Antitrust Law Daily Wrap Up, ANTITRUST NEWS: California Real Estate Investor Admits to Rigging Bids at Foreclosure Auctions, (Feb 5, 2013)

By E. Darius Sturmer, J.D.

The Department of Justice Antitrust Division announced today that another real estate investor has agreed to plead guilty for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California in 2010. The investor, Gilbert Chung, is the 27th individual to plead guilty or agree to plead guilty as a result of the Justice Department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.

According to the government’s court filings, Chung conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in San Francisco and San Mateo counties. Chung was also charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs and to divert to co-conspirators money that would have otherwise gone to mortgage holders and others.

“The conspirators went to great lengths to suppress competition and prices at these foreclosure auctions,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division will continue to vigorously enforce the antitrust laws and to prosecute those who violate them at the expense of distressed homeowners.”

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