From the U.S. Department of Justice
- A Georgia real estate investor pleaded guilty  for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Georgia, the Department of Justice announced.
Felony charges against David Wedean were filed on April 27, 2015, in the U.S. District Court of the Northern District of Georgia in Atlanta. According to court documents, from at least as early March 2007 and continuing at least until August 2011, in Fulton County, Georgia, and from at least as early as August 2007 and continuing at least until September 2011, in DeKalb County, Georgia, Wedean conspired with others not to bid against one another, but instead designated a winning bidder to obtain selected properties at public real estate foreclosure auctions in Fulton and DeKalb Counties.
Wedean was also charged with a conspiracy to use the mail to carry out a scheme to fraudulently acquire title to selected Fulton and DeKalb properties sold at public auctions, to make and receive payoffs and to divert 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 defendant conspired with other real estate investors to profit by defrauding mortgage holders and property owners,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “This case, which is the eighth prosecution so far against defendants for rigging public foreclosure auctions in Georgia, demonstrates the Division’s continuing commitment to rooting out corruption and fraud in real estate markets around the country.”
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 Fulton and DeKalb County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these 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, these 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.
Including Wedean, eight cases have been filed as a result of the ongoing investigation being conducted by Antitrust Division’s Washington Criminal II Section, the FBI’s Atlanta Division and the U.S. Attorney’s Office of the Northern District of Georgia. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions in Georgia should contact Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or visit www.justice.gov/atr/contact/newcase.htm.