Duffy Conley behind Internet penny auction site Bid66.com
Western Pennsylvania's former video poker king is gambling on a new — and legal — business venture.
John "Duffy" Conley is the man behind Bid66.com , a Robinson-based Internet penny auction site waging an advertising blitz on local air waves and a guerilla-marketing campaign with bumper stickers on light poles and guard rails from Penn Hills to the North Side.
"People like to see someone get on the right track," said Conley, 46, who last summer was released from his second federal prison stint on illegal gambling charges.
Now Conley and William Curtin, who served as his right-hand man in the video poker empire, want to cash in on the burgeoning penny auction bonanza.
"It's time to move on," said Curtin, 54, of Heidelberg. "You can't fix the past, but you can do something with your future. And that's what we're trying to do."
Pay to play
Bids on online penny auctions start at a penny and increase in one-cent increments, as participants bid for a chance to buy products ranging from flat-screen TVs to international vacation packages. Products typically sell for a fraction of their retail price.
The auctions run on a timer, usually up to a few minutes. The timer resets, however, with each new bid.
The winner is the person with the highest bid when the auction times out. That person pays the bid price, plus charges for each bid he or she placed.
Losing participants also must pay for their bids.
Bid66 charges 50 cents a bid. If a product sells for $10, that means 1,000 bids were placed, and the site collected $500 plus the amount of the winning bid.
Conley buys the auction items — many through Amazon.com — and hopes to turn a profit by accumulating enough bids to exceed retail costs.
Auctions that ended this week saw a Dell Vostro laptop won for $52.35, six bacon-wrapped filets from Omaha Steaks go for $3.78 and a $100 Victoria Secret gift card sell for $4.05. Other auction items included an XBox 360, an 8G iPod Touch and a KitchenAid stand mixer.
Last month, Rita Mincin was the winning bidder for a ShopVac. Her cost: $4.13, plus about $40 for the 80 or so bids she placed.
"I have been telling everyone about this site," said Mincin, 49, of Whitehall. "I know that makes my chances of winning smaller, but it's a good deal and everyone should know about it."
Aiming for the top
Bid66 has more than 6,500 registered users, but the site still hasn't turned a profit because many people are using free promotional bids, Conley said.
"It has the potential to be very successful," Conley said. "I want to be the market leader in this field."
Online penny auctions started in Germany in 2005 with Telebid, now Swoopo, said Amanda Lee, who runs the watchdog site PennyAuctionWatch.com .
"Just within the past 1 1/2 years, penny auctions have come to the United States, and they're gaining in popularity," Lee said.
Bid66 boasts nearly 425,000 visits since it launched in November. BidCactus.com , one of the most-visited penny auction sites, had 1 million views in the past month, traffic figures show.
Lee started her site in May because of what she called less-than-honest penny auction operators.
"Penny auctions are so susceptible to fraud because of the lack of transparency," Lee said. "There's nothing from stopping unethical site owners from shill bidding to raise revenue."
Conley and Curtin said their site does not use that practice. No one has accused them of such.
But there is no government oversight to enforce sanctions on ones who do, said Lee and Josh Waldron, who runs his own watchdog site called PennyAuctionList.com.
"I think auction owners are cashing in while they can, but it won't be long before some government agency steps in," Waldron said.
Neither the state Attorney General's Office nor the Allegheny County District Attorney's Office had heard of penny auctions or received complaints about Bid66.
"They should — and appear to — have clear disclosures about fees, so consumers can make a educated choice about whether to participate," said Nils Hagen-Frederiksen, a spokesman for the attorney general's office.
The U.S. Attorney's Office in Pittsburgh declined to comment on Conley's venture.
A checkered past
Court records show that Conley got into the video poker business in 1984. Within six years, he was the region's kingpin with about 4,000 machines scattered throughout more than 100 bars and restaurants.
An Allegheny County grand jury in 1989 recommended prosecuting Conley, his top aide William Curtin and dozens of others on gambling charges. A judge, however, deemed that 101 search warrants used in the case were faulty. All state charges were dropped.
In 1991, a federal grand jury indicted Conley, Curtin and 21 others on similar gambling charges.
Curtin served two years in prison for his role.
Months before Conley went to federal prison in 1995, he was accused of helping men tied to organized crime in their efforts to take over an Indian casino in Southern California. Investigators said Conley by then was running a $15-million-a-year gambling enterprise. He pumped $2 million into the casino venture and secured hundreds of video poker machines for it, court records show.
The casino opened for one day in June 1995 before being shut down. A federal grand jury indicted the group in 1997.
Conley was released from prison in January 2004.
Federal agents arrested him again in February 2006, this time for running an illegal sports-betting operation that at times handled more than $3 million per month in action.
Conley was released from prison in July 2009.
No going back
Conley thinks his criminal past bolsters Bidd66's credibility. He points out that his crimes were not violent or sinister.
"I was involved with gambling, just like the state and churches," Conley said.
He is convinced his reputation for being fair with people through his illegal-gambling operations will help his new venture.
"I always viewed it as a plus," Conley said. "A lot of people go to jail because they don't want to work. I went probably because I worked too hard."
But Curtin said neither he nor Conley want to go back.
"We want this to be 100 percent legit and legal," Curtin said. "By no means do I want to look over my shoulder again."
