This is what I found out at Goofbay when I did a search about privacy issues:
"it is 100% safe. goofbay, is a recognised and well established "safe" comunity, and recomended by all the top names, like money saving expert, martin laurence, from GMTV . the tool works by you regestering, and submitting your info, ebay name, and password tot he tool, that is then encripted so even the admin cant see it.
after that you just set up the snipes, and the tool will do its best to bid on the items you ant it to, by loggin into ebay, and bidding in your name"
"It is as safe as manual bidding from your own computer, as Mark says.
There have never been any known security problems experienced by using the Goofbay sniper."