Earl P.L. Apfelbaum Inc. is one of seven stamp dealers being sued in a civil action by the attorneys general of three states. The lawsuit charges dealers, who styled themselves as "the Ring," made at least $5 million illegally over some 20 years.
The APS had been criticized for its slowness in taking action against Apfelbaum. However, while the society's bylaws permit a suspension while a member is under criminal indictment, and expulsion for a conviction on felony charges (even those not related to stamp collecting), "we have no similar authority to take action against a member who is subject to a civil suit," said executive director Robert Lamb. "For civil suits, we await the decision of the court. This is part of our tradition of considering a member innocent until proven guilty."
The federal felony charges were filed against Apfelbaum and his firm alone (that is, not the others named in the state suits) in January, some six months after the state suits were announced. He reached a deal with prosecutors in February.
In addition, the American Philatelic Society has suspended the advertising privileges of the Apfelbaum firm in American Philatelist for two years.
The wrongdoing allegedly took place in several states, Britain and France. Apfelbaum pleaded guilty after strike a bargain with Justice Department prosecutors.
"These defendants' collusive practices adversely affected sellers and undermined the marketplace," New York's Elliot Spitzer said in announcing the suit last July.
The other states involved are Maryland and California.
The Apfelbaum firm, of Philadelphia, bills itself as "one of the oldest and largest stamp firms in the world." The other defendants in the case include Anthony Feldman of Britain, identified in the suit as the mastermind behind the scheme; Etienne de Cherisey of France; Davitt Felder and Davitt Felder Inc. of California; Dana Okey of California; Stephen Osborne of Vermont and Britain; and Kees Quirijns of the Netherlands.
"I had respect for some of the accused," said one VSC member. "If they turn out to be guilty I'm going to be mighty disillusioned."
The suit charges the companies kept bid prices low by conducting their own secret auctions before the actual public sales. Only the winner of the secret auction would bid on the stamps at the public auction. The other ring members agreed to withhold bids and were compensated.
In 1996 and 1997, the ring allegedly fixed bids at most of the large stamp auction houses in the United States, including Sotheby's, Christie's, Daniel Kelleher & Co., Harmer-Schau Auction Galleries, Mathew Bennett and Ivy & Mader Philatelic Auctions. According to the suit, nearly $1 billion worth of stamps was sold to collectors and dealers in the United States last year alone. Over $150 million worth of these stamps were sold at public auctions.
"I have acknowledged my participation and I look forward to cooperating with authorities in addressing what unfortunately has been a longstanding practice in the stamp business," Apfelbaum said in a statement.