The U.S. Justice Department said on Friday that a Georgia real estate investor pleaded guilty to charges of fraud in a bid-rigging scheme involving public foreclosure auctions, MorningConsult.com reported. Otto Gogolin admitted that he agreed not to bid against other investors at public real estate foreclosure auctions in a scheme spanning from 2008 to 2011, the Justice Department said in a statement. Gogolin and others suppressed prices at public foreclosure auctions, exchanged payoffs with each other and defrauded the banks in charge of the mortgage notes, DOJ said, citing documents filed in federal district court in northern Georgia. The court documents also allege that Gogolin and his associates secretly re-auctioned properties obtained through bid rigging and pocketed proceeds that would have been used to pay off the mortgages and other debts, or in some cases would have gone to the previous foreclosed homeowners, according to DOJ.
