Mastro Being Investigated - Article

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Posted By: T206Collector

chicagotribune.com

Burr Ridge auctioneers subpoenaed in sports memorabilia fraud probe, sources say
Authorities said to be investigating possible 'shill bidding' to drive up prices on collectibles
By Jeff Coen

Chicago Tribune reporter

11:40 PM CDT, August 4, 2008

There's a lot of money to be made in the sports memorabilia business, as shown by an auction in Chicago late last week in which a single baseball card sold for $1.62 million.

But it's not just collectors who have taken an interest in the buying and selling—federal agents in Chicago are looking into allegations of fraud, sources say.

The sources confirmed Monday that investigators handed out subpoenas to executives of Mastro Auctions at last week's National Sports Collectors Convention in Rosemont.

Authorities are said to be investigating possible "shill bidding" in which bogus bids are submitted to drive up the prices of collectibles.

Mastro Auctions, headquartered in suburban Burr Ridge, handled the $1.62 million auction of a rare 1909 Honus Wagner baseball card Friday evening in Chicago. There was no indication that the card's sale is of interest to investigators.

Spokesmen for both the FBI and the U.S. attorney's office in Chicago declined to comment on the existence of any probe.

Mastro Auctions, one of the biggest auction houses in the sports memorabilia business, did not return a call Monday seeking comment on the subpoenas.

Mastro is led by president Doug Allen and reported revenues of $45 million in 2006. On the company's Web site, Mastro bills itself as a premier choice for those seeking to sell memorabilia at auction.

"The level of ethics, credibility and service you'll receive from Mastro Auctions is second to none in the industry," the Web site says.

The National Sports Collectors Convention, billed as the largest in the country in the sports memorabilia hobby field, was held Thursday and Friday.

As part of the convention, Mastro auctioned off the Wagner card at the downtown Chicago ESPN Zone and sold the 600th home run ball hit by Ken Griffey Jr., who was traded to the White Sox last week.

The FBI exposed fraud in the sports memorabilia industry a decade ago. The nationwide probe, code-named "Operation Foul Ball" and centered in Chicago, resulted in the convictions of more than a dozen people in large part because of the undercover work of a former dealer.

That investigation revealed forgeries of sports stars' autographs on thousands of jerseys, other sportswear and equipment. Distributors were convicted of selling millions of dollars in phony collectibles, including basketballs and jerseys purportedly signed by Bulls great Michael Jordan.

At the time, authorities said the industry itself estimated that forgeries made up as much as 70 percent of the sports memorabilia market.



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