'Halvarez' at Snapnames auctions uncovered

[prague7]

Ooer - this one's going to run for a while... :O

From DomainNameNews:
SnapNames User Name “Halvarez” Was Nelson Brady, VP of Engineering Bidding on Domain Names [Updated]

[Updated] According to a statement from Oversee.net’s SnapNames, an employee was found to have bid in 5% of their auctions since 2005 and in some cases arranged for a partial refund of the sales price after winning an auction. DNN also confirmed the bidder as Nelson Brady, the VP of Engineering. He was bidding under the username “halvarez”.

From Snapnames:
SnapNames User Name “Halvarez” Was Employee Bidding on Domain Names

To avoid any question about whether the company benefited from this conduct, SnapNames will offer a rebate to impacted customers, including 5.22% interest (the highest applicable federal rate during the affected time period), of the difference between the prices they paid in winning auctions, and the prices they would have paid had the employee not bid in the auctions. Impacted customers will be notified by SnapNames or its representative with instructions for the offer of a rebate.

SnapNames also has taken further action to ensure its policies regarding auctions are followed, and the company remains committed to taking whatever action is necessary to protect the integrity of its auction platform.

SnapNames deeply regrets this situation and is committed to addressing its customers’ needs quickly and fairly.

There's also a FAQ page at Snapnames

 

[Domo Sapiens]

When people e start refering to this case as Oversee's...
Their view will change (not matter how much they want to dissasociate/distance themselves)

Front page:
Headquartered in Los Angeles, the company's core brands include DomainSponsor®, SnapNames®, Moniker®, and LowFares.comTM.

 

[TheDomains]

12,000 auctions our results

We have published some initial results from the 12,000 domain auction we were involved in at SnapNames

12,000 Auctions: The Halvarez Effect On Our Account (So Far) | The Domains

 

[cdboard]

seems like anyone who has bid on 50,000 auctions would get the attention of management.

 

[dumbluck]

Major losses

Theree are major TLD losses at Moniker 2 weeks ago. Moniker is owned by Oversee.net

It looks like a big domainer was tipped off to the fraud earlier than everyone else, and moved out all the domains.

Could it be Rick Latona? Did he transfer all his domains out? Check the gain/loss report ...:sold:

ICANN Accredited Registrars**MONIKER

 

[deb]

Theree are major TLD losses at Moniker 2 weeks ago. Moniker is owned by Oversee.net

It looks like a big domainer was tipped off to the fraud earlier than everyone else, and moved out all the domains.

Could it be Rick Latona? Did he transfer all his domains out? Check the gain/loss report ...:sold:

ICANN Accredited Registrars**MONIKER

Should we be worried? I have heaps of names with moniker/answerable....Anything to be worried about?

 

[gazzip]

Yep those names were on my auction

It would'nt surprise you if you knew who they were, most of them are big
eg: Saggydimes = BuyDomains.com

I like to check who is kicking my ass :lol:


.

---------- Post added at 10:45 AM ---------- Previous post was at 10:41 AM ----------

There's only one explanation.


These people at Snapnames were running a scam - from top to bottom.


.

I can understand why you would say that now but I really hope you're wrong


.

 

[telking]

hey guys I was browsing through my old emails and found halvarez 'nelson brady'
emailed me last year telling me to change my bid alias. Thought that was kind of weird

 

[canswift]

What I'm seeing in my Snapnames Order History are several auctions in which Halvarez was one of the original bidders. Halvarez then bids a couple more times driving the auction price up, then drops out leaving the other two bidders (me and someone else) to finish it off with an additional bid each. Halvarez now ends in third place.

In this scenario Halvarez absolutely affected the final auction price, but did not end in second place so there's no compensation. Snapnames profit from this type of price pumping must have been enormous, and of course these types of auction results are being excluded from the settlement.

 

[telking]

What I'm seeing in my Snapnames Order History are several auctions in which Halvarez was one of the original bidders. Halvarez then bids a couple more times driving the auction price up, then drops out leaving the other two bidders (me and someone else) to finish it off with an additional bid each. Halvarez now ends in third place.

In this scenario Halvarez absolutely affected the final auction price, but did not end in second place so there's no compensation. Snapnames profit from this type of price pumping must have been enormous, and of course these types of auction results are being excluded from the settlement.

I agree. And what about those auctions where you would have gotten the backorder, but since HALVAREZ entered in, it caused more eyes to see the name as there were now 2 bidders, so you end up losing the name in a high auction.

Snapnames is screwed

 

[RicoShay]

When they say he affected 50,000 auctions - does that mean this is the total number of auctions he took part in?

Or is this only the number of auctions where he came 2nd?

Does it take into account every auction where he added a pre-order (ie. becoming a 2nd bidder, but not placing further bids)?

If by 50,000 they mean directly affected (ie. 2nd highest bidder), then this number is likely to be a lot bigger for the total number of auctions where to took part regardless of where in the bidding order he ended up.

In this case, what would be outcome? It would surely change the perspective on a few things imo.

 

[shane mac]

Just think about this for a moment.

50,000 auctions over 5 years .... 10,000 a year

Or roughly 26 a day!, thats a conservative estimate.

How can this amount of bidding go unchecked?

 

[deb]

Theree are major TLD losses at Moniker 2 weeks ago. Moniker is owned by Oversee.net

It looks like a big domainer was tipped off to the fraud earlier than everyone else, and moved out all the domains.

Could it be Rick Latona? Did he transfer all his domains out? Check the gain/loss report ...:sold:

ICANN Accredited Registrars**MONIKER

dumbluck have you spoken to Nelson lately and does he intend to tell his side of the story?

Nelson Brady is a free man and hasnt been charged with anything and is free to comment.

We cant really settle with snapnames until we know the Depth of the problem...

 

[Cronus]

We have published some initial results from the 12,000 domain auction we were involved in at SnapNames

12,000 Auctions: The Halvarez Effect On Our Account (So Far) | The Domains

Good post, Worldwide! You wrote that you "are now in the process of scrapping all the data from each auction and putting it into a database so we can see how Halvarez affected all our auctions." Can you (or anyone else here) share the software you've written (or process you used) for this, so we don't all have to reimplement the same thing?

I'd like to see Snapnames give us the data in a reasonable bulk format. I'm sure they didn't make Rust consulting click on each auction one by one, so we shouldn't have to either. Still, it is great that they listened at at least reinstated the data online.

 

[shane mac]

Dont be surprised when this gets made into a movie, its got all the hallmarks of a great blockbuster!

 

[dag]

I agree. And what about those auctions where you would have gotten the backorder, but since HALVAREZ entered in, it caused more eyes to see the name as there were now 2 bidders, so you end up losing the name in a high auction.

Snapnames is screwed

Once a backordered name goes to auction, it's a private auction -- new bidders can't enter at that point.

 

[TheDomains]

The software was custom written today and is running.

Lets see if it works first and returns the results properly and then we will see what we can do to make it available to others.

 

[labrocca]

I see that Schwartz agrees with me that Snapnames will go out of business. This is why accepting their offer especially people under the $x,xxx mark might be a good idea. By the time lawyers get their cut the pickings might be slim. If they offer you $500 imho take it. If your damages are in the $xx,xxx then it might be in your best interests to join a class action.

Either way I think SnapNames is done.

 

[garptrader]

Given that more than 99% of drops are junk, how much time do domainers spend going through drop lists to find one domain worth placing a backorder on. How do you feel when you place a backorder at the last minute and then find that there are other bidders? And yet HAlvarez had the filter of only having to review the names with backorders which domainers had already identified as worthy of acquisition.

 

[DomainTalker]

It's very easy to sit here retrospectively picking apart what could have been done, but when a key person like Nelson who had the trust of the company and clients is the one who abuses that trust, there is little that can be done.

If this is something you don't understand, you simply haven't been in business long enough to know how things work in the real world.

That statement is simply nonsense, Smith...


I have been the CEO of a MultiNational corporation....And, I have owned, and run, a successful business that advised large corporates on strategy.


...And, I'm here to tell you that a properly run organisation should NEVER allow ONE person - no matter how senior, no matter how trusted - to have sole knowledge of vital operating systems, the design of them, and the operation of them - without effective oversight procedures to ensure against precisely the risk of misuse that we're seeing from Snapnames. NEVER.


Online auction systems - by their nature - are, perhaps, uniquely susceptible to the possibility of system-rigging. Any online auction system has red flag processes all over the place, if wrong-doing is afoot.....Its not rocket science....You DON'T allow the guy that designs the auction system to be the ONLY person that understands the system - and, at the same time, controls the system...!!


...Any half-decent top management group should make it their business to have in place independent audit processes - a separate group that understands, and monitors, the system, and, ensures that there are checks, balances, and double-checks, happening all the time - at every operational level - so that fraud cannot happen....Your organisation - its reputation - and, its very survival - depends upon it.....As Snapnames, and its management, are shortly about to find out.


They knew this. They didn't do it. And, the fact this didn't happen says to me that this fraud was systemic, and known, inside that organisation, from the top down.


It looks like a deliberate, management-wide, scam - not saying it was - but, if it was, then, mostly, to inflate the total value of Snapnames for resale, imo.

.

 

[deb]

Either way I think SnapNames is done.

Could Pool or Godaddy buy them?

Although i cant see Oversee letting Snapnames go bust. Oversee has the

Oversee/Snapnames will survive if it was just Nelson involved :imho:

I wonder if Oversee will do a Q&A session on this subject @ DOMAINfest Global® January 2010. Should make for a lively discussion :blink:

 

[gemstar]

Could Pool or Godaddy buy them?

Although i cant see Oversee letting Snapnames go bust. Oversee has the

Oversee/Snapnames will survive if it was just Nelson involved :imho:

I wonder if Oversee will do a Q&A session on this subject @ DOMAINfest Global® January 2010. Should make for a lively discussion :blink:

I think when the Gov't gets its hand on this they will take back controll of the domain names once again.
Sort of like when a parent gives it's child certain responsibilities and it goes south they tend to take over them once again for responsible purposes.

 

[btrader]

I believe that any auction in which Halvarez participated was a fraudulent auction, therefore all money for those auctions should be returned to the bidder who won. The domain should stay with the winning bidder - this would serve as appropriate punishment for this fraud.

If there are other aliases, they will be revealed, and the same rule as above should apply.

This includes $60 auctions that Halvarez 'participated in' as it made the auction look like it had activity - when in fact it was just more deception.

That is what I want for my "settlement".

 

[tonecas]

...And, I'm here to tell you that a properly run organisation NEVER allows ONE person - no matter how senior, no matter how trusted - to have sole knowledge of vital operating systems, the design of them, and the operation of them - without effective oversight procedures to ensure against precisely the risk of misuse that we're seeing from Snapnames. NEVER.

it is like the trader who lost billions on the stock market working to one of the most risk aware investment bank in the world. does anyone believe he was the only gilty? and so what? the company took the loss and moved on...

the problem is, when we run into big economic expansions, scams take over every business.

domaining is no different. and i would say, specially in the domain business these scams are to be expected. there are very few businesses so shaddy like this one.

this is to say SnapNames will probably survive, like Pool survived and like big players survive most of the time.

the questions are:
1) what can we do to make SnapNames take the hit the hardest way possible, even that in the end they survive.
2) how can we know that Pool and NameJet don't have scams like that?
3) how can we as members of this industry start taking more proactive actions aggainst all these scams besides waisting time posting on foruns or playing along with them by looking to the other side.

as for me, i'm a PITA for all of these guys. that's why i am not one of their buddies

regards,
tonecas

 

[DomainTalker]

it is like the trader who lost billions on the stock market working to one of the most risk aware investment bank in the world....does anyone believe he was the only gilty?

and so what? the company took the loss and moved on...

That bank didn't 'move on', actually....


It was Barings Bros Bank, in the UK - one of the oldest, most respected banks in the world.


The entire bank went broke & collapsed - directly as a result of the scam.

.

 

[tonecas]

That company didn't 'move on', actually....

It was Barings Bank, in the UK - one of the oldest, most respected banks in the world.

It went broke - directly as a result of the scam.

actually i was not thinking on that case but on the Société Générale case.

but that is good example that sometimes the big ones can fall. I doubt however that this case will led to the fall of SnapNames.

lets make a simple pool (don't know if it is already running somewhere): how many of you have stop using backorders at SnapNames and/or puting bids since knowing what happened?

regards,
tonecas