Bloomberg News

California Property Investors to Plead Guilty to Bid-Rigging

October 27, 2011

(Updates with names of investors in fifth paragraph.)

Oct. 27 (Bloomberg) -- Eight Northern California real estate investors agreed to plead guilty to allegations they rigged bids at public foreclosure auctions.

The investors conspired not to bid against each other at auctions in San Francisco County and San Mateo County, the U.S. Justice Department said today in a statement.

“The collusion taking place at these auctions allowed the conspirators to line their pockets with funds that otherwise would have gone to lenders and, at times, financially distressed homeowners,” Sharis Pozen, acting assistant attorney general of the Justice Department’s antitrust division, said in the statement.

To date, 18 people have agreed to plead guilty in the Justice Department’s ongoing investigation of bid-rigging and fraud at public real estate foreclosure auctions in Northern California, according to the statement.

The investors face sentences of as long as 10 years in prison for violating U.S. antitrust law and as long as 30 years for conspiring to commit mail fraud, the Justice Department said.

Charges were filed today in federal court in San Francisco against Gary Anderson of Saratoga, California; Patrick Campion of San Francisco; James Doherty of Hillsborough, California; Keith Goodman of San Francisco; Troy Kent of San Mateo, California; Craig Lipton of San Francisco; Henry Pessah of Burlingame, California; and Laith Salma of San Francisco.

Ted Cassman, a lawyer representing Lipton, and Patrick Robbins, a lawyer for Kent, didn’t immediately return calls for comment. The names of the lawyers for the other defendants weren’t immediately available from the Justice Department.

Anderson, Doherty, Goodman and Pessah didn’t immediately return messages at telephone numbers listed under those names. A person answering the telephone at a number listed for Campion said he no longer worked there and couldn’t provide contact information. A listing for Salma wasn’t available.

--Editor: Stephen Farr, Fred Strasser

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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