CR-MAR MATTHEW MAN

Transcription

1 ' Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 1 of 14.., F.luun w sa n.c. Nov 2, SOUTHERN UNITED STATES DISTRICT DISTRICT OF FLORIDA CO UR T STEVEN CLERK U M b A DIsT. IMORE ct. j s.d. OF /ta -w.f CR-MAR MATTHEW MAN UNITED STATES OF AMERICA, CRIMINAL INDICTMENT è v. Crim inal No.: (1) AVI STERN; (21 STUART HANKm; and Violation: 15 U.S.C. 91.; (31 CHM STOPHER GRAEVE; Defendants. THE GRAND 'URY CHARGES: ' q ;! BACKGROUND! ' ( 1. n e U nited States experienced a severe financial crisis and recession Y ginning in One of the industries M t hardest by the recession w as the housing industry. In the years aher the recession began, m illions of people became delinquent on their mortgage paynwnts, and financial instimtions were forced to foreclose on m ilions of their hom es, including in the Southern Diskict of Florida. 2. In the State of Florida, foreclosure proceedings are required to be adjudicated '. q through the Florida state courts. The result of these judicial foreclosure proceedings is ohen a Final Judp nent in favor of the foreclosing Gnancial institution for the total am ount of delinquent m ortgage paym ents and any costs or fees related to the property. Once the Court enters a Final Judgment against the homeowner, the home is scheduled for auction. E ( li 3. During a legitim ate, com pd itive foreclosure auction, participants interested in the. property compete against each other. lf the bidding exceeds a reserve am ount set by the ' foreclosing financial instimtion, the highest bidder wins title to the promrty. For foreclosme ( y i l auctions conducted in Palm Beach County, the proceeds from the auction are paid to the Palm E è ' 1. '

2 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 2 of 14 Beach County Clerk's office. Under Florida law, the County is entitled to fees related to adm inistering the foreclosure auction. The Clerk's office deducts its fees and pays the remainder to the foreclosing financial institution, up to the Final Judgm ent am ount. Subordinate lienholders can then file a claim to any sum lus. A fter paym ent of the stlrplus to secondary lierlholders (if anyl, the remaining funds are available to the homeowner. 4. In Palm Beach County, prior to January 21, 2010, foreclosure auctions w ere conducted by the Palm B each County C lerk's office in-person at the Palm Beach County Courthouse. Beginning on January 21, 2010, the foreclosure auction process was changed from an in-person process to an online process. Each year since 2010, thousands of foreclosed properties in Palm Beach County have been auctioned through the online auction. DEFENDANTS AND CO-CONSPIRATORS 5. A t certain or a1l tim es during the Conspiracy Period, beginning in or around January and continuing into or around June 20 15, Defendant Avi Stern (t%stern') was associated with Com pany A, a Florida corporation. A t certain tim es during the Conspiracy Period, Stel'n participated, either directly or through his agents, in the Palm B each County online property foreclosure auction process. 6. A t certain or a l tim es during the Conspiracy Period, D efendant Stuart H ankin ($Har1kin') was an officer of Company B, a Florida corporation. At certain times during the Conspiracy Period, H ankin participated, either directly or through his agents, in the Palm Beach County online property foreclostlre auction process. At certain or a l tim es during the Conspiracy Period, Defendant Christopher Graeve (CtGraeve') was an oficer of Company B. At certain times during the Conspiracy

3 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 3 of 14 Period, Defendant Graeve pm icipated, either directly or through his agents, in the Palm Beach Cotmty online property foreclosure auction process. 8. Various corporations and individuals, not m ade defendants in this lndictment, participated as co-conspirators in the offense charged herein and perfonned acts and m ade statem ents in furtherance thereof. 9. W henever in this lndictm ent reference is m ade to any act, deed or transaction of any corporation, the allegation m eans that the corporation engaged in the act, deed, or transaction by or thzough its officers, directors, agents, em ployees, or other representatives while they were actively engaged in the managem ent, direction, control, or transaction of its business or affairs. COUNT ONE - CONSPIM CY TO RESTRM N TRADE (15 U.S.C. j 1) (Stern, Hankin, and Graeve) 10. Each and every allegation contained in Paragraphs 1 through 9 of this Indictm ent is hereby re-alleged as if fu ly set forth in this Cotmt. THE COMBINATION AND CONSPIM CY 11. D uring the Conspiracy Period, beginning in or around January 2012 and continuing into or around June 2015, the exact dates being llnknown to the Grand Jury, in Palm Beach County, in the Southenz District of Florida, and elsewhere, Defendants, and others known and unknown to the Grand Jury, entered into and engaged in a combination and conspiracy to suppress and elim inate competition by rigging bids and allocating the m arket for properties sold during online property foreclosure auctions in Palm Beach County, Florida, in unreasonable restraint of interstate trade and comm erce in violation of Section 1 of the Sherm an Antitrust Act, 15 U.S.C. j 1. 3

4 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 4 of The charged combination and conspiracy consisted of a continuing agreem ent, understanding, and concert of action among Defendants, and between Defendants and their coconspirators, the substantial tenns of w hich w ere to rig bids and allocate the m arket for properties sold during online property foreclosure auctions in Palm Beach County, Florida. MEANS AND METHODS OF THE CONSPIM CY TO RESTM IN TRADE For the purpose of forming and carrying out the charged com bination and conspiracy, Defendants and their co-conspirators com bined and conspired to, am ong other things: a. Attend m eetings and engage in discussions by telephone, electronic m ail, and text m essage regarding the m arket for properties sold during online property foreclosure auctions in Palm Beach County, Florida', b. A gree during those m eetings and discussions w hich conspirator would be perm itled to win a particular property or properties presented for auction', Agree during those m eetings and discussions not to com pete, or to stop com peting, against each other; d. A gree during those m eetings and discussions to lower existing bids in order to a locate properties am ong each other; A gree during those m eetings and discussions to avoid com peting w ith each other in certain geographic territories or neighborhoods', Subm it bids or refrain from bidding during the online auctions consistent w ith the agreem ents m ade betw een D efendants and their co-conspirators; g. Purchase selected properties at public foreclostlre auctions at prices they artiticialy suppressed; and 4

5 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 5 of 14 h. Conceal the existence of Defendants' conspiracy from: financial institutions', secondary lienholders; defaulting hom eow ners; em ployees of the Palm B each County C lerk's O ffice; and others w ho relied on the integrity and com petitive purpose of the auction process. TRADE AND COMMERCE 14. Dtzring the tim e period covered by this lndictment, the business activities and online property foreclosure auctions on which Defendants and their co-conspirators conspired occurred w ithin the continuous and unintem zpted tlow of, and substantia ly affected, interstate com m erce. For exam ple: a. A substantial num ber of the foreclosing financial institutions w ere located outside the state of Florida', Out-of-state foreclosing financial institutions sent instructions regarding the foreclosures to 1aw firm s located in Florida; Substantial proceeds, paym ents, and doctzm entation from and relating to the sale of properties purchased by the D efendants ptlrsuant to the conspiracy were transmited from one state to beneficiaries located in other states; Bidders for and purchasers of properties sold at the Palm Beach County foreclosure auction w ere located outside the state of Florida; 5

6 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 6 of 14 Bids were subm itled via the internet on an auction platform nm on servers located outside the state of Florida; and A large num ber of the foreclosing tinancial institutions operated in interstate comm erce and were federally insured, federaly charted, and/or subject to federal regulation. JURISDICTION AND VENUE 15. The combination and conspiracy in this Count was form ed and carried out, in part, w ithin the Southem D istrict of Florida within the tive years preceding the return of this Indictm ent. ALL IN VIOLATION OF TITLE 15, UNITED STATES CODE, SECTION 1. gremainder of page intentionaly left blankl 6

7 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 7 of 14 A TRUE BILL M akan elrahim A ssistant A ttorney G eneral A ntitrust D ivision U nited States Departm ent of Justice FOREPERSON. N. v g Lisa. Phelan Chief, W ashington Crim inal I Section A ntitrust D ivision U nited States D epartm ent of Justice ' ṃ. < & Marvin N. Price A cting D eputy A ssistant A ttorney G eneral A ntitnzst Division United States D epartm ent of Justice M lchelle 0. ltindone Acting D irector of Crim inal Enforcem ent A ntitnzst D ivision U nited States D epartm ent of Justice V c Pa T. Ga lagher damson Asiyanbi Jam es w. Attridge Yusong H uang Trial Attorneys, Antitnzst D ivision U nited States D epartm ent of Justice 4505th Street 5N.W., Suite W ashington, DC Te1: (202) Fax: (202) Paul.Galagherz@usdoj.gov 7

8 Case 9:17-cr KAM Document UNITED 1 STATES Entered DISTRICT on FLSD COURT Docket 11/02/2017 Page 8 of 14 SOUTHERN DISTRICT OF FLORIDA UNITED STATES OF AMERICA CASE NO. VS. CERTIFICATE OF TRIAL ATTORNEY* A V l S T E ltn a. STUART HANKIN, and CHRISTOPHER GRAEVE, Defendants. / Superseding C ase Inform ation: Court Division'. (select One) Miami Key West FTL W PB X FTP l do hereby certify that: New Defendantts) N um ber of New Defendants Total number of counts I have carefully considered the allegations of the indictm ent, the number of defendants, the num ber of probable witnesses and the legal complexities of the lndictm ent/lnformation attached hereto. l am aware that the information supplied on this statem ent w il be relied upon by the Judges of this Court in setting their calendars and scheduling criminal trials under the m andate of the Speedy Trial Act, Title 28 U.S.C. Section lnterpreter: (Yes or No) No List language and/or dialect ng 1sh This case wil take 6-10 days for the parties to tl'y. Please check appropriate category and type of offense listed below: (Check only one) l 0 to 5 days 11 6 to 10 days IIl 11 to 20 days IV 21 to 60 days V 61 days and over 6. Has this case been previously filed in this District Court? (Yes or No) No lf yes: Judge: Case No. (Attach copy of dispositive order) Has a complaint been filed in this mater? (Yes or No) No lf yes: M agistrate Case N o. n/a Related M iscelaneous num bers: Defendantts) in federal custody as of n/a Defendantts) in state custody as of Rule 20 from the District of Is this a potential death penalty case? (Yes or No) Yes X Petty M inor Misdem. Felony Does this case oliginate from a matter pending in the N orthern Region of the U.S. A ttorney's Office prior to October l4, Yes X No Does this case originate from a matter pending in the Central Region of the U.S. Attorney's Office prior to Septem ber 1, 2007? Yes X No z.x 2 H r ' AUL GALLAGHER TRIAL ATTORNEY, U.S. Dept. of Justice, Antitnlst Division D.C. Bar N o *penalty Sheets) atached

9 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 9 of 14 Defendant's Name: AVI STERN Case No: Count : 1 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA 15 USC 5 1 Conspiracy to Restrain Trade PENALTY SHEET * M ax. Penalty: m axim um 10 years' im plisonm ent; up to 3 years' supervised release', maxim um $1,000,000 fine; *Refers only to possible term of incarceration, does not include possible fines, restitution, special assessm ents, parole term s, or fodeitures that m ay be applicable.

10 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 10 of 14 Defendant's Name: STUART HANKIN Case No: Count : 1 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA 15 USC 5 1 Conspiracy to Restrain Trade PEN ALTY SHEET * M ax. Penalty: m axim um 10 years' im prisonm ent; up to 3 years' supervised release; maxim um $1,000,000 fine; *Refers only to possible term of incarceration, does not include possible fines, restitution, special assessm ents, parole term s, or fodeitures that m ay be applicable.

11 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 11 of 14 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA PENALTY SHEET Defendant's Name: CHRISTOPHER GM EVE Case N o: Count : 1 15 USC 5 1 Conspiracv to Restrain Trade * M ax. Penalty: m axim um 10 years' im prisonm ent; up to 3 years' supervised release', m aximum $1,000,000 tine; erefers only to possible term of incarceration, does not include possible fines, restitution, special assessm ents, parole term p, pr fprfvitprep that m ay be applicable.

12 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 12 of 14 UM TED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NUMBER: BOND RECOMMENDATION DEFENDANT: AVI STERN Non-surety Bond (Personal Surety) (Comorate Surety) (Cash) (Pre-Trial Detention) v( * : B y: A A: PAUL GALLAGHER Last K now n A ddress: at Facility: Agentts): (FBl) (SECRET SERVICE) (DEA) (lrs) (1CE) (OTHER)

13 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 13 of 14 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NUM BER: BOND RECOM M ENDATION DEFENDANT: STUART HANKIN Non-surety Bond (Personal Surety) (Corporate Surety) (Cash) (Pre--frial Detention) By:. u' 5 r.' SA: PAUL GALLAGHER Last Know n A ddress: W hat Facility: Agentts): (FBl) (SECRET SERVICE) (DEA) (IRS) (ICE) (OTHER)

14 Case 9:17-cr KAM Document 1 Entered on FLSD Docket 11/02/2017 Page 14 of 14 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NUM BER: BOND RECOM M ENDATION DEFENDANT:CHRISTOPHER GRAEVE Non-surety Bond (Personal Surety) (Corporate Surety) (Cash) (Pre-Trial Detention) >,. ' p a. By: - A: PAUL GALLAGHER Last Known Address: W hat Facility: Agentts): (FBl) (SECRET SERVICE) (DEA) (lrs) (lce) (OTHER)