Whistleblower: Estate sale checks never came

  • Article by: KELLY SMITH , Star Tribune
  • Updated: May 7, 2012 - 10:44 AM

Several families say Birkeland & Associates sold their possessions and kept all the money. The company denies the allegations.

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Linda Pegelow, left, and Diane Agren are suing Birkeland & Associates.

Photo: Kyndell Harkness, Star Tribune

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Everything Dan Asleson owned -- from hooked rugs and Craftsman wrenches to a Toyota pickup -- was sold in one weekend estate sale after his sudden death in April 2010.

Now, 18 months later, his family is still waiting for the $21,000 that Golden Valley estate salesman Craig Birkeland owes them, money they say they need to support Asleson's 91-year-old mother.

The Bloomington family members aren't the only ones waiting for a check. From St. Paul to Santa Cruz, Calif., Birkeland's customers have sued him and his company, claiming he sold their possessions and pocketed millions in proceeds that belonged to them. In February, Minnesota Attorney General Lori Swanson filed a consumer fraud lawsuit against him and his company, Birkeland & Associates.

With no requirements for licenses or bonding, estate sales remain a largely unregulated business. A bill that would have required bonds was inspired by Asleson's case, but the proposal went nowhere at the Legislature. Meanwhile, estate sales are increasingly popular due to the recession and downsizing by retirees.

"It's a growing issue as baby boomers cash out and move in; there's a huge transference in wealth and property just starting," said Kurt Kiefer, a Fergus Falls auctioneer who's on the board of the National Auctioneers Association. "It's only in the last 10 years where it's grown to people having a business doing it."

He said he doesn't know of any state that licenses estate sale, or tag sale, companies. Auctioneers, however, must be licensed by the state. "It's ... a buyer-beware environment," said Ben Wogsland, from Swanson's office. "More regulation would be helpful."

Birkeland said Asleson's case is "being taken care of" and referred questions about the lawsuits to his attorneys, Mark Steffenson and Craig Freeman; they both declined to comment. In response to Swanson's lawsuit, they deny all allegations that he engaged in fraudulent, deceptive practices or collected money not entitled to him. The company, also known as Birkeland Estate Sales or Conducted Estate Sales Inc., remains in business, listing upcoming sales online.

For Asleson's cousin, Linda Pegelow, what happened to his estate spurred a "crusade" for better consumer protection against estate sale companies.

"There's nobody watching over them," she said.

Asleson, 50, of Minneapolis, died of heart failure in April 2010. His only surviving immediate family was his mother, who lives in a nursing home with advanced dementia. Pegelow and her sister, Diane Agren, were court-appointed to oversee the estate.

Soon after, they got a sales letter from Birkeland & Associates, which boasted 25 years of experience and had a positive rating with the Better Business Bureau. They signed a contract. In one weekend in November 2010, Birkeland & Associates sold Asleson's possessions, making $27,058, according to the receipt. After 30 percent commission for items, 12 percent commission for the cars and advertising costs, the family's proceeds were $21,649. Pegelow said she was told she'd be paid in four to six weeks.

Weeks passed, with no check. Birkeland blamed the delay on the holidays, year-end accounting, then lack of money. In June, the family filed a civil case in Hennepin County against Birkeland. Judge Denise Reilly granted a judgment in December, calling it "one of the more egregious cases I've seen."

In San Francisco, Bonnie Trach is still waiting for $7,000 from Birkeland after he sold furs, 300 pieces of jewelry and other items from her parents' St. Louis Park home after they died in 2009. In St. Paul, Martha Ballou said she was impressed by Birkeland's sales pitch, but still hasn't gotten her cut of $15,000 from September's sale. And in Wayzata, Suzanne St. James said she hasn't been paid for $5,000 worth of four china sets and other antiques Birkeland sold in October when she downsized to a condo. "I don't know if I'll ever get my money back," St. James said. "What concerns me is he's still out there doing business."

The BBB now rates Birkeland & Associates an 'F' due in part to the 20 complaints in the last three years and failure to resolve the underlying issue.

The state attorney general's office received several complaints before suing Birkeland and his firm. Despite promising payments four to eight weeks after a sale, the suit states, he gave customers vague excuses for delayed payments. His trial is slated for December.

Pegelow's story prompted Rep. Linda Slocum, DFL-Richfield, to sponsor a bill requiring estate sale companies to enter a bond of at least $20,000 with a county before a sale. The bill didn't get a hearing.

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