Auction.com Won auction, seller accepted, opened escrow, seller declined Irvine, California

Won the auction, wired earnest money, and opened escrow. After 3 attempts by Auction.com to get the right contract to me, I was told on  thursday 2/7, that buyer had accepted sale. Heard nothing on Friday 2/8.
Called Auction.com Monday 2/11 and was told that seller declined reason being it was an overcapped mortgage whatever that is. I talked to several people in the real estate and mortgage business they had no idea. One appraiser even told me he had just received a appraisal request from Nationwide for  the property.

The property was listed by the same realtor involved at the beginning with Nationwide on 3/26/13 approximately 1 1/2 months after it was pulled of the auction.It seems to me that this was all a ploy to come to some sort of asking price to remarket the property or some kind of insider trading.

Winning bid price-100000
Listing price-135000