Mastro Folds House of Cards

Memorabilia king Bill Mastro was one of the central figures in the book "The Card," the book detailing the mystery surrounding the T206 Honus Wagner, the Mona Lisa of baseball cards. Some believe it was Mastro who cut the card, giving it its funny shape. Can you imagine? At any rate, here's one more added to the unemployment rolls. Perhaps he can get the cell next to Madoff's.

Bill Mastro folds sports memorabilia's largest auction house amid FBI probe
BY Michael O'Keeffe
DAILY NEWS SPORTS WRITER


Mastro auctions chairman Bill Mastro boasted in a Jan. 21 article in the Chicago Daily Herald that his auction house would not be damaged by the recession because it caters to high-end clients.

"When we do our big auctions we're typically dealing with well-heeled guys, and this is what gives them pleasure," Mastro said. "If anything, I think guys are getting more choosy and discriminating about what they buy and how they buy it. But at the end of the day a Mercedes is a Mercedes, and if you want and have the means, you'll pay for it."

Less than two months later, Mastro Auctions is apparently out of business.

Sports memorabilia's largest auction house is at the center of an FBI investigation into shill bidding, card doctoring and other allegations of fraud that have damaged the company's Mercedes image. While Bill Mastro said in the January interview that the company would continue to generate $50 million in annual sales, industry sources say it had crippling credit-line and cash-flow problems. Consignors have complained that they were not paid for items sold at Mastro's December auction.

Three Mastro executives, including president Doug Allen, have purchased Mastro Auction's assets and will launch a new company called Legendary Auctions. The new business has taken possession of computer software and client lists, sources told the Daily News. Allen did not return phone calls for comment, but in a press release, the new company said all outstanding Mastro Auctions business will be "seamlessly facilitated, processed and completed through Legendary Auctions." Industry sources told the Daily News they expect Mastro's consignors will all eventually be paid.

Allen had told potential investors that he is not a target of the FBI probe, according to sources, but the new company appears to be taking steps to avoid shill-bidding allegations and other problems that damaged Mastro's credibility with collectors.

"The principals employed by Legendary Auctions will put their own collecting interests aside and concentrate solely on providing opportunities for our customers," Allen said in the press release. "There will be no mixing of business and pleasure at Legendary Auctions in terms of our own collecting pursuits. This will really be all about our customers."

The Daily News reported last year that sports-memorabilia officials have testified before a grand jury in Chicago that is investigating Mastro Auctions and fraud in the collectibles business.

The grand jury deliberations are part of an investigation into memorabilia fraud initiated last year by the Chicago division of the FBI, whose "Operation Foul Ball" smashed a multistate autograph forgery ring in the 1990s. Other sports-memorabilia businesses and individuals may also be under investigation.

Bill Mastro will not be associated with Legendary Auctions. "Circumstances make it clear to me that the business needs to move in a different direction at this time, and Legendary Auctions is a positive step that allows everyone to be taken care of, especially our customers who have been so loyal," Mastro said in the press release. "I am looking forward to taking some time off for now, and wish Legendary Auctions only the best as they move forward."