Attorneys for Bill Mastro are asking a federal judge to keep the former auction house executive from going to jail when sentencing is announced August 20.
Mastro pleaded guilty in October 2013 to shill bidding customers over an eight-year period ending in 2009 and not disclosing information about valuable collectibles his company handled, including the T206 Honus Wagner, graded PSA 8 and a 19th century trophy ball. He also admitted to destroying some auction house bidding records.
In a 72-page sentencing memorandum filed in U.S. District Court Thursday, lead attorney Michael Monico asked Judge Ronald Guzman to consider “a long period of probation with stringent requirements for community service” and possibly home confinement.
Government prosecutors have asked for a 20-month prison sentence while a senior probation officer has recommended a one-year jail term. Both would likely include other conditions. Guzman could also opt for a longer prison term or agree to what Mastro’s attorneys have asked for.
“A prison term would serve only to disrupt Bill’s important good works within the community and waste taxpayer resources, while failing to accomplish any marginal deterrent effect,” Monico wrote in his lengthy memorandum. “We hope the Court will agree that probation is sufficient, but not greater than necessary.
“Bill’s longstanding dedication to charity and personal service, coupled with his evident genuine remorse, confirm that his offense conduct was out of character, that he is extremely unlikely to commit any further crimes.”
Mastro Auctions dissolved during the wake of an FBI investigation in 2009 and Monico stated Mastro would never again be involved in the sports memorabilia industry.
“He cannot and would not go back. His case is now an epic tale within the industry, a lesson to all about the consequences of auction-related misconduct.”
Mastro, 62, lives in the Chicago suburbs. His company was once an industry giant, selling over $300 million worth of valuable cards and memorabilia and producing slick catalogs that generated much attention. His attorneys say Mastro and his staff sold more than 100,000 lots during its time in business.
In 2006, however, the FBI began investigating the company’s business practices and seven years later, government attorneys finally got their guilty plea. Three former associates, including company president Doug Allen, also pleaded guilty in connection with the case. Allen will be sentenced later this year.
Mastro attorneys say shill bidding was the exception, not the norm, promising that only one percent of the lots offered by the company during his tenure as chief operating officer were shilled and that even with those fake bids, some collectors still got their item for less than the ceiling bid.
“Every one of Bill’s customers received an authentic item they wanted, for a price they were willing to pay, with the bulk of the proceeds going to consignors, not the auction house, and with buyers typically experiencing an appreciation in value over time,” Monico wrote. “Again, we do not offer this perspective as an excuse or justification, but as relevant context for the offense conduct: Bill’s misconduct, while wrong, was statistically infrequent, did not characterize his business practice, and did not cause any type of substantial financial harm typical of what this Court has seen in other financial-fraud cases.”
The request for leniency by his attorneys included numerous letters that were solicited from friends, family and associates within the hobby. Those who wrote on Mastro’s behalf included long-time collector and trial attorney Marshall Fogel and autograph authenticator James Spence. The court has also been accepting letters from those who are urging the judge to make Mastro’s penalty severe.
“Despite his transgressions, he helped create a vibrant industry, and helped establish real standards for authentication and grading,” Monico argued. “Many, many people have collections they are proud of, and investments they have profited from, because of Bill.”
Mastro’s lawyers also tried to placate the judge with tales of his abusive childhood, his charitable endeavors in Chicago, his commitment to family and his sponsorship of “religious pilgrimages” at his own expense. They also say Mastro has been genuinely remorseful for his actions and suffers from medical issues including “anxious, depressive, and obsessive symptoms, for which he receives psychiatric treatment and is prescribed multiple medications.”
Mastro has been cooperating with federal investigators looking into other possible crimes in the hobby. His attorneys also hope his status as a first time offender may work in their favor.
“Bill voluntarily left the industry he loved, and will never work in it again. He is a disgraced felon who is experiencing pain and remorse and punishment. The punishment and suffering he has inflicted upon himself, while surely not as severe as imprisonment, is nevertheless real and substantial. And we hope that with punishment also goes mercy for a good man who did bad things, knows he did bad things, and has demonstrated his commitment to making amends.”