Mastro Auctions Being Investigated by the FBI

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Posted By: barrysloate

When you type a colon and then a parenthesis, it turns into a smiley face when you hit "respond." Try it!

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Posted By: ErlandStevens

You must also leave the "enable formatted text" box checked. If it's unchecked, a will just look like a couple punctuation marks.

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Posted By: barrysloate

I never knew that, but I just looked at my box and it is checked. Don't ever remember doing that.

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Posted By: ErlandStevens

Another weird thing... If you uncheck "enable formatted text", the : ) will still show a :) in the preview. Hit respond and you just get : ).

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Posted By: ErlandStevens

That last post made no sense b/c the box was unchecked. The point was that checked or not, you will get the smiley face in the preview.

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Posted By: Bob

I think I now have Excedrin headache #206 from reading 120 posts on the Mastro situation.
Rather than rehashing, I have 3 things to say:
1) I think Doug Allen is a really nice guy but to think he would come here and "tell all" is ludicrous. His attorney would cuff him (literally) on the back of the head. The FBI certainly doesn't need the help of any comments he might make on the Net54 Board, however innocuous, in making its case against Mastro, if Mastro is in fact being investigated.
2) No one likes shilling and if in fact (big IF) Mastro was involved in that, then katy bar the door they should be put out of business for its practice. This all remains to be proven and we shouldn't jump the gun.
3) Anne Coulter is trash. Pure, unadulterated white trash. She could easily be pictured in a long black trench coat, blonde hair tightly pulled back, and a swastika on her arm in 1936 Berlin. There are conservative commentators and political observers who I might not agree with but respect and who are decent, intelligent people. Coulter is not one of them. Her comments about John Edwards' deceased son shocked even the most conservative of my friends and revealed the guttersnipe for what she truly is- white trash wrapped up in a sleek package.

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Posted By: jay behrens

Imagine if the name Mastro was removed from the discussion and replaced with some lower level auction house/dealer from eBay. Now imagine the unrelenting hammering they would get for something like this.

This board can be very hypocritical at times.

Jay

I love pinatas. You get to beat the crap of something and get rewarded with candy.

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Posted By: D.C. Markel

In my many years of collecting, I am aware of several investigations by the FBI pertaining to sports collectibles. Some were legitimate where people were arrested and convicted. However on the complete opposite side of the spectrum, I can recall not too long ago where one FBI investigation was initiated and quickly closed and no arrests were made. In short some despicable eBay dealer filed various trumped-up criminal charges against a collector as a means of retaliation for giving the seller negative feedback on an eBay transaction. So the bottom line is Mastro could be in big trouble or they could just be the unfortunate victim of some disgruntled party. When arrests are made, I will take notice.

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Posted By: peter chao

The old adage is "where there's smoke, there is fire." It's pretty simple, the Feds will indict only if they believe that they can convict. This is quite different than if Mastro is running a shilling operation. It is quite difficult in this situation to get sufficient evidence. There may be shilling going on but the Feds do not believe that they can convict and may never ask for an indictment.

For instance, almost everybody believes Barry was using steroids, but so far the Feds have not indicted. They are being held back only by the sufficiency of the evidence and not by whether they believe he took steroids.

Peter

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Posted By: Anonymous

IMO Mastro would make more money and be more respected if they hired someone to validate and remove potentially altered cards instead of altering them.

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Posted By: Jeff Lichtman

Kevin, very succinct and very correct. However, as Leon correctly points out, Mastro is in the business of making money which includes altering cards that they can then sell for more money. Removing cards from their auctions that are altered would cause them to lose money. Bad business model.

Peter, my mouth is agape once again. Is there a 'mouth agape' emoticon?

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Posted By: Jim Crandell

Peter,

Forget what Jeff tells you--I know who I am hiring if I need a first rate lawyer..

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Posted By: Rob Dewolf

This is you being controversial again, right?

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Posted By: Jim Crandell

Rob,

Don't know--have never said anything to Peter before but he broadsided me a little while ago with the comment about how he was sure I made some contributions to the board but he couldn't think of one.

Just want to let him know he is my man when I need legal help.

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Posted By: davidcycleback

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Posted By: peter chao

Jim,

Thank you for your confidence in me. However, I'm not offering brilliant insight here. That's the reason why the Feds have put so much pressure on Greg Anderson to testify. It is also the reason why Greg Anderson doesn't want to testify.

Peter

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Posted By: Jim Crandell

Peter,

My decision to choose you as my attorney of choice is not based on one comment but the cumulative wisdom you have shown since you have been posting.

Keep it coming.

Jim

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Posted By: Jeff Lichtman

Um. The delicious irony in Peter's last post is almost too much to resist. So many layers of irony. I...must...refrain...from....commenting (in best William Shatner "Star Trek" era voice).

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Posted By: Jeff Lichtman

David, I was thinking more along these lines:

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Posted By: Bruce Babcock

If Barry (Sloate) is indicted for steroid use I'm leaving the hobby.

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Posted By: barrysloate

I weigh 150 pounds!

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Posted By: leon

You said

"Will await your response on Rob."

I think that is the 3rd time you have asked me to respond to something and this will be the 3rd time I say "to what?". Show me where Rob said something about Mastro Auctions, and not the shipping debacle which was a printers fault, and I will be more inclined to comment....Not saying I would but I at least would know what the heck you are getting at.....regards

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Posted By: JimCrandell

Leon,

I gotta tell you--you have a unique way of avoiding the question--I told you what was said earlier.

It was the hobby news story of the year when Rob came out with his slam which I quoted that everyone assumed was about Mastronet--Doug even responded that since he was the only house that dealt with raw cards that therwe was vnoone else he could be talking about

So avoid the question--fine--I just wanted to give you a chance to defend your buddy.

Jim

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Posted By: Frank Evanov

Jim, when you state that Peter C. is your choice to be your attorney, you are supposed to add the wink icon!

Frank

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Posted By: JimCrandell

Frank,

You are expecting too much. I just learned how to do the smile icon today--I will master one per week.

Do you know much about the Horrors of War set?

Jim

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Posted By: leon

Ya know...I just wrote a blistering paragraph and deleted it. I have nothing left to say to you. We collect and think differently.. Have a good one....

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Posted By: jay behrens

Jeff, it may be a bad business model in respect to Mastro's goals, but it is the stated business model of REA. Rob Lifson has stated he won't accept card or other items he knows to be altered. Given Rob's reputation, I doubt that his business will be hurt at all.

Rob is the one true beacon of light in all this mess

Jay

I love pinatas. You get to beat the crap of something and get rewarded with candy.

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Posted By: Anonymous

Every once in while (OK, more than once in a while), REA likes to communicate about issues that we think deserve attention but for some reason are receiving little or no attention. There are several topics that we would like to bring to the attention of buyers today, in the hopes of educating buyers and maybe saving someone money.

1) Practically every day we are seeing fake items. Fake printed items. Posters that are actually reproductions of vintage posters. Stand-up cardboard counter displays that are not real. Babe Ruth Candy wrappers that are not real. Fans that picture baseball player portraits that are reproductions. Photographs that appear to be old but are not vintage. There is no limit to what can be made with computers, especially with printing equipment available today that is very economical and which years ago did not even exist. These items are being intentionally made to fool people into parting with their money for worthless items. These items are being made to cheat buyers. Many of these items are somehow reproduced from books and auction catalogs, often enlarged from small quality illustrations to their correct original size. With computers these days, it is possible for some criminals to produce very real-looking reproductions and also to produce "fantasy pieces" (defined as those items that are not actually reproductions, as there is no original, but are made to look old to fool buyers). This is a BIG problem. These items are offered to us practically every day, and they are being offered to us by collectors who themselves are victims. Most of the sophisticated fake items of this type that we have seen appear to have one thing in common: They were purchased by sellers in the state of Ohio. It is obvious to us that the individual(s) responsible for most or all of these imaginative quality fakes is located in the state of Ohio, though these items are now circulating throughout the country. It is easy for us to tell in almost all cases whether an item is real or not, often just from a scan. We understand from experience that not everyone can, including the numerous victims who have sent us these recently produced fake items which at a glance appear to be vintage items. If you think that you have purchased a fake item of this type and would like our opinion, we will be happy to be of assistance. Please write and/or send scans.


2) In recent weeks we have received a number of consignments of graded cards that has motivated us to adopt a formal policy regarding altered professionally graded cards that we have not previously seen a need to articulate. The altering of cards is so widespread, and "card doctors" so brazen, that REA has actually been receiving cards submitted for auction to us that are the very same cards that have been sold by REA previously - in some cases just months earlier - and which, since purchase, have been significantly altered, reholdered, and now grade higher according to the grading label. In some cases a given card has changed hands and the new consignor was not even aware it was a seriously altered card. It is our policy that when we are aware of such a problem, and we ARE looking, we will be happy to auction the card in question - but insist on providing all information describing the alterations which have occurred to the card of which we are certain. So far, the potential consignors of such cards have elected to have these cards returned rather than have a proper description provided by REA. Last week we returned a $10,000 card. The consignor couldn't believe it was the same card that we had just sold (in a lower grade and looking quite different) in a previous auction. Only after being provided with images of the card as it appeared when we previously sold it was the consignor finally convinced.

We're not guessing here. We are talking about cards that we know for a fact are problems. The fact that we have to address situations such as this at all suggests a greater underlying problem than is generally recognized. And while it is bad enough that the altering of cards is an epidemic, it is particularly disturbing that some of the most sophisticated "work" on cards (including the previously mentioned $10,000 card) has actually been executed by employees of auction houses that also deal in cards. We have to ask ourselves "What is going on here?" Turning a blind eye to this issue, in our opinion, has far greater and more significant negative potential consequences than our calling attention to it and promoting discussion. We all know that there is a subjectivity to grading and that sometimes there is an honest difference of opinion regarding a grade, or sometimes even an honest mistake. We're not talking about honest mistakes here. Active and sophisticated collectors, dealers, and auction houses know that this is a problem. They just don't talk about it, except among themselves. In the end, the collector loses. We want to be clear that we think the major grading services do a valiant job and we can't imagine what the landscape of the marketplace would look like without them. That doesn't mean there are no problems. At the end of the day, we have this advice: "Buy the card, not the holder."

3) REA highly recommends reading the just-released book "Operation Bullpen, The Inside Story of the Biggest Forgery Scam in American History". If you collect autographs, or have an interest in the field in any way, (or just like a great crime-related book), this book is required reading. This is a great book that we think every collector should read. You can order the book online at www.OperationBullpen.com or call Southampton Books at (707) 747-4705.

REA has never been shy about calling attention to what we think are significant problems and issues facing the field. It is our hope that openly communicating about issues which deserve attention, which are so important to so many people, will help us to come up with better ways to address these issues, and in the long run will have a positive impact. That's how progress is made. Your ideas and suggestions are always welcome.

Sincerely,

Robert Edward Auctions LLC
www.RobertEdwardAuctions.com

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Posted By: P Spaeth

Pete C. I would leave the criminal law to Lichtman and stick to "class auctions."

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Posted By: leon

If that is the letter I am not sure what the inuendos would be so I won't comment on it. Like I said, most likely I wasn't going to comment on what Rob said anyway. I don't feel it's my place. I think altering is important to the hobby....just not as important to my collection and what I really want to talk about every day on the board. If others do then that is fine...I will try to be intelligent when I acquire cards (eyes wide open with help from folks like Kevin) and focus on the pleasures of the hobby. Quite honestly if anyone that only collects plastic wants to participate in a forum maybe they need to find a board talking about polymers....

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Posted By: P Spaeth

Being holier than thou can be a difficult ground to stake out for oneself.

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Posted By: Jerry Hrechka

Jim
The 2 guys to speak with about the HOW set are Marty Quinn and Mark Finn. I know Mark has posted about his problems with Mastro where he didn't receive all the items listed in a Mastro Lot (And the rarest items - Original artwork of high number R158 Gum Inc. Home Defense - were the ones he got short changed on). As far as I know he got banned from bidding on Mastro Auctions. He posted about his problems with Mastro on the NonSport board.

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Posted By: JimCrandell

Rob Lifson--"some of the most sophisticated work on cards has actually been executed by employees of auction houses that work on cards"

Doug Allen essentially replied--we are the only house that fits that description but we don't do sophisticated work on cards.

Leon--"no comment"

Thank you OSeedy for posting this extremely important letter.

Jim

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Posted By: JimCrandell

Thank you Jerry--I looked at the registry and referred a long-time participant on this board who asked to you and Marty.

Jim

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Posted By: leon

What's important to you and most of the rest of the board are two entirely different things. Have fun anguishing over your plastic...

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Posted By: Dave F

Crandell
I've bit my tongue throughout this whole thread. But once again you come out of the depths of blackness everytime anything related to this subject comes up. You have said you don't read this board...yet obviously you do...you never miss a beat when the time comes.

Its amazing how you can continually badger pretty much the same five or so people on this board. Its certainly tiresome. Reminds me of the possum that keeps getting in my trashcan.

Dave

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Posted By: JimCrandell

It is fun Leon--I'm a true collector--every card in every set I collect and I like it in high quality. I also like it unaltered as do most on this board. Card alteration is widespread in ungraded cards, it is widespread in low-to-mid grade and now its permeating high grade. As one leading national dealer e-mailed me yesterday--"the funny thing is that collectors think that ungraded cards aren't just as much if not more impacted(by alteration)than graded cards".

If you want to ignore all this and get in your digs against me fine--your supporters and my detractors will no doubt come to your defense.

But in the hobby as a whole there is increased recognition of it every day--just look at where we are now versus six months ago...and it has the potential and I would say even the liklihood of continuing to change the hobby for the worse each day it goes unchecked.

Jim

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Posted By: Peter Spaeth

To be clear my holier than thou comment was addressed to the REA letter not anyone on this board.

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Posted By: jay

Like i said before, the grading services killed the coin business and it will kill the card business

It's ashame that Mastro will be remembered as a major crook in this hobby.

His Company along with the grading services (psa, sgc) should all go down together. They are one big family that have been screwing collectors over for years so that they can get richer.

There's an old wise saying "greed ($$$) eventually leads to suffering (caught by FBI)"

REA is doing a wonderful job in pointing these problems out.

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Posted By: Kevin Saucier

"To be clear my holier than thou comment was addressed to the REA letter not anyone on this board."


Hi Peter, I read that last night and was still laughing when I woke up.

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Posted By: E, Daniel

"The old adage is "where there's smoke, there is fire." It's pretty simple, the Feds will indict only if they believe that they can convict. This is quite different than if Mastro is running a shilling operation. It is quite difficult in this situation to get sufficient evidence. There may be shilling going on but the Feds do not believe that they can convict and may never ask for an indictment.
"


Great stuff Pete C. You now have Mastro guilty of wrongdoing regardless of there being any evidence to support the allegation. I think you're participating in the old adage, throw some **** and some of it will stick.

Awesome!



Daniel

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Posted By: peter chao

Daniel, Kevin

An investigation is just an investigation...but the FBI seldom investigates if there is no evidence.

Peter

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Posted By: Rob Dewolf

Peter,

So you're saying that -- typically -- the FBI would need evidence of a crime having been committed before they would begin an investigation?

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Posted By: JK

Actually Peter,

The FBI will investigate complaints, leads, etc. - usually the investigation turns up the evidence, if there is any to be turned up. In this case, its my understanding that the FBI is investigating a complaint of shill bidding.

Also, Im no criminal lawyer, but I always thought that guilt was determined when the evidence of said guilt was beyond a reasonable doubt. Not when there was just "some" evidence.

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Posted By: peter chao

JK,

Like Peter S. says, I should leave criminal law to Jeff, I'm just giving you a layperson's opinion here.

The FBI recieves a lot of complaints all day long. The complaints themselves is potential evidence. They have their own internal standards as to which complaints they will pursue and investigate.
They do not pursue every complaint.

Normally, when they are investigating they are looking for additional evidence.

Peter

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Posted By: JK

Peter,

First - I never said the FBI investigates each and every complaint that they receive. One would assume they have screening mechanisms in place. Second - a complaint, in and of itself, is not evidence. Its an allegation. Though I agree that when a complaint is made, it may be accompanied by evidence.

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Posted By: leon

Seems like if there were an investigation going on by the FBI that the President of Mastro would have ever spoken to them or know about it. They haven't and all this is, is pure gossip. Not one shred of absolute evidence that there is an investigation going on at all. Not one. All we have is some guy (O'keefe) running at the mouth writing a ficitional column. Did Noe do stuff wrong? Absolutely and was found guilty. That's all there is...... Doug has never spoken to the FBI nor is he aware of an investigation, he told me this morning. I told him there is no way he should come on this board to have the few folks that don't like Mastro twist his words the way they always do. Until I see something that proves there is an investigation going on then I feel this is all a contrived bullcrap story. Prove me wrong or shut the hell up...

edited grammar

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Posted By: JimCrandell

Peter,

We find it much more interesting to hear your interpretation of criminal law than Jeff's. Keep on giving us your views .

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Posted By: davidcycleback

The presence of evidence doesn't automatically mean anything bad happened. In fact, evidence regularly exists when someone is innocent. If a customer was at a bank the day when money was stolen: that is evidence that he committed a crime. There may be other evidence that shows he didn't steal the money. A look at video tape may show he left at noon, not returning that day, while the money was stolen as 4.

Say one person committed a crime and the police say, "There is evidence that one of you five guys committed the crime." This is evidence against each of the five, but does not equate with all five having committed the crime. In fact, it literally equates with 4-5 not having committed the crime.

While I'm sure they don't wish to waste their time, the FBI 'looking at evidence' does not automatically equate with guilt or even a crime. The FBI may decide that the evidence shows a crime was not committed. One can't determine innocence or guilt before looking at the evidence.

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Posted By: PSpaeth

If it was already reproduced my apologies, Leon please delete.


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FBI probes hobby biz honchos

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BY MICHAEL O'KEEFFE
DAILY NEWS SPORTS WRITER

Sunday, July 8th 2007, 4:00 AM


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Print Email Suggest a Story
The Chicago division of the FBI, whose "Operation Foul Ball" smashed a multistate autograph forgery ring during the 1990s, has initiated an investigation into Mastro Auctions, sports memorabilia's largest auction house.

At least two hobby executives have been questioned about Mastro Auction's business practices in recent weeks by the FBI, the Daily News has learned. So has the president of Development Specialists Inc., the company hired by the state of Ohio to liquidate coins and collectibles purchased with state money by Tom Noe, the Republican Party official convicted last year of stealing from a $50 million workers compensation fund and sentenced to 18 years in prison.

"We have talked to the Chicago office of the FBI about their investigation and we are deferring some of our activities in deference to their investigation," DSI president William Brandt said.

FBI spokesman Ross Rice said he could not confirm or deny an investigation into Mastro Auctions was underway. Mastro Auctions president Doug Allen said he was not aware of the FBI investigation.

"We have not been contacted by the FBI or by the police," Allen said. "I have not heard anything about it."

Indiana memorabilia dealer Bill Daniels, one of the hobby executives questioned by the FBI, said he provided information about "shill bidding," when an auction house or a consignor enters fake bids on an item in order to drive up the price.

"I gave them the name of a consignor who bid on his own lots in Mastro Auctions," said Daniels, who was interviewed by an agent about 10 days ago. "I think this is a big problem. It is not ethical for a consignor to bid on his own lots."

Daniels sued Mastro Auctions last year over a collection of 2,000 autographed photos he purchased in a December 2004 Mastro sale. Daniels claims the lot includes numerous forged autographs, as well as damaged photos and smeared signatures. An Indiana judge reviewed evidence from both sides this spring and is expected to issue a ruling this month.

"One thing I discussed with the FBI is the fact that during discovery, Mastro could produce no records about the lot," Daniels said. "They could not produce records about who the runnerup was or whether there were even any other bidders."

The other executive, meanwhile, confirmed that he has been questioned by the FBI but declined comment for this story.

As The News reported last year, investigators who searched Noe's Vintage Coins and Collectibles in Maumee, Ohio, in 2005 found a cache of collectibles - everything from Beanie Babies to 19th century political banners to autographed baseballs - worth an estimated $3.5 million. Authorities believe the GOP fund-raiser bought most of the collectibles with state money; a major source of the memorabilia was Mastro Auctions of Burr Ridge, Ill.

Brandt said Mastro Auctions has not cooperated with DSI officials as they attempt to recover and liquidate assets Noe bought with money from the Ohio Bureau of Workers Compensation fund. He said attorney Randy Mastro, a deputy mayor under Mayor Rudy Giuliani and the brother of Mastro Auctions founder Bill Mastro, has told him to "pound sand."

"That's not true," Allen said. "I don't believe what anybody from that company says. It's comical. It's all lies."