Contra Costa Real Estate Investor Agrees to Plead Guilty to Bid Rigging and Fraud at Public Foreclosure Auctions

March 2, 2014 18:00 pm · 23 comments

A Contra Costa County real estate investor has agreed to plead guilty to his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.

Felony charges were filed this week in the U.S. District Court for the Northern District of California in Oakland against Charles Gonzales, of Alamo. Including Gonzales, a total of 44 individuals have pleaded guilty or agreed to plead guilty as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.

According to court documents, beginning as early as April 2009 until about October 2010, Gonzales conspired with others not to bid against one another and instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in Alameda County. Gonzales was also charged with conspiring to commit mail fraud by fraudulently acquiring title to selected Alameda County properties sold at public auctions and making and receiving payoffs and diverting money to co-conspirators that would have gone to mortgage holders and others by holding second, private auctions open only to members of the conspiracy. The department said that the selected properties were then awarded to the conspirators who submitted the highest bids in the second, private auctions. The private auctions often took place at or near the courthouse steps where the public auctions were held.

“The Antitrust Division’s ongoing investigation has resulted in charges against 44 individuals for their roles in schemes that defraud distressed homeowners and lenders,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division will continue to work with its law enforcement partners to vigorously protect competition at the local level.”

The department said that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at Alameda County public foreclosure auctions at non-competitive prices. When real estate properties are sold at the auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, the conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties and, in some cases, the defaulting homeowner.

“The symbolism of holding illegitimate and fraudulent private auctions near a courthouse is deplorable,” said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office. “The justice system will continue to prevail in this ongoing investigation pursuing bid rigging and fraud at public foreclosure auctions.”

A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victim if either amount is greater than $1 million. A count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The government can also seek to forfeit the proceeds earned from participating in the conspiracy to commit mail fraud.

The charges are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Contra Costa, and Alameda Counties. These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office.

Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-934-5300 or call the FBI tip line at 415-553-7400.

{ 23 comments }

1 Question March 2, 2014 at 6:23 PM

Where can we find the names of the other 44 that have been charged?

I bet there are some local names on there we all might recognize, would be nice to know who among us tried to cheat….

2 Dorothy March 2, 2014 at 6:45 PM

Right on #1.

3 Anon March 2, 2014 at 6:50 PM

Gonzales, solid American(?) name.

4 @anon March 2, 2014 at 7:41 PM

MORON!

5 Another Racist Remark on Claycord March 2, 2014 at 7:54 PM

#3 – Please bring something useful to the conversation.

6 Anonymous March 2, 2014 at 8:52 PM

Dear number 3. Im a regular blue eyed, white guy, but let me point out the Gonzales’ were here before we were.

Another fun fact: A disproportionately high number of Hispanics have been awarded the Medal of Honor.

And I dont care if you are a racist, stupid or just in your cups tonight, so dont bother to answer. I am really tired of dividers.

7 Home From Church March 2, 2014 at 9:38 PM

@ Anonymous—-6

I’m saddened by dividers as well. I pray they have a change of heart and attitude.

Be thankful for those who aren’t discriminatory, which would include you and I.

If we could only do away with fraud. That’s a tough one. I think it’s more widespread than people realize. Greed is a very vicious cycle, and way too profitable for those who engage.

Until they get caught.

8 iluvfriedchicken March 2, 2014 at 11:25 PM

Greed. Greed is good… right?

9 Silva March 3, 2014 at 3:02 AM

Just despicable. I totally agree with #1. Nothing like kicking people when they’re down. It never ceases to surprise the depths some will stoop.

10 Z-Man March 3, 2014 at 4:59 AM

Wonder who dropped the dime on this one.

11 KenInConcord March 3, 2014 at 6:39 AM

Is there a list of the property’s that may have been involved in this?

12 John H. March 3, 2014 at 6:52 AM

@anonymous, actually Gonzales was never a native name to the area. You must have been confused in history class. It was the Spaniards from where the names were derived from. There were only the native Americans and their different flavors spread out through the area.

13 There are lots of Honorable and Reputable Realtors and Investors out there..... March 3, 2014 at 7:55 AM

And then there are the Bottom-Feeding, Peuking Maggots like Charles and his Cronies.

14 Sizanne March 3, 2014 at 8:42 AM

@KenninConcord
All of the records for any of the sales are at the Alameda County courthouse. /a dollar per page.

15 Steve H. March 3, 2014 at 9:01 AM

@John H. #12; are you aware that California belonged to Mexico once apon a time? Of course that was after colonization. Anonomous was refering to that fact.

16 @ John H March 3, 2014 at 10:49 AM

What he said was the Gonzales were here before we were. Spain colonized California, then we stole it from them, fair and square.
You must have skipped that history class.

You could look around and see many Spanish names here if you dont believe that.

17 Chunti March 3, 2014 at 1:02 PM

This guy is a douche, regardless of his race. Shame all the comments are wasted on his last name, not what he did.

18 Sabrina March 3, 2014 at 1:22 PM

@ Chunti—17

Thanks for making me laugh. The first five words anyway. You are correct. Race is irrelevant. It takes the focus off of what he did.

19 anonmtz March 3, 2014 at 2:46 PM

#1…from a January 3, 2014 article in fugitive.com

“Three Contra Costa County real estate investors have agreed to plead guilty to charges that they took part in schemes to rig bids and commit mail fraud at foreclosure auctions for Bay Area homes, the U.S. Department of Justice has announced. Federal felony fraud charges were filed Thursday against Rudolph Silva of Concord, Leslie Gee of Danville and Pleasant Hill real estate investor Thomas Bishop in connection with the alleged conspiracies. Gee faced additional charges for his alleged involvement in similar crimes in Alameda County in 2009, justice department officials said.”

20 Michael Hallock March 6, 2014 at 5:29 PM

This was not limited to 2009 and 2010. I know of a house which was lost to this process in 2013. The jury is deliberating in Federal District Court in Sacramento involving Andrew Katakis of Danville. I definitely would like to remain anonymous.

21 anonymous March 6, 2014 at 6:54 PM

@20 dude, you are doing it so wrong.

22 Pro Fi March 6, 2014 at 7:05 PM

HA HA!!!! Love it!!!! Dirt balls! Yes I too would like the names posted. Ima work on that one!

23 Pro Fi March 6, 2014 at 7:21 PM

Rudolph Silva of Concord,
Leslie Gee of Danville
Thomas Bishop
Thomas Franciose
William Freeborn,
Robert Kramer
Thomas Legault
David Margen
Brian McKinzie
Jaime Wong
Jorge Wong
William Hogarty
James Allen Rivera Jr.
Gregory Wayne Lomba
James Torpey
Anthony B. Joachim
Wesley Barta – The actual indictment: business.cch.com/ald/USvBartaInformation.pdf

SOURCES:
-www.stopfraud.gov › News‎
-http://www.forbes.com/sites/billsinger/2011/07/05/real-estate-bid-rigging-defendants-plead-guilty-in-federal-case/
-http://www.pleasantonweekly.com/news/2013/04/22/financier-and-employees-charged-with-16-counts-stemming-from-real-estate-fraud
-http://www.law360.com/articles/498557/calif-real-estate-investors-cop-to-auction-bid-rigging

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