John Rogers: Ponzi scheme?
 

Seems like when he wasn't throwing his good friend and business partner Doug Allen under the bus, John was stealing a lot of money.

Moral to this story: it's not all that difficult to pick out who the fraudsters are in this hobby as there is so much fraud to be had. If it smells disgusting, looks disgusting and acts disgusting -- it's usually bad news.

http://www.arkansasbusiness.com/arti...ks-123-million

http://www.arkansasbusiness.com/arti...ns-unpaid-bill

Interesting to see the purchase of the Jeff and Larry Fritsch collection.

I often wonder if something like this will be what eventually brings down some of the huge Ebay sports card consignment outlets, long before anything ever comes out of any sort of shilling allegations.

Their margins are so tiny in their effort to compete with auction houses and each other for what they charge for consignment rates, I don't know how they cover their overhead..........unless their consignments are somehow loss leaders for them to gain capital to purchase and sell their own inventory at higher margins.

Actual auction houses give themselves a much bigger margin for error with their takes. What these Ebay houses are doing, just seems very Ponzi'ish to me.

I occasionally take on Ebay consignments in my niche, and charge a rate I'm sure most around here would consider vulgar, and barely clear much of a profit at all on those items, after Ebay, Paypal and various expenses are factored in.

If I tried to compete with what Probstein, PWCC and others charge, I'd be in over my head in no time.

They pay a total ebay and paypal fee of 5.2% with a cap of $200-250 on any item. They make their money on the higher end items.

The absolute lowest Paypal rate is 2.2% + transaction fees alone. You're telling me that they're getting some sort of deal with Ebay, they only pay 3.00% on their sales? Not to mention anchor store subscription costs, Ebay taking a cut of shipping, chargebacks, returns, overhead, hiring people to scan, list and pack stuff for you, manning the phones, insurance, International transactions incurring higher fees, etc....

Higher end items...........they need to sell for over $2800 for that $250 cap limit to even kick in (if they count Top Seller discounts into the mix, it would be even higher then that). I checked out Probsteins Sold lots for the last 3 months. 65,000 lots sold................only 55 lots that ceiling actually kicked in for..........most on the lower end of that threshold, not making much of a difference.

I don't see it adding up. Seems like a House of Cards to me.

Dave, it works out for them just fine. One of the big ebay card consignment sellers sent an email looking for consignments. He was charging less that what it would cost me total. Ebay is making it work for these guys, and protecting them. The only downside is that you are generally supporting both fraud and an uneven playing field for other sellers, including yourself.

Well, there's one more downside - if you are not willing to shill your own auctions, and the seller doesn't have a group of lackeys doing it for you, then you are probably going to get screwed.

Quick math places gross revenue for one large seller at $48,000 weekly.

Yeah, I'm not denying that it's working for them, it obviously is. I just don't see it as sustainable. If the consignments ever dry up for them, or Ebay changes their policies in the wrong direction on a whim one day, I see the pyramid crashing down at some point, with a lot of consignors holding the bag for their bankruptcy proceedings.

Rogers got in trouble because he saw a burgeoning market in vintage photos and got greedy and tried to corner the market for himself.........but he could never sell the inventory anywhere near as fast as he was buying it. It was unsustainable, while at the same time he flooded the market with what he did put out there, and actually brought prices down considerably in many segments of it. The higher end stuff, will always be higher end stuff, but it obviously wasn't paying his bills...........especially when he apparently tried selling higher end stuff outside the market to unknowing collectors........that wasn't actually higher end stuff.

When you say "gross" do you mean total sales, or their total "cut" of the sales.

Most of that is going back to the consignors I imagine, with whatever left over to pay for overhead, labor, listing/merchant fees, etc......

That is revenue from their consignment fees. You then take out overhead to find their net. This is obviously "speculation".

Edit for misspellings.

More on Rogers
 

I just went to Fritsch's website, typed in t 206 in the search feature and all they have is reprint sets

Search on Walter Johnson and all you get is reprint sets.

Mickey Mantle, virtually the same thing.

Goudey, they have 11 singles, and couple Ruths.

Unless I'm doing something wrong..... it appears Larry's heirs liquidated all the cards, I hope they got their money.

Meanwhile ,what is happening with the Doug Allen sentencing ? what a great justice system !!!!!

Does anybody think these sentences will serve as a deterent to others? The funny part is that I don't see where it's had any negative impact to the PSA8 Wagner. Did anybody actually admit to trimming that card?

Oh yeah, as far as Rogers and Allen go, oh well... don't do the crime if you can't do the time... in their cases I bet the punishment doesn't even come close to matching the crimes...

As someone from Little Rock and knows Rogers well all I will say is he is getting what is well deserved....He used to own a small card shop before getting into the photo scheme and he made a boatload of cash and did not know how to handle it and a wifey that knew how to spend it. Back in the early to mid 90's when he had the shop I used to go there weekly as he had an incredible vintage inventory and fair prices. Then the photos, wifey and greed ruined him. How many card dealers are living in $2.5 mil home, driving exotic cars just too bad he was trying to stay 1 step ahead of a couple of local banks who finally tired of the chase and went after the millions they had loaned him. he deserves what he has received and then some.