

Interesting... if the price of the cert is proportional to the certified value, then the value can be inflated to justify the inflated certificate price. Why does the seller want to buy a certificate? So they can get a higher price from the would-be victim? Seems like collusion between the dealer and the seller to dupe the buyer.

What's the going rate for certiticates and "appraisals"? Can a seller easily recoup the cost by getting a much higher price?

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