Antitrust Law Daily Wrap Up, ANTITRUST NEWS: California real estate investor charged with bid rigging at public foreclosure auctions, (Oct 17, 2013)

By Tobias J. Gillett, J.D., LL.M.

The Department of Justice charged another California real estate investor with conspiring to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California last week. Felony charges were filed on October 9 in the federal district court in San Francisco against Kuo Hsuan “Chuck” Chang (U.S. v. Chang, CR 13 670, filed October 9, 2013).

Chang was charged with agreeing with co-conspirators to refrain from bidding on selected properties at public real estate foreclosure auctions in California’s San Francisco County, and instead designating which conspirator would win the selected properties. Chang allegedly engaged in this conduct from as early as October 2009 until in or about November 2010. Chang also was charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions in San Francisco County, to make and receive payoffs, and to divert to conspirators money that would have otherwise gone to mortgage holders and others.

The case against Chang is the latest charge filed by the Justice Department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in California’s San Francisco, San Mateo, Alameda, and Contra Costa counties. The earliest actions were brought in 2011. At least 36 other individual have pleaded guilty or agreed to plead guilty as a result of the investigation.

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