Schumer

‘GrinchBots’ boost costs for many holiday shoppers

Published Dec 2, 2018 at 9:00am

NEW YORK — With holiday shopping heating up, U.S. Sen. Charles E. Schumer, D-N.Y., is launching a push to pass “The Stopping Grinch Bots Act of 2018.”

Schumer said that the same cyber scalpers responsible for instantly vacuuming up tickets to major concerts have migrated to in-demand holiday toys, scooping up popular holiday gifts from dolls to gaming equipment for resale on other websites at “outrageous prices.”

Schumer explained that his legislation, The Stopping Grinch Bots Act of 2018, would thwart these cyber-scalpers by banning the surreptitious use of these bots, to purchase, horde and resell various popular holiday gifts at prices often hundreds of dollars above the retail price.

The legislation mirrors Schumer’s previous legislation the Better Online Ticket Sales (BOTS) Act, which outlawed ticket bots. Schumer called on his colleagues in Congress to pass The Stopping Grinch Bots Act of 2018 to ensure that New Yorkers across the state aren’t held at ransom when trying to purchase gifts for their families and loved ones.

“The average New York holiday shopper is unable to compete with the light speed of the all-too-common Grinch bot, and are then held at ransom by scalpers and third-party resellers when trying to buy holiday presents,” Schumer said.

“No New Yorker should have to fork over hundreds – or even thousands – of dollars to buy Christmas and holiday gifts for their children and loved ones,” Schumer said. “That’s why I’m calling on Congress to pass my legislation, The Stopping Grinch Bots Act of 2018, as soon as possible. It is of the utmost importance that these Grinch bots are stopped in their tracks, before they’re allowed to steal Christmas – and money – from the hardworking residents of Upstate New York.”

Schumer explained that “bots” are sophisticated computer programs often used by scalpers and brokers that plague the online sale of many items. In years past, cyber scalpers primarily used bots to snatch up popular tickets to concerts and live theater productions, leaving fans with no choice but to buy tickets through secondary resale sites at much higher prices. Artists, musicians, theater owners and concert promoters alike led the charge against bots used by online hackers and scalpers in an attempt to improve the ticket-buying experience for customers and guarantee increased transparency for fans. 

“These cyber-scalpers use Grinch bots – the same technology ticket scalpers employed – to purchase at lightning speed the hottest Christmas toys en masse, create a false shortage and then resell them to desperate parents and grandparents – at obscene mark-ups. It is a cynical rip-off pure and simple, and we should put the clamp-down on these predatory scammers ASAP. It is more hurtful to Christmas consumers than any ‘Bah, humbug’ ever uttered by Scrooge,” Schumer said.

In 2016, Congress passed the Better Online Ticket Sales (BOTS) Act, led by Schumer alongside Senator Blumenthal, D-Conn., and Rep. Paul Tonko, D-N.Y., which prohibits the unfair and deceptive act of using mechanisms such as bots in order to scoop up tickets before consumers are given a fair chance to buy them. However, the legislation does not extend to items beyond tickets. 

This legislation would use the framework of the BOTS Act and apply it to the use of bots on popular consumer products that have now become extremely difficult to purchase at a reasonable price.

Last year, Schumer’s office searched online for some of the top holiday toys: WowWee Fingerlings, Super Nintendo entertainment system NES Classic Edition, the L.O.L. Surprise! Doll and the Barbie Hello Dreamhouse Playset.

  • Fingerlings, which typically sell for $14.99, were out of stock online at Toys-r-us, Walmart, and Target. However, the item was available for sale on Amazon and eBay for as much as $1,000 each – an increase of 6,571 percent over its retail price;  
  • Super Nintendo entertainment system NES Classic Edition, which sells for $79.99, was out of stock online at BestBuy, Game Stop, and Target. However, the item was available on Amazon and eBay for as much as $13,000 each – an increase of 16,152 percent over its retail price;
  • L.O.L. Surprise! Doll, which sells for $9.99, was out of stock online at Toys-r-us, Target and Walmart. However, the item was available on Amazon and eBay for as much as $500 each – an increase of 4,905 percent over its retail price;
  • Barbie Hello Dreamhouse, which sells for $300, was out of stock online at Toys-R-Us. However, the item was available for sale on Amazon and eBay for as much as $1,500 each – an increase of 400 percent over its retail price.

Schumer explained that according to Distil Networks, a leading company that researches and helps to prevent bot-use, in 2017 there was a 20 percent spike in bot use during Black Friday and Cyber Monday.

Schumer said that this statistic both illustrates the widespread prevalence of bots during the holiday season and the importance of passing The Stopping Grinch Bots Act of 2018 immediately, before they are able to snatch up any more of this year’s hot gifts. Schumer strongly urged his colleagues to pass The Stopping Grinch Bots Act of 2018 as soon as possible, to give New Yorkers and their wallets some serious relief this holiday season.