Maybe Calvindog Can answer this or anyone else with legal experience ?

If an item was put into Mastro's auction and illegal activity took place with inflated prices. Can the seller of the item who recieved an inflated price (Possibly
illegally) be subjected to a clawback of illegal profits that were realized. (Can what happened in the Bernie Madoff case happen in this case with illegal profits). Any info greatly appecieated.

http://www.suntimes.com/news/metro/1...raud-case.html

Allen’s attorney, Michael J. Petro said his client is “absolutely” planning to fight the charges — and pointed the finger at Mastro.

“Bill Mastro is the Mastromind,” Petro said.


LOLOLOL

That throws an Allen wrench into everything :(

Mastro must be petro-fied.

I think that's a definite "yes". But it may be hard to collect the alleged overpayment. If an item was inflated by 20%, say from $100K to $120K, then the auction house roughly collected an extra $3K in fees. The consignor received the rest. The extra $3K in fees are likely gone now (salaries, rent, profit, etc.) except to the extent that the guilty persons are held personally liable. But if they got rich over the business, they got rich over the fees, not the overpayment. So the consignor has the rest, $17K in this example, and good luck going back to him.

I don't imagine the government will be looking to 'clawback' any ill-gotten gains unless the consignors were in on the fraud.

When this is all over, Bill and Doug will be shills of their former selves.

You never provided the punchline to your last joke last night. Is that nice? You've kept me in suspense for hours.

I just dug this up. Yes, it's a lousy Photoshop job, but it wasn't for that reason that I got in trouble for posting it on this board shortly after the publication of "The Card." Well, it looks like we can now all agree that O.J. did it.

Hey, that's pretty good.

It's nice to see that Bill and Doug have been able to remain such good friends through all this.

I open the bid at: $5.00 on this rarity :)


AL

That's great. Gotta say, the level of schadenfreude I'm feeling right now is obscene. Honesty ain't that tough.

if the card is trimmed, and people don't care, and it doesnt take a hit in value like mr. anonymous said, and actually gains in value, just try trimming it a little more and see if you can get an 8.5 out of it.

I have to say that this quote brought me to a cheering, applauding roar! I felt like I was in the thick of one of Mcgreevy's Spirited Speeches. Standing in the middle of Boston's 3rd Base pub with a pint in hand as Barry... Ahhmm, I mean McGreevy, sprayed the best ale all over anyone in his speaking path as he carried out this victorious volley of wisdom.

Nuf Ced...

More investigations and arrests will clean the hobby up, unfortunately. Too much money to be made by fraud; the criminals need to believe there is a good chance they'll get caught and punished. End of story.

Now if they would go after Coaches Corner.

I am betting this is not the only high profile set of indictments that we will hear about. back in 2007-8 is the first I heard of this investigation. This may just be the tip of the iceberg so to speak.

probably right, when they agree to cooperate, like mastro did, they are required to tell ALL about what they know about illegal activity 100%, no holding back. and the feds are serious about it. wayne bray had to spill the beans about everything he knew, and they made him aware that they werent going to tolerate him holding back. I am sure mastro was a wealth of information.

How are they going to "require" someone to tell all? Maybe water boarding?How are they going to know if there is a shred of info not being told? My guess is the Feds base their decisions on what info is gained, not what is not gained. My understanding is that there are quite a few ex-employees that have given information. I think that is where a lot of it comes from....oh, and the subpoena's handed out....those probably rake in bit of info too. And the authorities probably talk to a lot of people in the hobby who aren't right in the middle of the issues. But these are all just educated guesses and maybe a tiny bit of first hand knowledge. As I told a good friend a few days ago, if I know something bad in the hobby, I have no issue sharing that with the proper authorities. I truly want this to be as clean of a hobby as is possible. I hope all of my friends feel the same way.

I think all Travis means is that if the Feds believe Bill isn't fully cooperating, they may not be lenient with him, and that would incentivize him not to hold back.

I can agree with that of course.

Cooperators are required to discuss ALL of their criminal activities, not just what reates to the case at hand. The government may want to make new cases with that info. Plus, a defense lawyer for a client who knows Bill so well most likely knows about a lot of this unrelated criminal activity and will surely cross examine Bill on it during the case. If Bill holds back his cooperation deal could be ripped up and he'd spend a longer time in jail before being released and going back to washing the lepers' feet. Bottom line: the Feds don't need Bill's cooperation to convict Doug so if Bill has an ounce of a brain left in his sainted head he'd best come clean.

Which means: whoever else conspired with Bill on a crime which was either Mastro Auctions-related or not should be very nervous right now.

From what I can tell these guys hired fairly big name, and therefore expensive, criminal defense lawyers out here.

Unless they have prior criminal records I would ultimately expect assorted plea agreements that might bring others down and would lead to penalties -- fines and perhaps agreements barring them re-entering the sports memorabilia business for a while or life -- but no real prison time.
What may be brought to light along the way could of course expose them to civil liability if the harmed individuals want to pursue it and that's way the plea agreements are a rather tricky test for the charged parties and their lawyers.

This will become yet another part of the saga of the card, Wagner T206, in general. The specific "altered" card will no longer universally acclaimed as the "best one" -- it will remain the most famous specimen.

T206 Wagners generally will continue to be the "most famous, most valuable, and rarest baseball card" (yes I know its not the rarest by a long shot and that a certain low end Wagner is not more valuable that the highest end of specimen of some other cards but that's the narrative to the outside world)

I disagree with nearly all of that.

That's fine.

someone will be doing some time in prison for this.....how long, remains to be seen. High priced lawyer or not. Tip of the iceberg most likley

I was once told by a Federal law enforcement agent that they only indict people when its pretty much a slam dunk of getting a conviction. Of course the Clemens trial proved that wrong, but that could be explained away by relying on Andy Pettite, graduate of advanced studies from the Frank Pentangeli School of Witness Testimony. See training video below:

http://www.youtube.com/watch?v=90XT5GWlKaE

Had it been established who the cutter was?

I think the idea of a "slam dunk case" is very different from a defense lawyer's perspective.

+1

Can we bring you in as an expert witness on this point? ;)
JimB

Very true.

All three will walk

Walk where? And one of the 'three' appears to be cooperating with the feds as hinted by his lawyer.

No where in particular. Just a morning stroll.

If you had your way, they would be walking the plank.

Well, they ARE great guys.

the "perp" walk

Just brings to mind the Malcolm in the Middle perp walk scene. The father (Bryan Cranston) was arrested at his home, but it was a minor crime so the cops did the perp walk on his front lawn.

And why would anyone think otherwise?

Has Legendary sent out a mass email addressing the indictment of its top executives? I've been banned from bidding in their auctions for a while so I'm unsure whether they've addressed the events of last week. Considering the angst that would-be consignors and bidders surely must be feeling now, I can't imagine that Doug hasn't at least confirmed that the company is a going concern, that he will not be leading the company until his criminal fraud charges are resolved, etc. Anything?

Haven't seen anything. Seems the MO of auction houses that are under fire is to duck and cover.

What happened to the presumption of innoncence?

Well Peter, he did say "charges". I was kind of curious of that too. From the few emails and snail mail I have received from Legendary I haven't seen anything to address the issue. That might not be a bad strategy though at this point. I hope this whole mess gets over with quickly and we can move to more positive things in our hobby. I can't be "happy" about the whole situation.

Right, I am just questioning Jeff's suggestion that Doug has an obligation to step down until the charges against him are resolved. That sounds like a presumption of guilt. That said, I am not sure playing ostrich is a great PR strategy with a major auction coming up and others in the pipeline.

Which word did I mention which suggested that there was no presumption of innocence? And does the presumption of innocence prevent the government from freezing the assets of an entity which could be claimed to be proceeds of a crime? Does the presumption of innocence come with a guarantee that all businesses operated by those under indictment are required by law to remain open and not be forced into bankruptcy? Ask Arthur Andersen about the pre-conviction impact of an indictment.

And it's not a presumption of guilt for the top executives of a business to step aside upon being indicted for fraud in the very type of business that they are running. More like common sense.

Jeff, I am not sure Legendary is big enough that its two top executives can simply step aside while the judicial process plays out. It certainly will be interesting to see what impact, if any, this has on the upcoming auctions.

They're not so big that they can't address the 600 pound gorilla sitting in the corner.

Would you feel better if they sent an email saying we deny the charges and intend to vigorously contest them?

No, they've already said that in the papers through their lawyers. I think it prudent that they at least address the impact if any the charges will have on their business, their consignors, their customers, etc. and what, if any, efforts they are making to ensure that Legendary will be a going concern. Don't the people who have spent millions of dollars with Legendary and Mastro at least deserve that?

Maybe Leon will get another message on his voice mail. :D

I doubt it.

And not like I am a pushover but I have to concur with Jeff. They do have at least one executive not indicted, with 30+ yrs in the industry, that could easily temporarily fill in. I think an interim president wouldn't be a bad thing to consider. It's not my company but I do have a small vested interest in the way of some consignments coming up. I had to rob Peter to pay Paul (irony intended) as I am a hopelessly addicted type card collector and had to pay for my last winnings somehow :). I will mention that Doug has always helped in some of my collecting endeavors. The rest remains to be seen and of course if I was ever shill bid I won't be the happiest collector, nor would anyone.

Just a rumor, but I've heard that they are putting the finishing touches on mug shot promo cards for distribution at the National. The cards will feature a "Criminal Code of Conduct" on the verso of the booking photo.

Mastro and Legendary Auctions have nothing to do with each other. Just because all 3 people used to work for Mastro Auctions and commited fraud, does not mean that the two that bought out Mastro, sold his collection for him, have all the Mastro auction results on their site, etc., should mean anything to current consignors as they surely have not done anything wrong since. (tongue in cheek smiley)

David davis

Indeed !

Ok, everyone relax. I saw the email from Legendary. It didn't explain anything regarding the indictments of its top executives for shill bidding -- but it did invite bidders to make maximum, online proxy bids for its live auction this week.

I love America!!!

Craig "Proxy" Helling?

Of Golden Balls & Elvis Hair
 

Golden Balls Auction:

http://www.legendaryauctions.com/Lot...px?lotid=34377

What do we make of the red text at the top of the auction description? Does it help their case?

Elvis Hair Auction:

Also, with respect to the Elvis hair, what do we make of the note in the letter of authentication that "it is my opinion that short of comparing mitochondrial DNA with that of known Presley relatives, the hair in the bag is also authentic."

http://www.legendaryauctions.com/Lot...px?lotid=88257


Can Mastro/Legendary successfully shield themselves from liability by putting (albeit weak) disclaimers and conditional lines in their auctions and/or letters of authenticity?

My prediction is pleas of guilty from all involved, but no jail time -- only probation.

Paul, in my judgment if a seller omits material information that casts doubt on an item's authenticity, a disclaimer doesn't protect it against a fraud claim.

I think the (albeit weak) conditions and disclaimers will go to whether the auction house made any "false" representations. Here's the lingo for mail fraud. 18 U.S.C. § 1341 provides:

Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, or to sell, dispose of, loan, exchange, alter, give away, distribute, supply, or furnish or procure for unlawful use any counterfeit or spurious coin, obligation, security, or other article, or anything represented to be or intimated or held out to be such counterfeit or spurious article, for the purpose of executing such scheme or artifice or attempting so to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or deposits or causes to be deposited any matter or thing whatever to be sent or delivered by any private or commercial interstate carrier, or takes or receives therefrom, any such matter or thing, or knowingly causes to be delivered by mail or such carrier according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any such matter or thing, shall be fined under this title or imprisoned not more than 20 years, or both. If the violation occurs in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection with, a presidentially declared major disaster or emergency (as those terms are defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122)), or affects a financial institution, such person shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both.

I'll revise my initial prediction of probation, to include a substantial monetary fine and, of course, restitution. But, I'm still going to say no jail time. I also think Legendary Auctions will survive this particular blow.

Paul, I'll take that action all day.

Even Alfred Taubman, convicted Sotheby's price-fixer, was sentenced to just a year and a day in prison -- though he was fined $7.5 million. And how about Diane "DeDe Brooks" who did 6 months house arrest? Do we think what they did was better or worse? And when did Sotheby's go out of business exactly?





A Taubman's Bidder End. Sotheby's Big Prison-Bound as Appeal is Nixed, John Lehmann, New York Post, 07/26/2002, p. 16.
The Post reported here that "Convicted Sotheby's price-fixer Alfred Taubman has consigned himself to becoming a multimillionaire inmate next week after his appeal was thrown out yesterday."

A three-judge appeals panel in Manhattan heard his appeal and ruled that any errors in his price-fixing trial were "harmless."

Mr. Taubman was sentenced to a year and a day in prison and fined $7.5 million. Apparently the extra day made the sentence just long enough to qualify for early release.

At the hearing before the appeals panel, Mr. Taubman's lawyers brought yet another name to the attention of the public. They accused another ex-Sotheby's board member, Lord Thomas Camoys, of conspiring with Christie's chief Sir Anthony Tennant in April 1995.

Mr. Taubman's lawyers also objected to a quotation used by the prosecution in summing up the case to the jury. The quote was from the economic classic, "The Wealth of Nations" written by the 18th-century economist Adam Smith. The quote said, "People in the same trade seldom meet together even for merriment or diversion, but the conversation ends in a conspiracy against the public and in some contrivance to raise prices."

The Post then reported that in their decision not to grant the appeal, the Court ruled that the government had relied on 'the overwhelming direct evidence of Taubman's knowledge of and participation in the conspiracy."

* * *

Sotheby's Convict is Sprung, Adam Miller, New York Post, 11/10/2002.
Mr. Miller wrote here that "Disgraced auction empress Diana 'DeDe' Brooks laid low yesterday, a day after she completed her six months of house arrest for her role in a price-fixing scheme."

He explained that the former president of Sotheby's was sentenced earlier in the year after pleading guilty to fixing commissions and fees with rival art auction house, Christie's, and testifying against Alfred Taubman, her boss, who was sentenced to a year and a day for his role in the conspiracy.

He also wrote that "the deposed auction queen" also received three years probation, a $350,000 fine and 1,000 hours of community sentence and that the judge called her "a thief and a convict."

Failure to disclose a known material fact is a textbook definition of civil fraud. In the face of that, a disclaimer is useless. Is this somehow different under the criminal mail and wire fraud statutes? I doubt it. It certainly sounds like "false pretenses" to me.

Sotheby's is a bit player compared to Mastro!!!

I'm not seeing this. Sothebys did 5.8 Billion in 2011 with over 1400 employees.

Mastro wasn't even in that league were they?

Steve B

Peter was being sarcastic....note the three exclamation points.

Again, I'll take that action all day and night.

Does size really matter when you are evil incarnate?;)

Touche! LOL

Then you'd be willing to give me odds?

Interesting to see Mastro's lawyer play the "lifelong religious good deeds doer" card.
I agree with leon's comment about how if he found out he had been shilled in bidding in Mastro auctions in the past, he would be infuriated. I would too, but how in the world will we ever know? We can suspect we were, but realistically we will never know. The mere suspicion of shill bidding lead me to quit making high proxy bids and instead end up staying up in to the wee hours and placing a bid on lots I wanted near the end of the auction.
Personally I know Doug Allen, as many on the board do, and from a personal standpoint I hope Doug comes through this all right, but, again like some on the board, I find all this very troubling and worrisome :(
I agree with a former poster who alluded to the fact the feds don't normally like to indict unless they believe they have an iron clad case, but they do occasionally make mistakes, usually in conspiracy cases or cases with multiple defendants.
What a mess......

The card
 

I picked up the book - THE CARD - in a book store and read the entire thing. It opened my eyes to the grading / auction world.

I would only get cards graded for the purpose of being slabbed for preservation. PSA have been less than consistent in their grading. I cannot say if there is bias to high end customers or preferred clients.

Like any endeavor that makes money, the temptation to fraud is always present. Research, ask questions and go with your gut instincts.

Missed the exclamation points:confused: Maybe the internet has made my mind automatically ignore them.

I suppose size doesn't matter when it comes to people or companies doing bad things. It shouldn't.

But the sothebys guy did 10 months for some anti trust crime
And a bunch of bankers did far less if any for stupid but maybe not criminal stuff and didn't even lose their jobs.

I have no doubts about how much of the 20 years I'd do if I did some sort of postal fraud. (Likely most of it)

I'm not sure where fraud ranks on my mental "evil incarnate " list. Probably not in the top 50. It's bad, but there's lots of worse things.

Steve B

Have you ever heard of a one screw? It has the same level of protection for less then 5% cost. Plus, you can take the card out if you want.

Steve, I agree. I would place card doctoring much higher on the list of evils than shill bidding, for example. The "evil incarnate" thing was tongue-in-cheek, directed at a certain poster's obsession with Bill and Doug.

I ate a neighbor once, but have never bid an a Sotheby's auction. Should even out getting into Heaven-wise.

That's just a joke. I have bid in a Sotheby's auction.

Mastro and Allen Indicted
 

I heard MSNBC is gonna change the name of Lockup RAW to Lockup Authentic.

Well then, at least they didn't.....hmmm

Bill and Doug....:D somehow when it's first names only it sounds like two guys from Canada.

Now I'm hoping one of the photoshop guys picks up on it.

Steve B

I believe that the Justice Dep't believes that everyone who is convicted in this case deserves jail time. And, they will probably get it.

As an aside, in the event convictions are obtained, I see this case as a vindication of Jeff (who I don't know) who, far moreso than anyone else, had the chutzpah to call out Mastro for these alleged activities months ago.