This afternoon, SnapNames sent an email to their customers alerting them that a (assuming former) employee had registered an account at SnapNames and had been bidding on various auctions. The result of this activity is that many people who were bidding on the same auctions either lost a domain they would have won or paid much more for winning.
SnapNames has promised to repay anyone who won an auction that was bid up and pay them interest (5.22%). This sound like a pretty fair remedy to the situation. However, there was no mention of the domains that people would have won had this employee not won the auction.
A rather startling snippet from the email: “The incremental revenue from the bidding represented approximately one percent of SnapNames’ auction revenue since 2005.”
Here is a copy of the email that was sent earlier today:
I’m contacting you today to inform you of an unfortunate incident at SnapNames, and to let you know what the company is doing to address it.
Recently, SnapNames discovered that an employee had set up an account on the SnapNames system under a false name and, under this name, bid in SnapNames auctions. This is a clear violation of our internal policy and was not approved by the company. We deeply regret that this conduct has impacted our customers.
Extent of impact
This conduct affected a small percentage of SnapNames auctions:
- Bidding affected approximately five percent of total SnapNames auctions since 2005, most of which occurred between 2005 and 2007.
- The incremental revenue from the bidding represented approximately one percent of SnapNames’ auction revenue since 2005.
No matter the level of impact, SnapNames takes this matter extremely seriously. When the matter was discovered, the company immediately closed the account in question and began a thorough investigation. The employee has also been dismissed from the company.
SnapNames further discovered that, on certain recent and limited occasions, when the employee won an auction, the employee secretly arranged to refund from SnapNames to the fictitious account a portion of the winning bid amount.
Remedy to affected customers
Though on some occasions the employee won the auction, in many instances the bidding caused the ultimate auction winner to pay more for a name than had the employee not participated in the auction.
SnapNames neither condones this conduct nor wants to be perceived as benefiting from the conduct. Accordingly, we have decided that regardless of the circumstance, in every auction where the employee’s fictitious account submitted a bid which resulted in a higher price being paid by the winning bidder, SnapNames will offer a rebate, with 5.22% interest (the highest applicable federal rate during the affected time period), to affected customers for the difference between the prices they actually paid and the prices they would have paid, had the employee not bid in the auctions. The rebate will be available in cash or in credit on the SnapNames platform, at your discretion.
SnapNames has moved quickly to address this situation. The company has retained Rust Consulting, an independent third party, who will administer the rebate offer. Within the next week, Rust Consulting will contact affected customers to provide details regarding the offer.
Your business and ongoing relationship are important to us and we can assure you that we have taken all necessary steps to ensure the integrity of the platform and reinforced controls and procedures to avoid any possibility of further breach. These include:
- Enhanced monitoring of bidding activity for suspect behavior
- Additional controls over financial transactions
- Specific domain name registration policies for employees
In the meantime, if you have any questions, you may consult the FAQs here, or contact the SnapNames support team:
By e-mail: support@snapnames.com
Phone: +1 (866) 690-6279 (toll-free in the U.S.)
+1 (503) 241-8547 (outside the U.S.)
SnapNames, and all in the Oversee family of companies, are deeply disappointed with this incident. Since its founding in 2000, SnapNames has been committed to the principles of fairness and trust; the company wants to assure customers—through both words and actions—that it remains committed to those principles.
Thank you again for your business, and for your ongoing trust in SnapNames.
Sincerely,
Jeff Kupietzky
President and CEO
Craig Snyder
General Manager, SnapNames.com
SnapNames
1600 SW 4th Avenue, Suite 400
Portland, OR 97201
Just a quick word to the wise: AVOID NETWORK SOLUTIONS LIKE THE PLAGUE.
Sorry if I’m being a bit dramatic, but I tend to get a bit sensitive over companies that behave badly the way Network Solutions is. The DomainTools blog is covering the shady tactics that NetSol is now employing. It appears now that when you search for an available domain name at netsol.com, if the domain is unregistered NetSol will register it within minutes!
They will place a 4-day hold on the domain and then release it back into the wild. The major problem with this tactic is that it:
- Forces you to buy the domain from Network Solutions (they are expensive compared to most)
- Makes the domain you wanted available to any number of domain tasters and generally anyone watching expiring domain name lists waiting for good ones to drop.
If you lose a good domain name this way, the odds are against you that you’ll manage to recover it without having to buy it from Network Solutions.
I tried this just 10 minutes ago with a not-so-nice domain name with a few numbers thrown in. I made sure it wasn’t registered. I checked it’s availability on NetSol.com, and within 5 minutes it had been registered by Network Solutions. Unbelievable.
I’ve lost domain names by not registering them fast enough in the past, but this is to the extreme.
I have to admit, I’m a sucker for gadgets. Especially ones that use super secret complex algorithms to generate numbers that protect my online bank account.
Every 30 seconds, this compact device generates a new 6-digit code that is used to log in to my PayPal account. The algorithm is tied to a unique device id, so only numbers generated from my device will work.
I’m not sure exactly how small it is, but the PayPal website claims you can easily fit it on your keychain.
The cost is $5 and shipping takes about 10 days. I’ve already ordered mine and will post a follow-up on my experience with it.
Is it wrong that I’m doing this as much for the “wow” factor as I am the added security? What’s next–wireless thumb scanners?
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