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Old 08-02-2008, 12:59 PM   #1 (permalink)
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Default FBI at the Nationals

Feds crash National Sports Collectors Convention, hand out subpoenas

Federal investigators crashed the National Sports Collectors Convention in Rosemont, Ill., on Thursday and Friday, delivering subpoenas to several hobby executives to appear before a grand jury that is hearing evidence about fraud in their industry.

Agents from the FBI and United States Postal Service also questioned other dealers and authenticators at the National, the hobby's largest annual memorabilia show.

"This is part of an active federal investigation," said a source familiar with the probe. "I think they came to the National because they knew everybody would be here, all under one roof. It's like shooting ducks in a barrel."

As the Daily News first reported in July 2007, the Chicago division of the FBI, whose "Operation Foul Ball" smashed a multi-state autograph forgery ring during the 1990s, last year initiated an investigation into Illinois-based Mastro Auctions, sports memorabilia's largest auction house.

"The FBI has been walking the convention floor," said American Memorabilia president Victor Moreno. "You can feel the tension."

The visits from federal agents came as Mastro Auctions officials were preparing for the big live auction the company conducts in conjunction with the National.

"No more business as usual," said Chicago collector Michael Gidwitz, who was interviewed by the FBI several months ago. "An unregulated business like this, it brings in a lot of unscrupulous people. This needed to be done a long time ago."

Gidwitz, who became the first person to sell a baseball card for more than $1 million when he sold a T206 Honus Wagner once owned by NHL legend Wayne Gretzky to collector Brian Seigel in 2000 for $1.27 million, said he was victimized several times by one-time friend Bill Mastro, Mastro Auctions chairman. Those allegations first appeared in "The Card," a book about the T206 Wagner by two Daily News reporters that was published last year.

The Gretzky T206 Wagner, known in hobby as "the Holy Grail," was "discovered" by Bill Mastro in the 1980s. It was graded PSA-8 (on a scale off 1-10) by Professional Sports Authenticators, a card-grading service, even though one of the original authenticators acknowledged the company knew the card had been altered, a major violation of vintage card protocol. The book apparently hasn't affected the price: The Wagner was sold to an anonymous collector last year for $2.8 million through SCP Auctions, which owned a minority stake in the card. SCP, however, has never produced evidence that a transaction actually took place.

Mastro and auction house president Doug Allen did not return phone calls for comment. Nor did Randy Mastro, Mastro's brother and attorney who was a deputy mayor under Rudy Giuliani. A Justice Department spokesman in Chicago said he could not confirm or deny an investigation had been initiated.

Hobby executives who have talked to the agents in the past year say the agents have asked about "shill bidding," when an aucton house or a consignor enters fake bids on an item in order to drive up the price.

Investigators have also expressed interest in a North Carolina warm-up shirt sold at the live auction Mastro's company held at the National last year. The shirt was advertised as a Michael Jordan-owned item, even though Memorabilia Evaluation and Research Services, a leading authentication firm, concluded another player's name - Ranzino Smith - had been ripped from the back and repaced with "JORDAN."

The shirt sold for $11,000 and although Mastro Auctions eventually voided the sale, it renewed calls for greater regulation of the dog-eat-dog world of sports memorabilia and attracted attention from the FBI.

Investigators have also questioned Bill Brandt, the president of Development Specialists Inc., the company hired by the state of Ohio to liquidate coins and collectibles purchased with state money by Tom Noe, the Republican Party official convicted in 2006 of stealing from a $50 million workers compensation fund and sentenced to 18 years in prison. Noe had purchased thousands of dollars worth of memorabilia from Mastro, Brandt and Ohio law-enforcement officials have said. Mastro Auctions repurchased the memorabilia back from the state of Ohio in December for $2.5 million.

Leon Luckey of Brockelman and Luckey Auctions said he is believes allegations of wrongdoing have unfairly bruised what he calls "a good hobby." Luckey, who also moderates Network 54, a popular vintage card Web forum, said he hosted a dinner Thursday night for 135 collectors and dealers attending the show.

"We had a great time, laughing and telling stories," Luckey said. "If someone has done something wrong, they should be prosecuted to the fullest extent of the law but it is a shame that it casts a negative light on the hobby. I love baseball and I love cards, but this hobby is all about the people you meet."
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Old 08-02-2008, 01:59 PM   #2 (permalink)
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Isn't it nice to know that the high-end auction houses suck just as much as ebay!
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Old 08-02-2008, 05:45 PM   #3 (permalink)
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Good for them....I hope they go to the clink...Along with JSA and PSA for putting there certificate on there stuff...

I have been hearing from other dealers that the IRS has agents there sneaking around....
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Old 08-02-2008, 06:29 PM   #4 (permalink)
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Good for them....I hope they go to the clink...Along with JSA and PSA for putting there certificate on there stuff...

I have been hearing from other dealers that the IRS has agents there sneaking around....
knowing how both agencies work i'd be more afraid of the IRS than the FBI.
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Old 08-02-2008, 07:03 PM   #5 (permalink)
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Thanks for posting this...it's really interesting...I never knew the stuff about the Wagner card. I'll have to check out the book (is that the thing they are making a movie out of?).
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Old 08-02-2008, 08:16 PM   #6 (permalink)
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Wow, not a good week for our hobby. If the public loses confidence in the validity of high end autographs and other high end items, I would shudder to think of the trickle down.

Thanks for sharing the story. I did not see any of the Fed action yesterday when I was at the National. All I saw was the traffic jam from Haiti when I left the Convention Center.
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Old 08-03-2008, 12:27 AM   #7 (permalink)
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There are so oooooooooo many scumbags in this business its not even funny. F em all. I hope they all walk in front of a moving bus.
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Old 08-03-2008, 08:57 AM   #8 (permalink)
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knowing how both agencies work i'd be more afraid of the IRS than the FBI.
People pay me thousands of dollars to get the IRS off their back. I'd be much more afraid of them as well.

Anyone who thought the FBI just started going back to the national and major shows is dreaming. This time they just showed up and made their presence known.
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Old 08-03-2008, 09:17 AM   #9 (permalink)
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I see Mastro auctions just sold another Wagner the other day too...
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Old 08-03-2008, 12:40 PM   #10 (permalink)
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I see Mastro auctions just sold another Wagner the other day too...
not just another wagner.. THE wagner... the one that is possibly trimmed (referenced in the article). interesting to see how it lost some of its value selling under 2 M this time.
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Old 08-03-2008, 03:33 PM   #11 (permalink)
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It isn't the same Wagner that sold 2 years ago. This was a "New" one to hit the market. I just missed out on the winning bid....1.29 million. Oh well, maybe the next one!
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