Two consumers had one of two lots and the rest was sold at a price which is a little higher than the competitive and original price. Just like the first auction, participants did not want to have too much contact with others and had very mysterious faces. However, before the auction, all the participants were having some kind of discussion with court officials. You got the impression that the officials were explaining something to them, encouraging them. The only difference between the two auctions was that no jewelry was sold during the second auction, but real estate did get sold. Let’s recall that during the first auction, jewelry was pretty cheap and only one buyer bought it. It appears that all the jewelry had been confiscated, collected and presented during an auction and the consumer had bought it knowing beforehand. This time, the real estate auction was in the center of attention. For example, the original price of the home located on 25 Arabkir, 2nd floor with one bedroom was 5,845,000 drams. One buyer had called out an amount and bought it immediately. The price of that home increased until it reached 5,900,000 drams, basically, it was sold for $13,400 dollars. Arabkir is considered to be the second “most expensive” community after the Central community. In the Arabkir community, the average price for a one bedroom home in good conditions (the home was described this way) is 20,000 USD, if not more. It was immediately clear that the buyer knew about the price beforehand, especially since the auctioneer was trying to find the buyer while presenting the lots. Before presenting himself, the buyer would raise his amount and the auctioneer would look in that direction. There were some “extreme situations” during this auction: there were mistakes made in two of the buyers’ documents which could have been a reason for not participating in the auction. Somebody’s application had not even been registered, but the auctioneer did not care about that and continued the auction. If the auctioneer found out that the buyer had come to the auction by chance, then that would be a reason to expel him.
The person who we interviewed has participated in the auctions organized by the court officials a couple of times for buying a car; however, he has not been able to buy his desired product.
“I happened to be reading the “Classified” section and saw that a “GAZ 31-10” brand name car was being put up for auction. I applied to buy that car, but at the last minute I found out that the car had been taken out of the auction. They told us that the debtor had paid off his loan and they took it out of the auction. Twenty one days later, during the next auction, I saw that the same car had been put up for auction again. I wanted to apply again, but this time they told me that it was a typographical error and that the car will not be auctioned. I decided to participate again, but this time there were two applications and they were my two girlfriends. During this auction, a third person came and increased the price. We suppose that the person who wins the auction will buy the car. However, I started to doubt the legality of the auction and bought another booklet. The car had been put up for auction again, but nobody had bought it. As for winning and buying, the applicant had to lose 5% of the prepaid lot amount. But we didn’t know if the third person had paid the 5% amount beforehand or not, especially when they weren’t even hiding the fact that the person was one of their workers. They were telling us to not participate at all, that we couldn’t purchase that car. We participated; this time there was another participant from their side. The price increased so much that it passed the market price. We lost and we received that prepaid amount with great difficulty.”
Court officials explained that their co-worker had to have a shady cooperation with the buyer. Hmayak Navasartyan, owner of the auction, was trying to convince us that the court official has “minimal” participation during the auction. According to head of auction coordination and real estate sale, auctioneer Yenok Andreasyan, the “guilty” one in that case was the loaner.
“That is impossible,” says Yenok Andreasyan. “It is possible for the loaner to participate in the auction and not let his house or car be sold. True, he loses his prepaid amount, but later he has the chance to get his car back. I must tell you that the loaner for us is not an ordinary applicant. Of course, if we see any amount of money we will confiscate it from him and he will not be able to pay the prepaid amount. But if there is someone who is with him, then we can’t do anything about that.”
As a rule, the price of lots (products) presented at the auction is usually very low. The price is decided by the so-called independent specialist of the court officials who has signed a contract. As for the court officials, it turns out that they have no right to question the price set by the specialist.
“That is a big loop in our business,” says Hmayak Navasartyan. “The government is currently trying to find ways of getting more specialists through a contest which will be decided by the end of the year. In that case, both sides will have the right to configure the price set by the specialist. This way, the shady work done by the court official will be terminated.”
Mr. Navasartyan brought up an example for the “news”. The court official gets the right to find a buyer and sell the lot directly, meaning that the court official becomes the seller. Mr. Navasartyan makes a point here in that the court official’s shady work is shortened, better yet; there is a chance that his shady, illegal work will become legal.
In any case, almost everyone is of the opinion that the owner of the cheap product or the expensive home is either a friend/relative of the court official, or the buyer simply pays a price approximate to the market price. People also think that the extra money will be paid by the court official.