Web-based account management for hold and release of funds

• US 7,165,047 B2
• Filed: 04/16/2003
• Issued: 01/16/2007
• Est. Priority Date: 05/10/1999
• Status: Expired due to Term

• Current Assignee: Edeposit Corp.
• Original Assignee: Edeposit Corp.
• Inventors: Understein, Norman
• Primary Examiner(s): Colbert; Ella
• Assistant Examiner(s): Dass; Harish T.
• Application Number:
  US10/414,281
• Publication Number:
  US 20030225678A1
• Time in Patent Office: 1,371 Days
• Field of Search: 705/40, 705/35, 705/37, 705/1, 705/36, 705/26, 705/76, 379/114.01, 273/256
• US Class Current: 705/37
• CPC Class Codes: G06Q 20/102 Bill distribution or payments
• CPC Class Codes: G06Q 20/3821 Electronic credentials
• CPC Class Codes: G06Q 30/08 Auctions
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

A system and method for qualifying a bidder over a global network for an auction helps to significantly reduce or eliminate commerce fraud. An auction site, for example, enlists the system to maintain bidder funding accounts for prospective bidders. When a bid is placed, the funds are reserved in the bidder'"'"'s bidder funding account including funds for a deposit if required. In the event that a bidder is not the high bidder, the reserved funds are released. At completion of the auction, the funds may be transferred from the winning bidder'"'"'s bidder funding account to the seller, and the bid holds are released. A balance in the bidder funding account can be established according to funds deposited in the account in an interest-bearing account or via a line of credit issued from a bank card issuing company or the like.

Claims

1. A method of qualifying a bidder via a computer system over a global network for an auction, the method comprising:

(a) establishing a bidder funding account by depositing funds in the bidder funding account;

(b) the computer system reserving a portion of the deposited funds in the bidder funding account according to a bid submitted by the bidder to participate in the auction; and

(c) the computer system releasing the reserved portion of the bidder funding account during the auction if the bid is not a high bid, wherein if after step (c), the bidder submits a new bid, the method further comprises repeating step (b).

2. A method according to claim 1, wherein step (b) comprises reserving an amount of the bidder funding account corresponding to the bid submitted by the bidder.

3. A method according to claim 2, further comprising transferring an amount corresponding to the reserved portion when settlement is complete.

4. A method according to claim 3, further comprising releasing the reserved portion of the bidder funding account after transferring the amount corresponding to the reserved portion of the bidder funding account.

5. A method according to claim 1, wherein step (b) comprises reserving an amount of the bidder funding account corresponding to a deposit amount required by a seller.

6. A method according to claim 5, wherein step (b) further comprises reserving an amount of the bidder funding account corresponding to the bid submitted by the bidder in addition to the deposit amount.

7. A method according to claim 5, further comprising transferring the deposit amount if the bid is a winning bid and the bidder does not complete settlement.

8. A method according to claim 1, wherein step (a) further comprises paying interest on the funds deposited in the bidder funding account.

9. A method of qualifying a bidder via a computer system over a global network for an auction, the method comprising:

(a) determining whether a deposit is required to participate in the auction, and if so, determining an amount of the deposit;

(b) receiving a bid inquiry over the global network from the bidder and determining whether the bidder has established a bidder funding account, wherein

(b1) if the bidder has not established the bidder funding account, enabling the bidder to establish the bidder funding account, and

(b2) if the bidder has established the bidder funding account, the computer system accessing the bidder'"'"'s bidder funding account; and

(c) the computer system qualifying the bidder according to a balance in the bidder funding account by

(c1) reserving a portion of the balance based on the bid inquiry,

(c2) releasing the reserved portion during the auction if the bid inquiry is not a high bid, and

(c3) repeating step (c) if after step (c2) the bidder submits a new bid inquiry.

10. A method according to claim 9, wherein if a deposit is required according to step (a), step (c1) comprises reserving a first portion of the bidder funding account corresponding to an amount of the deposit.

11. A method according to claim 10, wherein step (c1) further comprises reserving a second portion of the bidder funding account corresponding to an amount of the bid.

12. A method according to claim 10, wherein if a deposit is required according to step (a), step (c) further comprises transferring the first portion of the bidder funding account if the bid inquiry becomes a winning bid and the bidder does not complete settlement.

13. A method according to claim 9, wherein step (c) comprises qualifying the bidder according to an amount of unreserved funds deposited in the bidder funding account.

14. A method according to claim 9, wherein step (c) comprises qualifying the bidder according to an amount of unreserved credit in the bidder funding account.

15. A computer system for effecting qualifying of a bidder in an auction, the computer system comprising:

at least one user computer running a computer program that requests information according to a bid inquiry input by a bidder; and

a system server running a server program, the at least one user computer and the system server being interconnected by a computer network, the system server determining whether the bidder has established a bidder funding account, wherein (1) if the bidder has not established the bidder funding account, the system server sending information to enable the bidder to establish the bidder funding account, and (2) if the bidder has established the bidder funding account, the system server accessing the bidder'"'"'s bidder funding account and qualifying the bidder according to a balance in the bidder funding account by (i) reserving a portion of the balance based on the bid inquiry, (ii) releasing the reserved portion during the auction if the bid inquiry is not a high bid, and (iii) repeating qualifying the bidder if after (ii) the bidder submits a new bid inquiry.

16. A computer program embodied on a computer-readable medium for qualifying a bidder over a global network for an auction, the computer program comprising:

means for establishing a bidder funding account by depositing funds in the bidder funding account;

means for reserving a portion of the deposited funds in the bidder funding account according to a bid submitted by the bidder; and

means for releasing the reserved portion of the bidder funding account during the auction if the bid is not a high bid, wherein if the bidder submits a new bid, the reserving means re-reserving a portion of the bidder funding account according to the new bid.

17. A computer program embodied on a computer-readable medium for qualifying a bidder over a global network for an auction, the computer program comprising:

means for determining whether a deposit is required to participate in the auction, and if so, for determining an amount of the deposit;

means for receiving a bid inquiry from the bidder and for determining whether the bidder has established a bidder funding account, wherein

(1) if the bidder has not established the bidder funding account, the program comprising means for enabling the bidder to establish the bidder funding account, and

(2) if the bidder has established the bidder funding account, the program comprising means for accessing the bidder'"'"'s bidder funding account; and

means for qualifying the bidder according to a balance in the bidder funding account by (i) reserving a portion of the balance based on the bid inquiry, (ii) releasing the reserved portion during the auction if the bid inquiry is not a high bid, and (iii) repeating qualifying the bidder if after (ii) the bidder submits a new bid inquiry.