Wata / Redhood : Should dealers be able to work at Wata?

[SkywardLink 3]

Do not worry, this is not a bitching and moaning about dealers or inflated prices, I am pro-market and long term collector of video games. I am actually very pro Wata and think Deniz and Mark have set-up and built a great company and why this topic had to be addressed. 

 

Recently comic book dealer Rob at RedHood Comics worked at Wata for 6+ months. After leaving in August, he converts to RedHood Games and says in a few weeks he is opening his new game dealer store of hundreds of Wata games. One at minimum could assume he purchased hundreds of games to sell while working at Wata. The two main questions I have is:

 

1) If employees can access population reports the public can not, is this not an unfair advantage? If only 1 9.8 of Golden Eye has been graded by wata, that information is crucial to all buyers, collectors, and dealers. To me it would be like an employee of the SEC buying stock of companies and be allowed to sell their stocks 8 weeks after.

 

2) Wata as far as I know is less than 10 employees, wouldn't an Employee getting games graded by his or her co-workers be a conflict of interest? 

 

 

 

3) Should employees be able to sell games after 1 year of working at Wata? 8 weeks is the turn around for 1 game in the Turbo scale. 

 

 

 

This is in no way against the Wata team or even Rob, but I know if I was wondering these questions- I am sure others would have interesting views on the topic. I ask these questions so Wata can learn from their possible mistakes and grow stronger

 

 

 

 

 

 

"It's dangerous to go alone! Take this."

 

 

[Reed Rothchild 8,516]

As an outsider who doesn't care about sealed, doesn't do business with sealed, will never have any involvement with any of this, has no background in law whatsoever...

The entire WATA extended operation seems like one gigantic conflict of interest, with dubious legality.

[RH 4,438]

16 minutes ago, Reed Rothchild said:

As an outsider who doesn't care about sealed, doesn't do business with sealed, will never have any involvement with any of this, has no background in law whatsoever...

The entire WATA extended operation seems like one gigantic conflict of interest, with dubious legality.

Yes this sounds like it has the potential to be shady, but I doubt it's illegal unless the SEC has recently reclassified collectibles as some form of "security". And I'm sure the SEC hasn't done this.

Maybe it's honest.  Maybe WATA has controls in place where when games come in, they are assigned a number, and the graders have no clue where the game from (accept in the rare case where they recognize the specific item, like a numbered NWC cartridge.)  That'd be a very-positive step forward, but it's unprovable whether they'd follow those guidelines are not.

Regardless, if anyone from WATA reads or hears this, now would be a good time to comment and possibly add an update to any policy/customer commitment page on processes you'd put in place to avoid this.

I don't think I have anything against employees either buying games OR having their own games graded.  If WATA isn't publicly providing this info (specifically grades for specific games) then they need to have internal agreements with workers that any game they get graded can't be sold for 12-18 months, or something like that. That would be a "good faith" move.

Regardless, the same standards we could request/expect of them need to be applied to VGA.  In fact, this scenario was probably easier to spot because as OP stated, maybe 10 people have worked for WATA?  How many people work for VGA? I know they are a network of grading companies so it could be possible for someone to primarily work with coin grading, and then internally use their connections to get games, or comics, or cards graded.  Yes, I think these are important questions from the OP, but it also applies to VGA.

[captmorgandrinker 1,609]

With a company that small, isn't it inevitable that you would run into something similar eventually anyway?

If they're pulling in industry experts to grade things, some of those guys are going to be dealers/shop owners.

[DefaultGen 4,934]

11 minutes ago, RH said:

Yes this sounds like it has the potential to be shady, but I doubt it's illegal unless the SEC has recently reclassified collectibles as some form of "security". And I'm sure the SEC hasn't done this

I mean that Rally site is actually regulated by the SEC and they just disclose “The games we sell we bought from ourselves at inflated prices” right on the site.

The great thing about what this guy is doing is there is no regulation and no one to stop him. There are no inside trading or market manipulation laws for video games. Who’s gonna regulate it? Mario to the mooooon.

[arch_8ngel 1,597]

 

1 hour ago, SkywardLink said:

 

 

2) Wata as far as I know is less than 10 employees, wouldn't an Employee getting games graded by his or her co-workers be a conflict of interest? 

 

Seems like a pretty a clear conflict of interest to me.

Though, to go along with that, in the collectibles market, when it comes to the very rarest items, it was pointed out when WATA started that there are inescapable potential conflicts with some things, because if you are known to be the only person that has a thing, and you send it to get graded, no "anonymization" scheme could possibly work -- everyone will always know who the grade is for.

Tough to avoid that kind of potential for conflict without outright refusing service to people.

[SkywardLink 3]

I want to clarify that I do not think having dealers as graders is a problem. No third party grading company can evade all conflicts of interests and I do think Deniz does a great job himself of separating himself from those conflicts. I think letting employees get games graded and allowing them to selling video games within 18 months of working there is the two main issues

[ThePhleo 2,035]

Full Disclosure: I consider myself friendly towards WATA and company but I’m openly willing to comment and criticize on the shortfalls and also give praise to WATA, Deniz, and Kenneth and their advisors where due.

 

People in position of “Authority” or “Power” (relatively speaking) can not exist in a vacuum. Even the most noble of people have friends, partners, and loved ones that may result in compromising the facade of neutrality.

Furthermore, a company like WATA cannot exist without having insider knowledge of what is and isn’t collectible, and to get to that point these people must also have the desire to attain these things to begin with, making already a conflicting interest.

Ethically speaking, A truly perfect grading company would bar all partners, advisors, officers, and employees, from the past, present, and future from using their services permanently.

A perfect grading company should also have agreements in place to keep all of their items in their collections frozen in trust for a certain amount of time after their employment ends to prevent conflicting interests...they should also demand that their collections do not grow during their time at the company.

...

However, you won’t attract the best of the best if you implement something like this.

At the end of the day, WATA is a company run by people. People like money, and that’s not a bad thing.

Im not with the “in” crowd specifically since I’m not “one of them” but I do have the advantage of experience allowing me to know what exists and what doesn’t. I’m not saying I’m a living encyclopedia but just because they have an upper hand with easily accessible knowledge doesn’t mean everyone else doesn’t have an equal opportunity.

I can just as easily throw caution to the wind, take out a loan for $X thousand dollars and buy sealed games and flip them since I’ve been around long enough to know what’s hot and what’s not.

But I won’t do that because to me collecting is fun, not business. ... again, business is also fine.

Getting priced out of the hobby sucks, but it’s been going on since they stopped making these things in the 80s and 90s.

[Dan64 66]

Easily employees should not be allowed to get games graded. I hope one of the Wata team members clarifies because it is concerning and need of attention. Seem like great people at Wata and hope they prosper

Edited September 29, 2020 by Dan64

[DefaultGen 4,934]

3 hours ago, Dan64 said:

Easily employees should not be allowed to get games graded. I hope one of the Wata team members clarifies because it is concerning and need of attention. Seem like great people at Wata and hope they prosper

Employees can't get games graded. It sounds like the dealer was buying games while working there, the concern being they had inside info of non-public population reports that would help them buy the right things. Although in the past 18 months they could've bought 100 cases of Circus Atari and Donkey Kong Land III and still come out ahead, so I don't know how any info he had would really have been that useful.

[Dan64 66]

I see the point that it was a blue ocean but also if you know there is only three 9.0 or higher Tyson Punch Out, you could corner the market as a dealer. It will be interesting to see what games he brings to market with information he was privy to

[OptOut 8,433]

Damnit, looks like I got some more SATIRE to do... I don't get paid for these you know, it's for the love of the craft!

[Bearcat-Doug 4,917]

As far as I know, employees can't have games graded or sell them, but I'm not sure that they can't buy them. That could be an issue if they are using information in the database to drive purchases. 

[SkywardLink 3]

I am sure a company like Heritage that sells hundreds of millions in assets would not be pleased if this is true. Isn't one of the co-founders on the board of Wata?

[SkywardLink 3]

It is surely possible he bought hundreds of games while working there than got them graded during the 8 weeks he said he is giving as a grace period between working at Wata and starting a video game resell company. Would make sense why Wata is so backed up

Wata should decline to grade the, They should not grade an ex-employees games for 18 months- no question a conflict of interest 

Edited September 29, 2020 by SkywardLink

[B.A. 1,136]

Member who joined yesterday and has only participated in this thread...Hmmm

Maybe this concern is legitimate, maybe not.  This feels like someone who has pre-conceived notions about WATA already though.  

[SkywardLink 3]

I started the conversation under an alias due to concern of backlash from Wata. I would guess I am not the only person who does not feel comfortable saying anything that can be contrived as negative about the company that handles your most prized possessions. Like I said in first post " I am actually very pro Wata and think Deniz and Mark have set-up and built a great company and why this topic had to be addressed. " You can not improve if you do not see the flaws in your ways. This was a way to address a concern so going forward an issue like a dealer working at the company and buying up many hundreds of games, getting them graded by wata, and reselling them would not happen going forward.

 

[Scrobins 1,532]

1 hour ago, SkywardLink said:

I started the conversation under an alias due to concern of backlash from Wata.

What do you mean by this? Do you have an account with VGS under another username?

[Gloves 10,905]

If you're fearful for backlash because you speak out against anti-consumer practices, is that really a company you want to deal with?

[Gloves 10,905]

And yeah - only one account please. PM me with the one you want to keep; the other will be closed.

[SkywardLink 3]

my other account has been stale for some time but will make sure to contact you to clear that up, thank you.

I thought the questions would be a good conversation for this group on video game collectors and good knowledge for all. I am confused about what pre-conceived notion B.A. is eluding to, please do clear that up. Wata is a great company that is doing great things in my opinion for video game collection. I think they grade games fairly as all evidence has shown in my eyes. 

But the question is, should employees be able to purchase games for resell while working at a grading company? Should an employee of a grading company be able to get an item graded from his former employer within 12-18 months of working there? This does not have to be specific to WATA,  I ask the same question for VGA. I would say the same for CGC comics, CBCS, and ... naw PGX should not be in the same sentence. 

 

 

[Hammerfestus 3,587]

Jeff?

[Gloves 10,905]

10 minutes ago, Hammerfestus said:

Jeff?

Lol can you imagine?

[B.A. 1,136]

1 hour ago, SkywardLink said:

I am confused about what pre-conceived notion B.A. is eluding to, please do clear that up. 

I was simply alluding to the fact that this thread smells stinky due to the circumstances. You confirmed the funk by admitting you made a fake dupe account.

[SkywardLink 3]

The whole thread smells "stinky" because you want a frontal picture and phone number? Kidding aside, I said the reason to not want to put name to the one starting a conversation. If that detours the conversation because I raise questions of a Wata employee coming to market several hundred Wata games less than 3 months after working there, thats your perspective. I prefer Wata over VGA. I think Wata is a great company with great leadership. My motive to post this was meant to see if I saw this incorrectly and get other perspectives. If you have any perspective or aspects of value I would love to hear your 2 cents