A Raleigh, N.C., real estate speculator pleaded guilty to conspiring to rig bids at real estate foreclosure auctions in eastern North Carolina. The charge and subsequent guilty plea is the first in an ongoing federal investigation into fraud and bidding irregularities at auctions in several North Carolina counties.
The bid rigging was designed to suppress and eliminate competitive bidding on foreclosed properties and buy real estate via public auctions at noncompetitive prices, the U.S. Department of Justice said.
Christopher Deans pleaded guilty Sept. 10 in U.S. District Court in Greenville, N.C., for conspiracy to rig bids during foreclosure auctions in eastern North Carolina from at least as early as April 2003 until at least April 2005, according to the DOJ. Deans, an owner of Raleigh-based real estate investment companies, and his co-conspirators paid each other not to bid against each other on particular properties during the foreclosure auctions, according to the charge.
As a result of the rigging, lien holders and certain homeowners received a lower price for properties sold through the auctions, the department said.
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A real estate executive in Stockton, Calif. pled guilty to bid rigging in a scheme to profit off sheriff sale foreclosure auctions.
Anthony Ghio admitted in his guilty plea that he conspired with a group of real estate speculators who agreed not to bid against each other at certain public real estate foreclosure auctions in San Joaquin County, Calif. in order to suppress and restrain competition and to purchase distressed real estate at non-competitive prices, according to an announcement by the US Attorney for the Eastern District of California and the Department of Justice’s antitrust division.
According to court documents in the case, from April 2009 to October 2009, after a designated bidder purchased a property at public auction, the conspirators would hold a second auction, bidding among themselves for the property at a price higher than what was paid at auction. That difference between the price at the public auction and that at the second auction was the group’s illicit profit, and it was divided among the conspirators in payoffs, officials said.
Bid rigging is a violation of the Sherman Act and carries a maximum penalty of 10 years in prison and a $1m fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim of the crime, if either of those amounts is greater.
Another con job, from the latimes.com:
Being a cop wasn’t enough for Darcey Greenfield.
The 17-year veteran of the Los Angeles Police Department moonlighted in the tumultuous world of real estate. Her “dibbling and dabbling,” as she put it, began with her buying a small apartment building during her rookie year and grew into a full-fledged side-profession. She got a real estate license and office space where, on days off from wearing the badge, she researched investments and met with clients.
Many of those clients came from the LAPD. For years, Greenfield said, she stuck to brokering loans or selling homes for other cops. But eventually she took the step of investing other people’s money in real estate ventures. In police station hallways and locker rooms, word spread about the detective assigned to Narcotics Division who could turn a quick profit if you had money to invest.
……….The women had heard from other cops that Greenfield taught informal seminars on real estate investing and approached her for advice and lessons, Sandoz and Greenfield said. Talk eventually turned to Dowd. How much Greenfield told the women about Dowd and the investment plan is a matter of debate. Greenfield insisted the details were discussed and that the women spoke with Dowd periodically on the phone about particular properties.
Sandoz disputed this. “Every penny I invested, I just gave to Darcey,” she said. “When she explained the deal to us, it sounded good, but I really don’t know what she did with the money.”
Sandoz pulled together at least $327,000 from her own savings and from relatives, while Bobo and two partners invested $440,000, according to court records. Lark went in for more than $446,000, Greenfield claimed in her bankruptcy filing. The other two women in the group, a probation officer and a day-care operator, each put up six-figure sums, according to the bankruptcy filing. Greenfield allegedly told the woman they should expect their investments to reap 30% profits within six months, according to court records.
At the same time, Greenfield was taking investments from friends and other LAPD employees. A records clerk at a police station gave her more than $200,000, according to bankruptcy records. A detective in the department’s vice squad invested more than $250,000.
All of the money, Greenfield said, went to Dowd. She never asked to meet any of the people who allegedly needed help paying their mortgages. Instead, she said, she simply transferred funds to Dowd’s bank accounts and trusted him to handle the banking forms and property records required to complete real estate transactions.
Several investors said they regret not demanding more information about the investments. They said they just assumed Greenfield was trustworthy.
“I probably should have researched it more, but she was a cop, so I just figured I could trust her. I assumed it was all on the up and up,” said a veteran officer who invested about $45,000 and asked his name not be used out of concern that being associated with Greenfield could lead to discipline by police officials.
In all, Greenfield claimed that she gave $1.8 million of other people’s money to Dowd and $1.9 million of her own — funds she said she raised by taking out loans against several of her properties.