Sioux City Journal: Auction canceled in wake of investigation

Sioux City Journal: Auction canceled in wake of investigation: "Auction canceled in wake of investigation
By Nick Hytrek, Journal staff writer



The Iowa Attorney General's office has launched an investigation into a company that was planning to auction fine art and antique furniture in Sioux City today.

The sale, to be conducted by F.F. Auctions, was canceled Friday.

"We did a little searching, and we recognized that this business has raised concerns in other states," said Bob Brammer, an attorney general spokesman.


Fliers mailed to Siouxland residents advertised a "Spectacular Estate Auction" featuring several antique furnishings, jewelry, fine art by artists such as Rembrandt and Salvador Dali, and electric guitars signed by rock stars.

The flier said the auction items were from a multimillion-dollar private estate. Due to divorce, a renowned art and antique dealer was liquidating the items.

The auction was scheduled for 2 p.m. today at the Council Oak Center in Riverside Park.

The Iowa Attorney General's office was notified of the auction earlier this week after receiving a call from the South Dakota Attorney General's office, which had been notified by a Siouxland resident.

Late Thursday, the Iowa Attorney General's office issued a consumer protection subpoena to Fidelity First Financial LLC, the Dulles, Va.-based parent company of F.F. Auctions. The subpoena asks Fidelity First Financial to produce copies of the identity of the person whose estate is being auctioned, examples of all form documents to be provided to buyers at the auction, all licenses, identities of the people organizing and conducting the auction and all records regarding authenticity of the art listed in the flier.

"We believe that the same principal people are behind companies using different names engaged in similar advertising and auctions," Brammer said.

The auction was canceled shortly after 8 a.m. Friday, said Terry Hoffman, Sioux City parks and recreation manager, who leased the Council Oak Center to F.F. Auctions. The company gave no reason for the cancellation, Hoffman said.

The auction company did not return telephone messages seeking comment.

Hoffman said the company reserved the room by telephone on Sept. 15. Using a credit card, a company representative charged the $900 rental fee. The city will keep a portion of that fee; the rest will be refunded to the auction company. The city incurred no expenses, Hoffman said.

The attorney general's subpoena remains in effect despite the cancellation, Brammer said.

"Our consumer investigation remains pending even though they've canceled the auction," Brammer said.

A similar auction scheduled for Sunday in Sioux Falls also was canceled.

Brammer said the Sioux City auction was similar to one conducted in Des Moines four or five years ago. In that case, several buyers received refunds after they questioned the authenticity of the items they purchased.

Fidelity First Financial has run into legal questions about auctions recently. According to an Aug. 22 article in The Boston Globe, Anwar Khan, Fidelity First's owner, paid a $10,000 fine and agreed to stop advertising the sale of antiques and Oriental rugs after the Massachusetts Attorney General's office accused the company and two others of false advertising.

Nick Hytrek can be reached at 712-293-4226 or nickhytrek@siouxcityjournal.com."