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Wednesday, February 12, 2014

Foreclosure bid rigging costs three their freedom

By Wes Thompson

During the housing crisis and subsequent economic slump between 2007 and 2011, most people were struggling to make ends meet. Millions of homes went into foreclosure, and California was one of the hardest hit states in the country. Still, the economic hard times brought out the worst in some people. There are many people who look to capitalize off of tragedies, and the housing crisis was certainly a tragedy for many. Recently, three real estate inventors pled guilty to committing mail fraud and rigging bids and foreclosure auctions in the San Francisco Bay Area. They were, in effect, preying on the unfortunate circumstances of the housing crisis for their own personal gain.

According to the U.S. Department of Justice, Leslie Gee, Rudolph Silva, and Thomas Bishop were all suspected of bid rigging in Contra Costa County foreclosure auctions. The three conspirators were essentially working in cahoots to ensure that at least one of them won foreclosed homes in auctions. Their plan was to attend foreclosure auctions in the county and not bid against one another so as to make the odds of winning much easier. All three gentlemen can be convicted for up to 30 years in prison and $2 million in fines, which is certainly a strong deterrent to any other foreclosure schemers.

The three individuals were also accused of acquiring Contra Costa County titles fraudulently through the mail. The justice department also noted that these conspirators were able to divert money that should have gone to the defaulted homeowners. All of these crimes occurred between the years of 2008 and 2011, proving once again that anyone will try to capitalize on the pain of another. Fortunately for all of California’s residents, these three former real estate investors likely won’t have the means to continue defrauding distressed homeowners.

Foreclosure auction
Riggin foreclosure bidding prices at auctions is illegal

That being said, these three individuals were a part of a much larger ring of 43 co-conspirators who have been defrauding people since 2008. Their arrest was a part of a concerted effort by the FBI to locate and neutralize the fraudulent string of Northern California scammers. The FBI is also trying to educate the public about bid rigging and its criminalization. Many people might not think they are committing that severe of a crime by rigging foreclosure auction bids, but, the potential for 30 years in jail is certainly daunting by any stretch of the imagination.

During that period between 2008 and 2011, California saw its highest rate of foreclosures in years. Of course, it’s always unfortunate to see someone get defrauded especially when they’ve undergone lengthy foreclosure proceedings. But, if you or anyone you know is thinking about rigging bids in any way, then it’s important to take note of the fates of these conspirators. It’s clear that rigging bids might provide you with a momentary feeling of success, but you must understand that it’s all very fleeting. It’s also a very serious crime even if it might seem like small potatoes to you. In the end, try to avoid fraud as best you can.

About the author: Wes Thompson is an investor and financing expert from Minnesota. He invests primarily in real estate foreclosure and tax lien sales.

Image license: Casey Serin, CC BY-SA 3.0