Beware Of Sedo, Read This!

[Netego]

My friend sold a domain name on Sedo last week, he authorized the transfer of the ownership and registrar of the domain name on Sept. 2, 2004, the Registrant-Of-Record was changed on Sept. 8, 2004.

Usually, when the domain name is transfered to the buyer's Registrar and the buyer's name shows up on Whois record, the sale is complete. But not this time!

Sept. 10, 2004, 2 days after the name change, Sedo forwarded a "Domain Ownership Change" Form on behalf of the buyer and asked my friend to sign it. Why? Why now and not before the name change? (The electronic sale agreement of this deal was reached at Sedo Site with all parties agreeing not to sign an extra written copy contract) The interesting thing here is my friend was asked to sign under a phrase "I represent and warranty that I possess the authority to legally bind the currant registrant-of-record...", but the name of the current registrant-of-record was the name of the buyer!

My friend knew that signing this "false" document would have serious consequenses, so he emailed his objection back to Sedo on the same day and asked Sedo to cancel the deal because of this unreasonable demand. Sedo replied and said "You do not need to do anything but wait a few days".

4 days later, my friend received an email from Sedo saying they were processing the payment, and these showed up on Sedo site.

Transaction History:

2004-08-29 Agreement reached
2004-08-29 We have invoiced the buyer for the sale of your domain. As soon as the payment reaches our escrow account we will inform you and begin the technical transfer.
2004-08-30 We have received the buyer's payment for your domain. We can now begin the technical transfer.
2004-08-30 Your domain is currently "LOCKED" by your registrar making a transfer impossible. Please remove this lock, or contact your registrar to have it removed, so that we can complete the transfer.
2004-09-02 The buyer has started transfer request. Please confirm the next transfer request from , or contact us to verify the request to be confirmed.
2004-09-14 The domain transfer has been successfully completed! We will now process and send you your payment for the domain.
2004-09-14 We are now processing your payment for the sale of this domain.

HOWEVER...
Yesterday, Sept. 17, Sedo told my friend that they "CANNOT" send the payment because the Form was not signed!!!

This is really alarming to all domain name sellers.
Is it legal for Sedo to ask the seller to sign an "untrue" legal document after the domain name is already transfered? Especially in this case the sale agreement was reached when both the buyer and the seller chose the option not to have a hardcopy sale contract.

If you know how to best cope with this situation, please let me know. Many thanks.

 

[seeker]

email Ms. Nora at Sedo
I am sure she can help you.
You can find her email and details at the correct sub forum in the partners section.

Sedo is growing rapidly, and errors do occur, and I can tell you, I know they can be frustraring.
But with our feedback, I am sure they can be informed and correct the situation.
Also, it is a weekend (now), dont expect a reply before Monday.

 

[Netego]

Hi Seeker,

Thanks for your suggestion and help. Will let you know the result of this.

 

[yesonline]

Why your friend transferred the domain to the buyer directly instead of going to SEDO first? The middle man as SEDO should take both the domain and payment and send them to buyer and seller later. I believe there must be a mistake that caused the trouble now. don't worry, I think SEDO will send money to the seller as long as they are sure the domain has been under the buyer's control.

 

[Netego]

Why your friend transferred the domain to the buyer directly instead of going to SEDO first? The middle man as SEDO should take both the domain and payment and send them to buyer and seller later. I believe there must be a mistake that caused the trouble now. don't worry, I think SEDO will send money to the seller as long as they are sure the domain has been under the buyer's control.

Sedo directed every move during the transaction. My friend authorized the transfer when Sedo told him to. Sellers don't normally talk to buyers directly when an escrow company is involved.

 

[Domagon]

One word for next time ...

escrow.com

I know it's not always possible to use them if a domain deal is done elsewhere (ie. Sedo), but anyways, deals through them fly ... had 12 hour turn-around already with them; 2 to 5 days is more typical.

Sedo is trying, but they still don't get how business is done in many parts of the world these days ... many folks do deals through email and click-through agreements; fax. People expect deals done fast in hours, or a few days tops ... not weeks.

Anyways, if the buyer has *full control* of the domain, then Sedo has an obligation to release the money to the seller now.

Ron

 

[Netego]

You are right Ron, escrow.com is fast. I used them a few times, very happy with them.

 

[fryman04]

I agree that SEDO is a nightmare. Terrible experience there...
Netegeo, how does Escrow.com pay you? Do they send you a check?

 

[Netego]

I agree that SEDO is a nightmare. Terrible experience there...
Netegeo, how does Escrow.com pay you? Do they send you a check?

You can choose to be paid by check or wiring. There's a $20 (or $25?) charge for wiring but their service fee is low, somewhere around 3% of the sale total.

 

[SedoCoUk]

Hello from Sedo,

Netego - please PM me the domain name involved in the transfer issue mentioned in your initial post.
Was this a .co.uk domain name?
If so, all parties in a .co.uk domain names transfers must sign Change of Ownership Forms with Nominet.
This has nothing to do with Sedo.
It is a requirement of Nominet.
When parties agree to foresake a written contract on Sedo, it means that they agree to use the online contract method for Sedo.
This contract is different to that required by Nominet.
The domain name cannot be released until the forms are signed - this is a Nominet requirement for all .co.uk names.
All .co.uk domain transfers require paperwork - again - nothing to do with Sedo
These change of ownership forms are a requirement irregardless of the escrow company that the parties choose to use.
Kind Regards,

Nora Cotter
Key Account Manager
_______________________________________________

SEDO.COM :: Buy and Sell Domain Names and Websites

tel +49 (221)-420-758-287 :: fax +49 (212)-202-3951
email: [email protected] :: url: www.sedo.com

_______________________ :: make a name for yourself.

 

[Domagon]

2004-09-14 The domain transfer has been successfully completed! We will now process and send you your payment for the domain.

2004-09-14 We are now processing your payment for the sale of this domain.

Mystifying! Sedo basically says the transfer is all complete and is disbursing funds ... and then afterwords says in effect "no, not so fast" ... doesn't exactly inspire confidence.

Sedo should consider outsourcing the escrow function to another company, at least temporarily, if they can't handle the volume of escrow transactions in-house.

Ron

 

[dvdrip]

From what I see they can't handle anything lately.
Sales, escrow or parking.
Nora tries her best but she is alone.
I am very sorry for sedo.

 

[fryman04]

I received an offer for a domain on SEDO. I agreed to the offer, and 2 weeks later no news about it. I emailed SEDO twice asking what was happening, and they just said that the transaction was cancelled because the buyer didn't want the domain any more. So, it seems that you can go to SEDO and start playing around, making crazy offers and messing up other people's business, and there will be no problem.

 

[Netego]

Hello from Sedo,

Netego - please PM me the domain name involved in the transfer issue mentioned in your initial post.
Was this a .co.uk domain name?
If so, all parties in a .co.uk domain names transfers must sign Change of Ownership Forms with Nominet.
This has nothing to do with Sedo.
It is a requirement of Nominet.
When parties agree to foresake a written contract on Sedo, it means that they agree to use the online contract method for Sedo.
This contract is different to that required by Nominet.
The domain name cannot be released until the forms are signed - this is a Nominet requirement for all .co.uk names.
All .co.uk domain transfers require paperwork - again - nothing to do with Sedo
These change of ownership forms are a requirement irregardless of the escrow company that the parties choose to use.
Kind Regards,

Nora Cotter
Key Account Manager

Hi Nora,

Thanks for reading my post. I just PMed you the domain name involved. It's a .COM domain name.

Like all other members of this forum, I have authorized the transfer of many hundreds of domain names, mostly without the help of an escrow company, and I have seen very few problems.
I believe most of the domain transactions at Sedo go smoothly, maybe only 5% of the transactions need special attention or extra work. That's why Sedo is expanding, because the profit is good and and the work is easy. But please remember, your customers are willing to pay you because they count on you to do a proper job for that 5% un-smooth transactions.

To help you see the problems that my friend experienced, let me sum up what I saw.

1/. Not all domain buyers are familiar with the process of domain ownership transfering. It is the responsibility of Sedo to show them the procedures of buying a domain name. And it is the resposibility of Sedo to make sure that all agreements or contracts that should be signed be signed before Sedo intructing the seller to authorize the transfer of ownership. Once the current Registrant-of-Record is in the buyer's name, it's a misrepresentation if the seller signs any legal document swearing that he is still the current Registrat-of-Record of the domain name.

2/. If Sedo failed its job at #1 and the buyer requested the signature of the seller be put in the contract between him and his registrar. Sedo should taken time and investigate if the buyer's request is justifiable and prepare a proper document for the seller to sign to make up for what was missing. Unfortunately, Sedo did not even bother to find out what problem the buyer had. All Sedo did was forwarding the Form and the buyer's email (addressing to Sedo) to the seller and offer no reason why this was necessary. Even worse, the Form forwarded is a wrong Form. Apparently, the buyer downloaded this Form from his registrar's website. It is a good Form to use between him and his registrar if he decides to SELL this domain name 60 days later, but is is a wrong Form for him to use to BUY a domain name in this case, because the seller on this Form has to swear that he is
a/. the current Registrant-of-Record of the domain name (which my friend is not or no more)
b/. the current Registrant-of-Record as shown in the (buyer's) registrar's control panel (which my friend has no way to verify, because he never dealt with the buyer's registrar and has no password to lock in to look at the control panel)

3/. Sedo failed its job at #1 and #2 and after receiving my friend's email complaining of the wrong Form, Sedo sent out this email to my friend, "We cannot send you payment because you have not signed the form.... Please let me know when you have done this."

How can you solve problem with such "professional" manner?

Thank you again, Nora.

 

[cwsteam.com]

Website sale complete, I am still awaiting payments although sale is complete :-(

 

[fryman04]

Good luck... at least your sale didn't get cancelled by SEDO.

 

[cwsteam.com]

Good luck... at least your sale didn't get cancelled by SEDO.

everything OK now. Received payments via Paypal from SEDO.

 

[guiwang]

A good result.I think SEDO is always good,right?

 

[GiantDomains]

This has nothing to do woth the SEDO partnership with DNF.
Thread being moved to appropriate forum.

 

[Cash Is King]

This has nothing to do woth the SEDO partnership with DNF.
Thread being moved to appropriate forum.

Sedo.com is a preferred partner with Dnforum. This means that a partnership agreement was struck in principal, to help grow and support each others business.

This appears to be an important enough issue, in that, the proper handling and rectification are completed by SEDO in a timely manner. An explanation is also needed to help the dnforum membership understand exactly what happened in my opinion.

I, as a member, look to the leadership of this forum, to support its membership by keeping this in the face of SEDO. Otherwise, in my opinion, it makes it ok that this is happening and that we do not want to inconvenience SEDO because of a paper agreement. Moving this thread also suggests that DNforum is recommending to the membership that it is ok to continue business as is.

I'm recommending it is put back in the SEDO forum until the problems are fixed. I'm trying to remain logical as I support dnforum unconditionally myself.