Antitrust Law Daily Three real estate investors convicted of bid rigging sentenced to prison time
Thursday, April 27, 2017

Three real estate investors convicted of bid rigging sentenced to prison time

By Jeffrey May, J.D.

The federal district court in San Francisco has sentenced real estate investors Robert Alhashash Rasheed, John Lee Berry III, and Refugio Diaz for conspiring to rig bids at foreclosure auctions held in Northern California. All three were sentenced yesterday to jail time; however, the prison terms were lighter than the durations requested by the Justice Department for individuals who the government contended were "[b]razenly standing on the steps of the county courthouse ... subvert[ing] the competitive process in one auction after another for their own illicit gain" (U.S. v. Rasheed, Case No. 4:14-cr-00582-JD).

The Justice Department announced that Rasheed was sentenced to serve 14 months in prison and to serve 1260 hours of community service, Berry was sentenced to serve 10 months in prison and ordered to serve 974 hours of community service, and Diaz was sentenced to serve eight months in prison and ordered to serve 579 hours of community service. The community service was imposed in lieu of paying a criminal fine, according to the Justice Department.

Tougher sentences. The government had asked the court for tougher sentences. In a court filing, the Justice Department urged the court to order Rasheed to serve 41 months in prison, Diaz to serve 27 months in prison, and Berry to serve 21 months in prison. In addition, restitution was sought against all three defendants, and a criminal fine was requested for Rasheed. The government had argued that its sentences—at either the midpoint or the high end of the applicable ranges—were expressly called for by the Sentencing Guidelines and that these tougher sentences would avoid an unwarranted sentencing disparity for others who were held guilty in the ongoing bid rigging probe.

Ongoing probe. These three defendants are among dozens named in the Justice Department’s investigation of bid rigging and fraud at public real estate foreclosure auctions in California’s San Francisco, San Mateo, Contra Costa and Alameda counties. There have been numerous guilty pleas, and trials are still getting under way in some matters. A trial is scheduled to begin next month in the federal district court in Oakland against Michael Marr and others involving similar allegations.

Convictions stand. The sentencing of Rasheed, Berry, and Diaz follows efforts by these defendants to have their convictions thrown out. In March, the court decided that the defendants were not entitled to an acquittal under Rule 29 of the Federal Rules of Criminal Procedure, or to a new trial under Rule 33. A motion for reconsideration also was denied by the court.

Attorneys: Albert Bilog Sambat for U.S. Department of Justice. John David Forsyth (John David Forsyth, Attorney at Law) for John Lee Berry, III. Steven Francis Gruel (Law Office of Steven F. Gruel) for Robert Alhashash Rasheed. Christopher James D'Anjou (Pagkas & D'Anjou, LLP) for Refugio Diaz.

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