John Rogers
John Rogers allegedly was tipped off that federal agents would be visiting his North Little Rock business and home before federal agents executed search warrants on Jan. 28.
In the course of pleading guilty to wire fraud on Monday, Doug Allen, president and CEO of Legendary Auctions in suburban Chicago, admitted warning “Subject A” about an impending raid and that he would be wearing an undercover recording device. The Chicago Tribune reported that Allen’s lawyer, Valarie Hays, had confirmed that Subject A was Rogers.
Hays declined to comment about any of the unnamed parties mentioned in the plea bargain when contacted by Arkansas Business. But Blake Hendrix of Little Rock, an attorney for Rogers, told Arkansas Business that Allen “tried to ensnare” Rogers in Allen’s “own criminal conduct to try to get a lesser sentence.”
“Mr. Rogers is not implicated in Mr. Allen’s obstruction of justice, and Mr. Rogers is glad to have assisted the authorities in exposing Mr. Allen’s crime,” Hendrix said.
No charges have been filed against Rogers, who, according to Allen’s plea agreement with federal prosecutors (PDF) in Chicago, also participated in a “consensually recorded undercover meeting” with Allen.
According to the plea agreement, Subject A was under investigation for false statements related to sports memorabilia. Rogers, the owner of Sports Cards Plus Inc. of North Little Rock, is an investor in Legendary Auctions.
At some point, Subject A began cooperating with the government and conducted recorded undercover meetings with Allen. Excerpts from recordings indicate Allen coached Subject A on how to mislead the FBI.
“Mr. Allen tried to ensnare John Rogers in Mr. Allen’s own criminal conduct to try to get a lesser sentence,” Hendrix said. “We immediately contacted the FBI and agreed to assist its agents in investigating Mr. Allen’s obstruction of justice. Mr. Allen’s plan backfired.”
The charge to which Allen pleaded guilty incorporated several crimes he committed while working for another Chicago-area memorabilia dealer, Mastro Auctions, between 2001 and 2009.
Allen was Mastro’s president and chief operating officer before the business closed in 2009 under the cloud of the FBI investigation that led to his 2012 indictment and the indictments of three other Mastro executives.
Federal prosecutors have taken the position that federal sentencing guidelines call for Allen to serve 10 to 12 years in federal prison, in part because they claim he had more than 250 victims and that they collectively lost between $1 million and $2.5 million.
According to the plea agreement, Allen and his attorneys disagree on the number of victims and believe that the total loss was less than $70,000. Allen also disagrees with the government’s position that he was a leader of a criminal activity rather than merely a manager, and that he should be held accountable for attempting to obstruct justice. By the defense’s calculation, his guideline sentence would be 10 to 16 months.
Allen’s plea agreement included acknowledgment of shill bidding to artificially inflate bidding and detailed three instances of fraud:
- The 2006 sale of a purported 1869 Cincinnati Red Stockings trophy ball for $62,000, even though Allen knew that laboratory testing revealed the ball contained paint manufactured after World War II.
- The sale in 2004 of a T206 Eddie Plank baseball card for $51,518 without disclosing that it has been altered in a way that would lower its market value.
- The sale between 2005 and 2008 of samples of what was purported to be Elvis Presley hair without disclosing that a previous buyer had returned the hair and received a refund after DNA testing revealed that the hair came from four separate individuals.
Allen was originally indicted on 14 counts of mail and wire fraud in July 2012 along with three other Mastro staffers.
Mark Theotikos, former vice president of auction operations and acquisitions at Mastro, pleaded guilty on Aug. 5 to one count of mail fraud. He admitted taking part in the shill bidding scheme that inflated sales prices on sports memorabilia and other collectible items auctioned between 2001 and 2009.
Theotikos, vice president and chief operating officer at Legendary Auctions, was indicted on six counts of mail and wire fraud in July 2012.
Company founder William Mastro, chairman and CEO, was indicted and pleaded guilty to one count of fraud in October 2013 and awaits sentencing.
A fourth Mastro defendant, William Boehm, is scheduled to go to trial on Sept. 8 in U.S. District Court in Chicago. Boehm, former director of information technology at the firm, was indicted on charges of lying to federal investigators.
During its heyday, Mastro was touted as the largest sports memorabilia auction house in the nation. It was at a Mastro auction in 2008 that Rogers bought a rare Honus Wagner baseball card for a reported $1.62 million.
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