Surely the point is that this is simply cheating, or exploiting another manager who wants the type of player up foe sale. It should be monitored and people banned who take this action.
Yes you can remove yourself from the bidding process, but that isnt the point here, the point is a manager taking advantage and bidding on his own player.
If you would buy such a player for say 500k, why should the owner of the player be allowed to push it further and you end up paying more, say 700k, you could stop, but you may want him. You have still been corrupted and exploited fr another 200k.
In England, someone who did the same on Ebay got sent to prison, now I know this is just a game, but its hardly in the spirit of the game and should be allowed.