Pop-up auctions deals too good to be true
As CBS News Chicago reports, the retired system analyst is one of a growing number of victims at pop-up auction schemes across the country. The news team discovered that the pop-ups operate under businesses variously called Neoclassic Auctions, US Trustee Auctions, Vanguard Property Auctions and Surplus Auctions — all owned by brothers Azam and Anwar Khan.
These brothers have a history of disciplinary actions around their auction licenses dating back to 1997. They have not had a license to run auctions in Illinois since 2016. Nonetheless, they continue to run the pop-up auctions, with signs boasting that Rolex watches, jewelry and fine art will be up for sale.
Buyers call a number listed on the signs and are given a time and place to attend the auction. Before bidding, they have an hour to examine items and read the catalog which invariably describes items as exceptionally rare and valuable.
Unfortunately, many would-be buyers miss the fine print in the catalog that says the descriptions within it are "statements of opinion only and are not a representation of facts."
Some victims — including Simmons — have taken action. She has approached the media and filed complaints with the Federal Trade Commission.
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Learn MoreHow to avoid an auction scam
Whether you want to participate in an online or in-person auction, it’s important to protect yourself from fraud.
It’s a good idea to:
- Investigate whether auction companies and auctioneers are licensed in your state
- Protect yourself by dealing with well-known, reputable auctioneers like Sotheby’s
- Contact government departments to verify the authenticity of "government" auctions
- Read all the fine print in auction catalogs and listings, including terms and conditions
- Ask about buyer protection policies
- Research the value of items and comparables independently before the auction
- Set a maximum budget before attending an auction
Consider other ways to invest in art or valuables like gold.
It’s also wise to remember the age-old adage that if something sounds too good to be true, it probably is. So you’re unlikely to get a bargain on an authentic Picasso — whether you learn about it on a roadside sign or anywhere else.
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