Questionable behavior at Orange County Auction?

I have been attending and purchasing foreclosures at auction in orange county california over the last two years. I experienced a situation that seems unethical and I wanted to get your feedback.

The following situations all happened at the same auction with the same auctioneer:

The auctioneer was requested by a regular investor to “auction this property first” as he handed the auctioneer a piece of paper. There was some whispering back and forth with the investor and auctioneer. The auctioneer then auctioned the property and that investor won.

The auctioneer was asked by another individual to “hold this property till the end” as he handed the auctioneer a piece of paper. The auctioneer said, “okay.”

The auctioneer approached an investor and said, “I recognize you from last week, what property are you interested in?” She showed him a piece of paper and he said, “do you want me to auction that now?” She said, “no, hold it to the end.” He said, “okay.”

Additionally, the auctioneer required that everyone that was interested in bidding on properties had to show him their cashiers checks and tell him the total amount they had available. He wrote each persons name down and the total amount of money on a piece of paper.

I have been to many auctions and have never experienced situations like this before. This seems very unethical. Please let me know your thoughts.

As long as the auction was done publicly and during reported time window when the auctioneer was present (i.e. NOT a secret side-auction at an un-annouced time), then I doubt this was a violation of the rules. That said, it is bad form, at a minimum, to be adjusting the order of property sales to suit a particular investor’s (or team’s) needs. Passing notes to the auctioneer is also bad form. It’s a public auction and there should be a level playing field and full disclosure of the process… it just looks bad if whispering (as you described) and note-passing involving the auctioneers is happening.

Re the auctioneer requiring those interested in bidding to show him the beforehand ... this is standard practice. It is called "qualifying to bid." In fact, it would be unethical and sloppy for the auctioneers to NOT verify that bidders have sufficient funds (cashiers checks) before they begin the bidding process. I once lost a bidding war to an investor who did not have sufficient … he’s a well-known player at the steps and a fellow investor came to his aid post sale and endorsed over a cashiers check to make up his shortfall. This happened quickly post sale (as a sidebar solicitation for ) and I could have called foul and made a stink as it was a violation of protocol. This could have been avoided if the auctioneer had properly done his job and re-verified ("show me more ") that the bidder had sufficient once the bidding had crossed over (above) the qualifying amount he had originally noted on his property auction sheet for that particular investor/bidder.

Understood, thank you!

I agree with your views , this is really not ethical .It seems that everything is preplanned.
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