The U.S. Marshals Service are looking into a series of so-called 'Bernie Madoff' auctions in the Northeast, part of a national trend of auctioneers attempting to spark interest in their offerings by dropping Madoff's name.
New Jersey-based Northeast Galleries, Inc. recently held auctions in Rye, New York and Avon, Conn. and raised eyebrows when the auctioneer couldn't identify which items had actually belonged to the disgraced New York financier or victims of his Ponzi scheme. Additional auctions are planned this weekend in Fairfield and Westbrook, Conn.
The man running the sale, Antony Wellesley Briscoe, wouldn't tell a reporter for the Hartford Courant how many items came from the billionaire's estate or how they were acquired. When it came time for the live bidding, the Courant noted that not a single Madoff item was offered in the first hour.
Similar auctions have recently popped up across the Eastern U.S., many of them run by a company out of Atlanta called Southern Star Auctioneers.
The Better Business Bureau has warned prospective bidders of a possible scam, and the attorney general's office of more than one state has taken an interest in the questionable Madoff auctions as well. Connecticut Attorney General Richard Blumenthal announced this week that his office is actively investigating Northeast Galleries.
Now the U.S. Marshals are getting involved. "We're looking into it ourselves," said Supervisory Deputy U.S. Marshal Roland Ubaldo.
"We've only had one auction so far and in that auction, 200 items were from the Bernard Madoff estate," said Ubaldo. "You really have to be cautious about these auctions that are popping up."
He said it's possible, but not likely, that an auctioneer had purchased Madoff items from the Marshals with plans to resell them.
"There's no true way of telling," he said. "We would obviously caution anybody that's purchasing or bidding on any of these so-called Madoff items."
In the cities were its "Madoff" auctions are held, Northeast Galleries takes out advertisements in local newspapers. On the Friday before the Avon sale, they placed an ad on page A11 of the Courant, which read: "One Day Only PUBLIC AUCTION Personal items belonging to Ruth & Bernie Madoff."
According to the Courant, the ad said the sale would include "a huge portfolio of investment grade art" from a person "whose family was victimized by the MADOFF PONZI SCAM."
Connecticut Attorney General Richard Blumenthal is also investigating Northeast Galleries, Inc. Blumenthal's staff is contacting law enforcement agencies across the country, in hopes of gathering additional information on the auction company and any affiliated ventures.
"Much like Madoff's Ponzi scheme," said Blumenthal in a statement, "there's a danger of a scam built on a scam. In the spirit of the Madoff scandal, these auctions appear to blur the truth and dubiously deceive consumers. Auction goers deserve details and proof prior to purchase -- not after it's too late."
Blumenthal addressed his concerns in a letter sent to the auctioneer earlier this week. He asked the company to provide him with documentation proving that items previously advertised or sold were actually owned by Madoff or his victims.