Real Estate Investor Sentenced to 30 Months in Prison for Rigging Bids at Northern California Public Foreclosure Auctions
WASHINGTON, DC – (RealEstateRama) — A real estate investor was sentenced today for his role in conspiracies to rig bids at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
Michael Marr was charged on Nov. 19, 2014, in an indictment returned by a federal grand jury in the Northern District of California. He was convicted on June 2, 2017, of conspiring to rig bids at foreclosure auctions in Alameda and Contra Costa County. Today, Marr was sentenced to serve 30 months in prison and to serve 3 years of supervised release. In addition to his term of imprisonment, Marr was ordered to pay a criminal fine of $1,397,061.59.
“Michael Marr was a driving force behind a multi-year conspiracy to corrupt the public foreclosure auction process through a system of illegal payoffs,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Today’s sentence reflects the seriousness of that crime.”
The evidence at trial showed that the defendant conspired with others to rig bids to obtain hundreds of properties sold at foreclosure auctions. The conspirators designated the winning bidders to obtain selected properties at the public auctions, and negotiated payoffs among themselves in return for not competing with one another. They subsequently conducted private auctions among themselves at or near the courthouse steps where the public auctions were held, awarding the properties to the conspirators who submitted the highest bids in those private auctions.
As the CEO of Community Fund, LLC and Community Realty Property Management Inc., Marr sent multiple employees to the foreclosure auctions to rig bids on his behalf. As part of the conspiracies, Marr’s agents purchased several hundred properties through the bid-rigging conspiracies and were owed payoffs on hundreds more.
When real estate properties are sold at public auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with the remaining proceeds paid to the homeowner.
The sentence is a result of an ongoing investigation into bid rigging at public real estate foreclosure auctions in California’s San Francisco, San Mateo, Alameda, and Contra Costa counties, which is 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.
