Suburban Auction House Accused Of Defrauding Bidders
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CHICAGO (CBS) — The head of a now defunct sports auction house has been indicted, along with two other executives, for scamming customers into buying high-priced items that weren’t authentic, or otherwise less valuable than advertised.
WBBM Newsradio’s John Cody reports the former Mastro Auctions, which billed itself as the world’s leading sports and Americana auction house, is accused of selling a lock of hair that they falsely claimed was Elvis Presley’s, and of failing to disclose that a rare Honus Wagner baseball card had been damaged.
The Burr Ridge-based auction house closed down in 2009, amid the federal probe into its activities.
The indictment announced Wednesday alleges Mastro Auctions’ former owner William Mastro, and former executives Doug Allen and Mark Theotikos routinely rigged auctions through deceptive practices to drive up prices of items up for bid.
LISTEN: WBBM Newsradio’s John Cody reports
For example, FBI Special Agent Joan Hyde said DNA reports refuting the authenticity of a lock of Elvis Presley’s hair we’re not passed on to bidders
“One of the defendants, Mr. Allen, sold portions of that hair, again representing it as coming from the head of Elvis Presley, knowing that this DNA testing had proven otherwise,” Hyde said.
The indictment also charges Mastro failed to tell bidders on a 1909 Honus Wagner T-206 baseball card once owned by hockey Hall of Famer Wayne Gretzky that the edges had been trimmed, which would have improved its appearance, but significantly reduced its value.
The defendants are also accused of using “shill bidding” to drive up prices, by having others bid on an item solely to drive up the price, to the detriment of legitimate buyers.
“That person has been harmed by having to bid against somebody who has no intention of completing the sale,” Hyde said.
Mastro, 59, of Palos Park, who owned Mastro Auctions until 2004, and served as chairman and CEO until 2009, has been charged with one count of mail fraud.
Allen, 49, of Crete, was president and chief operating officer from 2001 to 209. He was charged with 14 counts of wire and mail fraud.
Theotikos, 51, of Addison, was an executive at Mastro from 1996 to 2009. He was charged with six counts of wire and mail fraud.
Federal prosecutors said both Allen and Theotikos are now executives at Legendary Auctions, based in south suburban Lansing.