Editor's note: An earlier version of this story contained an inaccuracy based on incorrect information provided to the Times. Real estate investor Bassem Dibbs was not acting as a bidding agent for Nabil Ghanimeh, a tax-delinquent property owner, at the county's tax sale auction, nor was he banned from bidding, according to Lake County Auditor attorney Randy Wyllie.
CROWN POINT — The Lake County Auditor's office allegedly ignored the city of East Chicago's warnings years ago of illegal bidding at the county’s tax sale auctions, records obtained by The Times show.
In a Sept. 16, 2011, letter, East Chicago attorney Carla Morgan requested that the county ban dozens of real estate investors and limited liability corporations with building code violations or tax delinquencies from bidding in the upcoming tax sale events.
Under state law, people who are delinquent on county property taxes are not allowed to bid on other tax-delinquent properties being sold at county tax sales. Property owners faced with local building code violations are also subject to a ban.
“This prevents property from coming into the hands of persons who have a history of unresolved code violations and provides the city with a means to resolve code violations ... ” Morgan wrote in the 2011 letter.
Records show Morgan and East Chicago Building Commissioner Winna Guzman sent similar letters in August and March 2012, warning county leaders about Thomas Wisniewski, a Region real estate investor who is serially delinquent on his taxes.
The letters lists Wisniewski, several associated LLCs and other potential bidders purportedly known to be ineligible.
Based on follow-up letters sent in March and August 2012, it appears the county ignored Morgan's requests.
Ultimately, Wisniewski continued bidding in public tax sales and is believed to have directed the bidding on hundreds of Gary properties in the 2019 tax sales on behalf of another LLC at the center of a controversial land grab.
Right now, the county is weighing the possible nullification of those 2019 bids because of Wisniewski's personal property-tax delinquencies, which county records show total $207,878.83.
But East Chicago's 2011 and 2012 warning letters show county officials should have known of the potential problems before Wisniewski was allowed to bid in the first place.
In those letters, the city of East Chicago noted having researched and identified multiple ineligible buyers allowed by the county to bid in subsequent tax sales.
The letter is addressed to Treasurer John Petalas, though the auditor's office oversees the treasurer's and commissioner's tax sales and is responsible for weeding out ineligible bidders.
John Dull, attorney for the Lake County Commissioner's office, told The Times the auditor's office routinely allows proxy bidders to participate in auctions. Dull confirmed he was sent a copy of the 2011 and 2012 letters.
He told The Times he gave the March 2012 letter to the auditor's office and announced at the auction the list of people who could not bid.
"I know that they got (the letter)," Dull said. "Not to point fingers at any one person, but the auditor's office is responsible."
'Straw man purchases'
Wisniewski now finds himself at the center of controversy after a Times investigation uncovered him directing hundreds of bids on behalf of Broadway Logistics Complex LLC, even though state law should make him ineligible to have participated.
Several sources with knowledge of the county’s tax sale operations and the local real estate market accuse Wisniewski of gaming the system for years and avoiding taxes by bidding at the tax sales each year under newly created limited liability corporations. Interviews with sources and records obtained by The Times shows Wisniewski has direct or indirect ties with several LLCs that routinely bid at tax sales.
This year, the auditor's office is challenging hundreds of successful bids tied to Wisniewski and a politically connected attorney in Gary, Rinzer Williams III, only after a Times investigation brought to light the scandal.
The city of East Chicago advised the county in their letters that the Unsafe Building Law also prohibits straw man purchases — "purchases made on behalf of prohibited party by an attorney or other representative to later convey the property to a barred party."
The city of East Chicago requested the county bar their list of individuals “until such time as these entities pay delinquencies and come into compliance with properties under their control.”
The city also requested the auditor’s office use its authority to forfeit the sale of any properties tied to such individuals and that any surplus from the forfeited properties be applied to the individuals’ delinquent taxes, special assessments, penalties and interest.
Indiana law governing tax sales also applies to co-owners, officers, majority stockholders, those with a contractual interest in a subject property and agents and managers of the above. And it bars such people from participation in subsequent tax sales.
At the time, Wisniewski or associated LLCs were in violation of East Chicago's unsafe building codes, according to the city.
The city said building staff was moving forward with demolitions of some of Wisniewski's properties and deemed others unfit for human habitation.
Matt Fech, attorney for the Lake County commissioners, said Wednesday that a search of county records found the auditor's office did not ban Wisniewski in 2011. The county found no record of Wisniewski, his wife or any LLCs associated with him as registered bidders in 2012.
"Now whether they disguised themselves under other LLCs, we don't know. There are so many layers to this," Fech said.
East Chicago's 2012 letters note at least one LLC in which Wisniewski was a registered agent at the time — Benchmark Enterprises. The city's records note Benchmark was allowed to bid in 2012.
'Chasing these guys for years'
The city copied County Auditor attorney Randy Wyllie; County Commissioner attorney John Dull; and SRI Incorporated, the Indianapolis-based firm that operates the treasurer's online tax sale, in the 2011 letter.
When reached for comment, Wyllie said he has "no independent recollection" of receiving the city's letter.
"But if I was (carbon copied), I can only assumed I received it," Wyllie added.
Wyllie said there may not have been enough time for the county to investigate the city's claims ahead of the tax sale.
Asked why the county didn't challenge those bids after the tax sales, as the city of East Chicago requested, Wyllie reiterated that he had "no independent recollection" of receiving the city's letter.
Wyllie said he has a record for barring tax-delinquent purchasers from the tax sale when information is brought to him.
"I've been chasing these guys for years," he added. "And I do everything in my power to stop them."
Wyllie said Gina Scheidt, supervisor in the tax sale office, informed him this week that if she received any such letter, they would have been promptly forwarded to him.
Emails obtained by The Times show Wyllie promptly obliged other cities' requests to bar individuals.
He barred Nabil Ghanimeh, a Hammond property owner with a history of losing properties for failure to pay taxes, one day after Hammond attorney Kris Kantar sent a request in July 2018.
Wisniewski, whose 2019 county tax sale bids are now subject to cancellation, told The Times he plans to pay back taxes by the deadline to save his company’s $430,899 in real estate investments.
“Man, absolutely. We’re scouring tax records now to see what we owe,” Wisniewski said.
Wisniewski said he believes he is being treated unfairly.
“You got me painted a villain,” Wisniewski told The Times. “You’re beating me up.”
Wisniewski owes at least $207,878.83 in delinquent taxes, either through his name or limited liability corporations tied to his name, according to county records.
Wisniewski also tied up in a lawsuit and felony theft case for allegedly stealing $34,000 in rent on properties he didn't own in East Chicago.
County attorneys say they will challenge Wisniewski's bids at a Sept. 26 court hearing.