Wayne Lippman, Walnut Creek, California, a real estate investor, has agreed to plead guilty for his role in conspiracies to rig bids at public real estate foreclosure auctions in Northern California.
Felony charges were filed in the U.S. District Court for the Northern District of California in Oakland against the defendant. To date, as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California, 55 individuals have agreed to plead or have pleaded guilty.
According to court documents, between August 2008 and January 2011, Lippman conspired with others not to bid against one another and instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in Alameda and Contra Costa counties. Lippman made and received payoffs for the agreements not to bid, diverting money that would have otherwise gone to mortgage holders and other beneficiaries.
Department of Justice announced the guilty plea.
The charges are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Alameda and Contra Costa counties, California. These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-934-5300, or call the FBI tip line at 415-553-7400.
“This plea is the latest step in the Antitrust Division’s ongoing efforts to hold investors accountable for colluding at foreclosure auctions and denying lenders and homeowners the fair market value of their property,” said Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division. “We will continue to work with our law enforcement partners to investigate and prosecute collusion at real estate foreclosure auctions and to restore confidence in the housing market.”
“The negative impact resulting from bid rigging and fraud at public foreclosure auctions is far-reaching,” said Special Agent in Charge David J. Johnson of the FBI’s San Francisco Field Office. “The FBI remains committed to identifying such violations and we are grateful for the unwavering dedication to justice shared by all of our law enforcement partners.”
I confronted numerous fraudsters when I was in the business and they looked at me like I was crazy. “Of course it’s fraud”, they all said, “That’s how real estate works”. The banks couldn’t care less. The government didn’t care until it practically bankrupted the world. Let me assure you that the more fraud you commit, the more successful you will be in real estate. Straight-shooters don’t last a week.
Not so much *easy* to get away with … I think that, like many mortgage fraud crimes, people think there is nothing wrong with it. I was speaking to an investor a couple months ago who just couldn’t see the crime in bid rigging – thought that it was just a great idea for a good capitalist … and, while Microsoft is pretty aware of anti-trust law, I am not sure that most of the folks bidding at foreclosure sales are that keyed into it. Of course, anything that you whisper about and then go into a ‘back room’ to do should give you pause ….
There truly is every kind of criminal out there in the world. Interestingly, I’m seeing more and more real estate investors rigging bids. Is it particularly easy to get away with? At first glance, I wouldn’t think so.