An Atherton real estate investor pleaded guilty to mail fraud and bid rigging at public auctions of foreclosed properties outside the San Mateo County courthouse in Redwood City, according to the Department of Justice.
Robert Williams’ plea makes him the 31st person to plead guilty or agree to plead guilty as part of the department’s ongoing investigation into fraud and bid rigging at foreclosure auctions throughout Northern California.
Between October 2009 and December 2010, Williams and others conspired not to bid against each other but instead designated a winner to obtain chosen properties, according to court documents.
Doing so kept the winning bid low which in turn, federal prosecutors contend, damaged the real estate market and defrauded those who expected all investors to have a level playing field. Williams was also charged with using the U.S. Postal Service to fraudulently acquire the title to selected properties sold at auction, to make and receive payoffs and to divert co-conspirators’ money.
The collusion thwarted the competitive process and profited at the expense of lenders and distressed homeowners, said Bill Baer, the assistant attorney general in charge of the DOJ’s antitrust division, in a prepared statement.
When property is auctioned, the proceeds pay off the mortgage and debt with any remaining money going to the home owner. Squelching competitive bids limits how much money is available for both.
“The legitimacy of an open, public real estate foreclosure auction is compromised when an individual or group conspires to commit criminal activity which impacts genuine intentions of good citizens,” said FBI Special Agent David J. Johnson in a statement.
Williams faces up to a decade in federal prison and a $1 million fine for violating the antitrust law known as the Sherman Act and up to 30 years and a similar fine for each count of conspiring to commit mail fraud.
Anyone with information about bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at (415) 436-6660 or visit www.justice.gov/atr/contact/newcase.htm or call the FBI tip line at (415) 553-7400.
(650) 344-5200 ext. 102