There is a person who attends auctions and increases the price of the goods, but he does not intend to buy them. What is the ruling on that?.
If a person increases the price of an item that is offered for sale when he does not intend to buy it, this action is haraam, because it involves cheating and deceiving the purchaser, as the purchaser may think that the other person only offered this price because it was worth it, and that is not the case. This is the artificial inflation of prices which was forbidden by the Messenger (peace and blessings of Allaah be upon him) as it is haraam. It says in the hadeeth of Ibn ‘Umar (may Allaah be pleased with him) that the Messenger of Allaah (peace and blessings of Allaah be upon him) forbade artificially inflating prices. And it was narrated from Abu Hurayrah (may Allaah be pleased with him) that the Messenger of Allaah (peace and blessings of Allaah be upon him) said: “Do not go out to intercept the riders (for trade), do not outbid one another, do not artificially inflate prices, and no town-dweller should sell on behalf of a Bedouin.” Agreed upon.
If it is proven that the price was inflated artificially, and there was some deceit involved in the sale that was out of the ordinary (i.e., some cheating in the price), then the purchaser has the choice between cancelling the deal or going ahead with it, because that come under the heading of being given the choice in the case of cheating. End quote.