A Roseville man is among five people accused of rigging bids at public real estate foreclosure auctions.
A U.S. District Court in Sacramento today unsealed an indictment against four real estate investors and one auctioneer, or "crier," for their alleged participation in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in San Joaquin County.
The indictment, returned by a federal grand jury in Sacramento on Dec. 7, charges W. Theodore Longley, 62, of Roseville; Wiley C. Chandler, 47, of Lodi; Andrew B. Katakis, 47, of Danville; Donald M. Parker, 48, of Valley Springs; and Anthony B. Joachim, 44, of Stockton with conspiring with other unnamed co-conspirators to rig bids and commit mail fraud when purchasing selected properties at the foreclosure auctions. The indictment also charges Longley, the crier, with aiding and abetting the conspirators.
Longley was arrested today at his Roseville home, according to a U.S. Department of Justice news release. Chandler was arrested at his home in Lodi, Katakis was arrested at his place of business in Modesto and Parker surrendered the U.S. Marshal. All four were arraigned today in Sacramento before U.S. Magistrate Judge Kendall J. Newman.
Officials said an arrest warrant has been issued for Joachim.
According to the indictment, Chandler, Katakis, Parker, Joachim and Longley, along with co-conspirators, agreed to suppress and restrain competition by rigging bids to obtain selected properties offered at public auctions in San Joaquin County. They also allegedly devised a scheme to fraudulently acquire title to selected properties sold at the public auctions and to divert money to co-conspirators that would have gone to the beneficiaries.
The indictment alleges that the conspiracy lasted from at least September 2008 until at least October 2009.
According to the court documents, after the conspirators' designated bidder bought the property at a public auction, they held a private auction at which each participating conspirator bid the highest amount above the public auction price that he or she was willing to pay. The conspirator who bid the highest amount at the end of the private auction won the property. The difference between the price at the public auction and that at the second auction was the group's illicit profit, and it was divided among the conspirators in payoffs.
To date, officials said, eight individuals have pleaded guilty in U.S. District Court for the Eastern District of California in connection with the investigation: Anthony B. Ghio, John R. Vanzetti, Theodore B. Hutz, Richard W. Northcutt, Yama Marifat, Gregory L. Jackson, Walter Daniel Olmstead and Robert Rose. In addition to those who have pleaded guilty, Kenneth A. Swanger was charged Nov. 22 with participating in bid-rigging conspiracies at public real estate foreclosure auctions.
The charges arose from an ongoing federal antitrust investigation of fraud and bidding irregularities in certain real estate auctions in San Joaquin County, according to the news release. The investigation is being conducted by the Department of Justice's Antitrust Division's San Francisco Office, the U.S. Attorney's Office for the Eastern District of California, the FBI's Sacramento Division and the San Joaquin County District Attorney's office.