Doj Seizes More Than $1 Million Of Collectible Stamps As Proceeds Of Criminal Fraud Scheme

From the DOJ website - https://www.justice.gov/usao-wdwa/p...minal-fraud:

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Scammers overseas used auction house to try to move criminal proceeds offshore

Seattle – The Department of Justice has seized more than $1 million in proceeds from a massive fraud scheme targeting seniors and other vulnerable populations, announced U.S. Attorney Tessa M. Gorman. The U.S. Attorney's Office for the Western District of Washington filed a Verified Civil Forfeiture Complaint seeking forfeiture of 149 lots of collectible stamps and other items seized from the Robert A. Siegel Auction Galleries Inc. of New York. An investigation revealed that the stamps were purchased with monies stolen from victims who were swindled by fraudsters impersonating government agents, regulators, or romantic interests. Once the stamps have been forfeited to the United States, they will be liquidated by the U.S. Marshals Service and the government will seek to return the funds to the victims.

"Too often when victims have been defrauded in these schemes, their money is gone for good," said U.S. Attorney Gorman. "We are delighted to be able to share good news with these victims and hope to be able to return funds to them through this civil forfeiture action."

According to the court filings, the deposits made to the Siegel Galleries and used to purchase the stamps, have been traced to victims of crime. Multiple frauds were used in this case, both government impersonation scams and romance scams. Siegel Galleries is not accused of any crime.

The government has identified 28 victims, from Western Washington and from across the country who were defrauded and mislead. The fraud occurred in two phases. In phase one, victims were called by a person claiming to be from a government entity such as the FBI, SEC, or DOJ reporting that the victim's bank account or personal identity had been breached and stating that the victim needed to send their funds to a different entity for safe keeping. In some instances, victims were told they had been implicated in a money laundering scheme and to prove their innocence and protect their funds they needed to send them to the account designated by the caller. Victims were told their funds would be returned once the matter had been resolved. Some victims were defrauded of hundreds of thousands of dollars.

Some of the victims sent cashier's checks directly to the gallery. Others were instructed to send the money via cashier's check to a second set of victims: romance scam victims. These victims were contacted via social media, and believed they were assisting a romantic interest with money from an inheritance, or an investment or to pay debts. This second set of victims were told to deposit the cashier's checks from the first set of victims and then withdraw the funds and send or wire the money to the gallery.

In all investigators have traced $1,012,300 to the various victims. Funds deposited toward the invoices for purchase of the stamps total $1,383,437. Prosecutors and agents are still working to trace funds to additional victims.

No criminal charges have been filed yet. Potential charges include conspiracy, mail fraud, wire fraud, and money laundering.

The FBI is investigating the case in coordination with Asset Forfeiture Assistant United States Attorney Krista Bush.

That's a lot of money.
Were they using Siegel to launder it?

Shouldn't it have raised red flags that monies were coming in from all these different sources to pay for the fraudster's purchases?

Link doesn't work. Try again: https://www.justice.gov/usao-wdwa/p...iminal-fraud

Here is what I don't get. The fraudsters or their victims paid, but Siegel still had the stamps. Would Siegel have paid the owner(s) if they hadn't even yet sent the stamps out? So why seize the stamps rather than get the money back from Seigel?

I think the forfeiture laws are specifically around seizing *assets* of the alleged criminals tied to the commission of a crime. So a direct link, here the property acquired by proceeds.

As I understand it DOJ would have seized the checks/money if they had not been deposited. Leaving Siegel with the stamps. As the checks had been deposited the DOJ went for the stamps. My father in law ran into a similar situation in 2005, where he sold a property,received a cashiers check cashed it, was then notified by the FBI not to cash the check. When he informed them it was cashed they seized the property.It was auctioned off to recoup the stolen funds.
What is intriguing to me is the handling of the seized assets. I would think that Siegel would be retained to auction the seized assets. Would they then retain an additional buyers/sellers fee? Also the thought that the original winning bids were made with criminal intent,not necessarily philatelic intent.Will a subsequent auction w/o criminal intent realize the same pricing. Another thought; was this the Gross sale? If So, Rinsy you might have another shot,at a discount!
And they say crime doesn't Pay.

Cheers mark
edit for spelling,punctuation

I do hope that the consignors of those stamps get paid.

I guess the implication is that they will get paid, or already did get paid, essentially with the stolen money.

The stamps were the property of the scammers then, I guess, so they were just confiscated.

Just trying to work this out for myself ... what a mess.

It is a valid question or concern, as to how much these bidders inflated prices by for these stamps, and what, if any down stream market effects there might be. I suspect little to none, but with no specific data, who knows.

It's an interesting question whether insurance would pay off for something like this.

How did Siegel let scammers bid more than $1,000,000? Presumably new and unknown bidders. They usually vet their bidders pretty well...at least they vetted me pretty good when I signed up and I only bid on their lowest priced lots.

They just sent out in email celebrating their best month ever, $27 million in sales. Have to wonder when the scam took place, seems like law enforcement investigation would take haven months at least if not longer. But they didn't ship the material which is strange so maybe more recent. Or maybe it was a while ago but they were on to the scam before they shipped.

I suspect the scammers were not well versed in philately. I think everything Siegel sells, especially at that price point, could be uniquely identified and traced without too much trouble. I think it would have been very difficult to re-sell any of that material for more than a tiny of fraction of the sales price because any publicity would have brought attention to the stolen merchandise. Or else maybe the scammers were stamp collectors and planning to keep it all LOL.

So with 149 stamps, that comes to about $9,285 average per stamp.

So they were buying expensive material, as one might have expected.

Cut and pasted from Siegel's Terms and Conditions.

I know I've heard Scott Trepel state this at the start of their sales as well.

So how does this mesh with:




I guess we don't know if Siegel actually accepted those checks or not, in all fairness. All of the details are not public knowledge at this time.

I think that is a relatively new addition to their terms. I remember the announcement at the start of the auction a few months ago and and it sounded like Scott was saying it was a new policy (he didn't explain the reason for why the new policy; now we know the policy was probably in response to this).
Therefore unlikely the Gross sale was involved, this action happened a while ago.
Someone with access to earlier catalogs or archived T&C may be able to pinpoint how recent this policy was created.



I think it said 149 lots, so it could have included some collections or bulk lots.

Yes, good catch on "lots".

The statement "Third-party payments will not be accepted. The payment must come from an account in the name of the buyer." was first inserted into Siegel's Terms and Conditions for Sale 1292 (9/27/2023). Also, I have been told that the 149 seized lots do not contain any U. S. stamps; if so they are not from the recent Gross sale.

Maybe they were from Siegel International sales.