Today’s reader question comes from Hank and regards the conflict of interest that can occur when a property manager working at the facility holding an auction wants to buy a unit. Not long ago we featured another reader question that dealt with some shady managers who were actually plucking the best goods from repossessed sheds before they were sold to the public on the big day. All in all, sounds like there are some pretty unsavory goings on at some of these storage facilities! Hank asks:
[quote] Hello, I wanted to know: is it ever OK for a manager to buy up the storage unit that is currently on auction? Some of my buddies say they have seen managers and other employees bidding on units around our area but I didn’t think this kind of thing was allowed? [/quote]
Wow, you guys are dealing with some morally corrupt storage companies! Either there’s not enough oversight going on, or folks just do things drastically different where you live. To answer your question, a manager buying up an auction unit where he or she works is a big NO NO. Now, it might not necessarily be illegal, but it opens the company they work for up to massive vulnerabilities. How screwy does it sound for a manager to press the auction process hard and unrelentingly on a delinquent tenant, just to turn around and win their belongings on auction day?
Why Managers Should Never Buy Auction Units
I’m pretty sure I’m not the only one that would call foul to this kind of behavior. The company would have to worry about a wrongful sale lawsuit, which can be painfully costly when lost. Many times a wronged tenant has sued for many times more than the total value of their storage unit and they’ve won. That’s money that has to come out of the company’s pocket and profits!
If a manager in your area is stupid enough to be buying auction units at their own facility, and doing so blatantly enough that tenants like yourself are noticing it, they are in for a world of hurt if their bosses ever figure it out or if their company gets smacked with a wrongful sale lawsuit.
Are You a Manager Tempted to Attend Your Own Auctions?
If you happen to be a self storage property manager and you really just can’t wait to get your own dose of delinquent storage buying, just put on a baseball cap and go down the street to another company’s auction on your day off. Don’t risk your job and your company’s reputation by doing something as dumb as trying to buy a unit whose auction paperwork you processed!