Amen to that, KY Jon.
When buying foreclosure's, I see it continuously.

Though I do see Ed's point at the dealer reputation level.

But, and it's a big BUT!, it improves market efficiency when these kinds of shill bidders are exposed. And auctions are supposed to demonstrate market efficiency.

Most of the auctions we participate in have earnest money deposits required. So, there is a little less room for shill's. Typically, they fail to file required paperwork within 3 days, and their bid is then rejected.

And of course, the auctioner's then suddenly contact bidder #2.

I always tell them FO. It's principle to me.

I've seen prices collapse over 100k when the 2nd place guy says No! to the scam.

Out there doing it best I can.