A number of times I have seen this going on on ebay, but I can not find any other reference to it on the web and has happen to me a number of times.
As you may know, on ebay you can bid and "Buy It Now" on items. This post is to do with bidding.
Say you are looking for a item, lets call it a watch. You look on ebay and you see the watch you like and it has a starting price of 99p
Now you know a thing or too about watches and you know it is worth £10, but you would hate to be outbid. So you you place a maximum of £12, the two pound extra just to cover it.
OK as it stands the current bid is 99p with your reserve of £12 waiting in the wings.
So the next person to see the watch who is, how shall we. Less of a sporting gent as you are. He sees that it is only 1 bid and up for 99p with still days to go.
He could wait till the last few seconds and bid £10 to try to beat you, but your £12 will automatically outbid him. They could bid £20 that would beat your bid of £12 but if you had bid £19 they would end up paying twice the price for the watch.
On ebay they say your maximum bid will not be revealed.
But! All the less then sporting chap has to do, is bid a crazy price like £10,000 and they will become the highest bidder at £12.50 Then they do a bid retraction "entered the wrong amount" them crazy fingers.
They then can think to them self, 50p more wont break the bank and snipe you at the last moment. It works as well if you had bid £19 they would know the maximum and walk away as the price is too high for them.
On a side note when they do walk away they often rebid just below your maximum. Which is a bit like a shill bid but they are unrelated to the person selling said item. Probably done to troll.
And 99.9% of times will out bid or snip you at the last moment, so it is in there interest to keep the price low.
My advice is to only bid your maximum in the last few seconds, which is not always possible.
Hope this was clear, any questions or input?