Word: auctioneer
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Most of these auctions are arranged by Southern Star Auctioneers, a Georgia company run by Dion Abadi, who has faced a number of official complaints and fines in recent years in multiple states. At one so-called Madoff auction held this fall in West Palm Beach, Fla. - a community hard hit by Madoff, who once owned houses and other property in nearby Palm Beach and who is now serving a 150-year prison sentence for his massive Ponzi scheme - many potential bidders exited fuming. "They all thought it was Madoff stuff, and it's not; it's from all over...
Abadi did not return numerous phone messages, but his brother Gavin Abadi, an auctioneer also involved in the "Madoff" events, told TIME that Madoff victims do indeed provide merchandise for the auctions and that "we're getting inventory from them every single week." The problem, he said, is that most victims ask to remain anonymous. Southern Star put TIME in touch with one Madoff investor who said he lost millions in the Ponzi scheme and confirmed that he had given the Abadis some artwork to auction. But while that person said he was happy with the price the Abadis...
Gavin Abadi acknowledged that the auction ads "may need tweaking." When told that bidders had complained that no Madoff estate items were on the block, as the ads seem to imply, and that bidders also didn't know whether any items were from Madoff victims, he said, "If that's a major concern, we should look into it and perhaps change some things," including disclosing to potential buyers which items are or aren't from Madoff victims. He said that he and his brother were "not looking to mislead or misrepresent. The victims we've been dealing with...
...auction ads used to reference a much more extensive site, Madoff-Help.com, a news and assistance site for Madoff victims, until its founder, Ron Stein, a certified financial planner in Huntington, N.Y., told Abadi to stop using it in his ads. "I guess he thought it gave them more credibility," says Stein. He says Abadi complied and apologized, but Stein nevertheless felt that "something just seemed unethical" about Southern Star's advertising...
...wouldn't be the first time Abadi has faced such questions. Last year the Florida Board of Auctioneers, which is part of the state's Department of Business and Professional Regulation, sanctioned Abadi twice for violating its rules regarding "false, deceptive, misleading or untruthful advertising." In 2007, Abadi's Illinois auction license was suspended indefinitely for failure to comply with the state's continuing-education requirements. He also had a run-in with Wisconsin regulators in 2002 for "failing to include required information in a published advertisement." Gavin Abadi would not discuss his brother's infractions but said that...