Madison County tax buyers plead guilty to price fixing

Three individuals who participated in Madison County tax sales from 2005-2008 pleaded guilty in U.S. District Court in East St. Louis today to violating the Sherman Antitrust Act.

Barrett R. Rochman, 70, of Makanda,  Scott K. McLean, 51, of Belleville and John A. Vassen, 56, of O’Fallon each pleaded guilty to participating in non-competitive tax sales, according to a release from the U.S. Attorney's office.

In February, former Madison County Treasurer Fred Bathon pleaded guilty on antitrust charges. Bathon was convicted of structuring Madison County property tax sales in a way that increased interest rates for the tax buyers in exchange for campaign contributors.

Sentencing for all three tax buyers has been scheduled for Feb. 21, 2014. Bathon is scheduled for sentencing on Dec. 6.

A violation of the Sherman Antitrust Act is punishable by up to 10 years imprisonment and a $1 million fine.

According to the release issued by the U.S. Attorney's office, in tax sales conducted between 2005 and 2008, Bathon structured them in a way that eliminated competitive bidding and allowed tax buyers to engage in price fixing by only bidding the statutory maximum interest rate of 18 percent.

The tax buyers who pleaded guilty today were charged with making campaign donations to Bathon in exchange for receiving property tax liens at non-competitive interest rates.

The release states that by 2007 and 2008, the bid rigging and price fixing was so pervasive that distressed homeowners were charged the statutory maximum interest rate on nearly every property tax lien sold.

During the tax auction occurring Nov. 14-15, 2007, 2,549 out of 2,574 property tax liens were awarded to bidders for the statutory maximum interest rate of 18 percent, which represented 99.03 percent of the property tax liens auctioned, the release states.

During the tax auction occurring Nov. 13-14, 2008, 2,290 out of 2,364 property tax liens were awarded to bidders for the statutory maximum interest rate of 18 percent, which represented 96.86 percent of the property tax liens auctioned.

The investigation was conducted through the Metro East Public Corruption Task Force by agents from the Internal Revenue Service, and the Federal Bureau of Investigation. The case is being prosecuted by U.S. Attorney Stephen R. Wigginton and Assistant United States Attorney Steven D. Weinhoeft.