Former Missouri Resident Admits Role in Odometer Roll Back Scheme

Department of Justice

U.S. Attorney’s Office

District of Connecticut

FOR IMMEDIATE RELEASE

Monday, February 8, 2021

Former Missouri Resident Admits Role in Odometer Roll Back Scheme

SUSAN L. CUNNINGHAM, 48, of Monroe, Connecticut, formerly of Blue Springs, Missouri, pleaded guilty today before U.S. District Judge Michael P. Shea to one count of wire fraud stemming from the sale of numerous used vehicles with altered odometers.

Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the court proceeding occurred via videoconference.

According to court documents and statements made in court, between approximately August 2014 and October 2015, Cunningham and Wilfredo J. Albanese, while residing in Missouri, sold more than 40 vehicles with altered odometers to unsuspecting purchasers. As part of the scheme, Cunningham and Albanese purchased high-mileage used vehicles and then used a variety of means to alter or reduce the mileage shown on the vehicles’ odometers. They also concealed mechanical issues with those vehicles by removing “check engine” lights from the instrument panels, providing buyers with phony maintenance receipts and vehicle history reports, and concealing rust and other damage to the vehicle through paint or other means. Cunningham and Albanese obtained Certificates of Title for the used vehicles they purchased. Under the assumed identities of the persons listed on those Certificates of Title, they advertised and sold the vehicles to customers on Craigslist.org. Most of the victim purchasers resided in Missouri.

On May 22, 2019, a grand jury in the Western District of Missouri returned a 20-count indictment charging Cunningham and Albanese with offenses related to this scheme. The case was subsequently transferred from the Western District of Missouri to the District of Connecticut for further prosecution.

Wire fraud carries a maximum term of imprisonment of 20 years. Judge Shea scheduled sentencing for April 30, 2021. Cunningham is released pending sentencing.

On July 15, 2020, Albanese pleaded guilty to one count of wire fraud and one count of aggravated identity theft. On October 9, 2020, he was sentenced to 42 months of imprisonment and ordered to pay $51,600 in restitution.

This matter has been investigated by the U.S. Department of Transportation, National Highway Traffic Safety Administration (NHTSA), Office of Odometer Fraud Investigation, and the Missouri State Highway Patrol, with the assistance of the U.S. Marshals Service. The case is being prosecuted by Assistant U.S. Attorney Natasha Freismuth of the District of Connecticut, and Assistant U.S. Attorney Brian Casey of the Western District of Missouri.

NHTSA estimates that odometer fraud in the U.S. results in consumer losses of more than $1 billion annually. Individuals with information relating to odometer tampering should call NHTSA’s odometer fraud hotline at (888) 327-4236 or (202) 366-4761. More information on odometer fraud is available on the NHTSA website at https://www.nhtsa.gov/odometer-fraud.

NHTSA

December 22, 2020

Consumer Alert:

NHTSA’s Changes to Odometer Disclosure Requirements Starting January 1, 2021

WASHINGTON – The U.S. Department of Transportation’s National Highway Traffic Safety Administration is reminding consumers that, starting January 1, 2021, odometer disclosures will be required for every transfer of ownership for the first 20 years, beginning with Model Year 2011 vehicles. Model Year 2010 and older vehicles will continue to be subject to the previous 10-year disclosure requirements and thus are exempt from extended Federal odometer disclosure requirements.

The U.S. fleet of vehicles is, on average, older than ever, and NHTSA finalized this rule late last year to address an increase in odometer fraud involving older vehicles.

Model Year 2011 or newer vehicles will only be exempt from the odometer rules after 20 years. To comply with Federal law, anyone transferring ownership of a Model Year 2011 or newer vehicle will be required to provide an odometer disclosure to the new owner.

Model Year 2010 and older vehicles will continue to be exempt from federal odometer disclosure requirements. Sellers of Model Year 2011 vehicles must continue to disclose odometer readings until 2031.

Utah County man facing numerous odometer fraud cases is charged again

By Pat Reavy@DNewsCrimeTeam Aug 6, 2020, 10:09am MDT

Gavel
SALT LAKE CITY — A man who has several pending cases on charges of changing the odometers of vehicles and selling them has been charged yet again.

Steve Stone, 25, of Lehi, was charged Thursday in 3rd District Court with fraudulently changing an odometer, a third-degree felony.

On July 11, 2019, a man met with Stone to buy a vehicle he found online, according to charging documents. After purchasing the vehicle, the victim “checked the Carfax history and discovered a mileage discrepancy of over 90,000 miles,” the charges state.

The victim then found an article that originally appeared in the Deseret News that talked about Stone being accused of doing the same thing, and recognized Stone as the person who sold him the vehicle, according to charging documents.

For Stone, it’s the latest in a series of investigations involving odometer tampering.

He and two family members were charged in April 2019 with five counts of communications fraud and five counts of odometer violation. A pretrial conference for that case was scheduled for Aug. 24.

Stone was charged with similar crimes in April, July and October of 2018, and July 2017. A preliminary hearing regarding all of his pending cases was scheduled for Aug. 24.

Original Story here

Man pleads guilty in federal auto fraud case

By Tara Gray
Published: Sep. 2, 2020 at 6:25 PM EDT
DAVENPORT, Iowa (KWQC) – One of six men charged in an auto fraud scheme involving a now-closed Moline used vehicle business has pleaded guilty in federal court.

Court records show Kendric Vendrell McCray pleaded guilty Tuesday to conspiracy to commit wire fraud in U.S. District Court, Davenport. The charge carries a sentence of up to 20 years in prison, according to the written plea agreement.

He will be sentenced Jan. 14.

McCray and co-defendants Bradley Shane McCorkle, Isaac Bell, Derek Martinez, Keithen Deone McCorkle, and Nicholas T. McFarlin were indicted in November.

According to the plea agreement in McCray’s case:

4th Avenue Auto Sales, a used motor vehicle business at 4130 4th Avenue, Moline, was owned and operated by Bradly McCorkle and Bell.

The two men, through the business, bought cars from local auto dealers and auto auctions and accepted vehicle trade-ins.

McCray was acquainted with Bradley McCorkle for many years and, at times between 2012 and 2018, he worked for the business and performed odd jobs, such as mowing and driving cars for the business.

Generally, he was paid in cash by Bradley McCorkle.

Sometime between 2013 and 2018 or earlier, McCray, Bradley McCorkle, Bell, and others conspired to defraud the state of Iowa and purchasers of used motor vehicles by materially false and fraudulent pretenses, representations and promises, and by the intentional concealment of material facts.

McCray helped to conceal the price paid for used motor vehicles, the identity of the true owner and seller of used motor vehicles, and concealed the vehicle history of the used motor vehicles.

He also helped to conceal the actual mileage on more than 150 used motor vehicles, as well as the vehicles’ operating conditions and sale price.

McCray acted as a straw buyer of used vehicle for 4th Avenue and assisted in having his name used on sale documents, applications for vehicle titles, and titles of dozens of used motor vehicles.

He as strictly as “nominee buyer” for 4th Avenue, Bradley McCorkle, Bell, and sometimes Keithen McCorkle and McFarlin.

McCray was paid around $30 in cash by Bradley McCorkle for each vehicle McCray fraudulently titled in his name.

By having vehicles put in his name and applying for vehicle titles in Davenport, McCray facilitated the “washing” of the title histories, which included removing the mileage figure that appeared on the titles.

He did not reset or alter the odometers of the motor vehicles but made false and fraudulent representations when he applied for titles and engaged in “phantom, false, and illusory” transactions to that it appeared he bought the vehicles when he had not.

McCray further concealed the amount of money involved in the vehicle transactions including the prices paid for the vehicles.

McCray is not a mechanic and had no tools or other means to repair a motor vehicle. “Bills of Sale” produced by 4th Avenue in connection with motor vehicle transactions purportedly between 4th Avenue and McCray contained notations that some or all of these sales were “mechanics specials.”

These were false representations by McCorkle that allowed the vehicles to appear to have a lower value when applying for the title, thus reducing taxes and fees.

McCray was aware that the vehicles placed in his name were changing hands through 4th Avenue and being sold by third parties, including McFarlin, Keithen McCorkle, and others.

He also was aware of the vehicle he purportedly purchased as a straw buyer was being advertised for sale online, including through postings on Craigslist.

Around Dec. 5, 2014, 4th Avenue purchased a 2008 Dodge Caliber from Central Petroleum Company in Blue Grass. The vehicle at the time of purchase had an odometer reading of 177,700 miles.

Ten days later, 4th Avenue assigned the title, which listed an odometer reading of 45,584 miles, to McCray. He then reassigned it back to 4th Avenue with 45,584 miles.

Around Dec. 23, 2014, the vehicle was reassigned from 4th Avenue to an unwitting buyer showing that it had 45,708 miles on it.

McCray executed the false title application, claiming to own the vehicle, but he did not pay 4th Avenue and never took possession of it, according to the plea agreement.

Bradley McCorkle and Bell are each charged with conspiracy to commit wire fraud, six counts of wire fraud, 10 counts of tampering with a motor vehicle odometer, and securities fraud involving a motor vehicle.

Keithen McCorkle, McFarlin, and Martinez are each charged with conspiracy to commit wire fraud and six counts of wire fraud.

A trial is scheduled Sept. 29.

Original Story link here

‘High-Tech’ Thieves Hacked Into Newer-Model Nissans and Drove Away

Stolen cars were sold to unsuspecting buyers, police say
By Scott Gordon • Published June 11, 2020 • Updated on June 11, 2020 at 10:55 pm

Auto theft investigators say they’ve busted a “high-tech” ring of North Texas car thieves who hacked into newer-model Nissans, made their own electronic keys, and sold the cars to unsuspecting buyers.

“It can happen so fast,” said Commander Brian Sudan of the Tarrant Regional Auto Crimes Task Force. “We’ve seen thieves who can hack these cars in less than three minutes.”

The ring stole more than $1.2 million worth of cars from the streets of North Texas, some of them virtually brand new, police said.

Sudan didn’t want to give too many details on how the thieves were able to drive off in new cars but said they worked with used car dealers to get clean titles.

They do it by replacing the vehicle identification numbers so nobody knows it’s stolen, he said.

The number on a stolen 2020 Altima, for example, really belonged to another Altima which was found on a salvage lot to be sold for scrap.

Police have identified up to 62 stolen vehicles but suspect there are more. Only a small number have been recovered, Sudan said.

Gustavo Torres, 33, the alleged ringleader of the operation, was arrested.

Gustavo Torres

Investigators searched three used car dealers in Dallas who took the stolen cars and sold them to unsuspecting buyers.

“They have no clue they are buying a stolen car,” Sudan said.

So two people claim to own the same car.

“We run into some very sticky situations,” he said. “Somebody bought this car, paid a lot of money for it. And then there’s a person who lost this car and lost a lot of money.”

Sudan said the courts will have to decide the rightful owners.

He said there is little owners can do to protect their cars from getting hacked and stolen but did suggest locking doors, parking in well-lit areas and in a garage if possible.

As for used-car buyers, Sudan suggested researching the title and if it shows the car has been salvaged, it may indicate a problem.

While this car theft ring targeted Nissans, he said other thieves have learned how to hack into other brands such as General Motors.

View Original Story https://www.nbcdfw.com/news/local/high-tech-thieves-hacked-into-newer-model-nissans-and-drove-away-police/2387397/

Secretary Lawson provides restitution to victims of auto dealer scam

Gavel INDIANAPOLIS (May 29, 2020) — After receiving a consumer complaint about an auto dealer who illegally kept warranty payments, the Indiana Secretary of State’s Office has secured restitution for those affected by the crime.

In July 2019, a consumer contacted the Auto Dealer Services Division of the Secretary of State’s Office, claiming she had paid Stephens Automotive Group for a warranty, and that the warranty was never received by the warranty company. An investigator from Dealer Services reached out to the warranty company to confirm that Stephens Automotive Group had failed to transfers funds for several warranties, which failed to activate the warranties.

Multiple complaints followed over the next two months, and Dealer Services collected evidence verifying the consumer claims. In December 2019, an investigator from the Division met the owner of Stephens Automotive Group, where the owner admitted to not sending the money to the warranty company.

In February 2020, the Division issued an order for restitution requiring Stephens Automotive Group to pay a total of $8,673.00 to five consumers.

“I am proud of the work done by the Dealer Services Division, and very glad that this consumer complaint resulted in restitution,” said Secretary of State Connie Lawson. “Because of the cooperation between our Division, our constituents, and the warranty company, we were able to bring this case to a quick and fair conclusion.”

Consumers may file complaints against an Indiana auto dealership by visiting the Auto Dealer Services Division website at https://www.in.gov/sos/dealer/index.htm.

View Original Story here

https://calendar.in.gov/site/sos/event/secretary-lawson-provides-restitution-to-victims-of-auto-dealer-scam/

Police arrest fraud suspect hiding in his basement

Monroe Police Badge Monroe police officers arrested Jovani Capozziello, 33, with assistance from Bridgeport officers, at his home Tuesday, where he was hiding in the basement, according to police.

Jovani Capozziello

Capozziello was charged with illegal tampering with an odometer, third-degree larceny, third-degree telephone fraud, criminal impersonation, and three counts of second-degree forgery.

He was released on $25,000 bond for a July 24 court date, then released to the Bridgeport Police Department on its active arrest warrants for other incidents.

On Feb. 26, a Monroe man filed a fraud complaint, telling police he inquired about a vehicle posted for sale on Craigslist on Feb. 25 and spoke to the seller, who went by the name of Carlos.

After agreeing to terms, police said the victim met the seller at the Henny Penny gas station at 241 Roosevelt Drive in Monroe on Feb. 25, did a test drive and was satisfied with the vehicle, according to the report.

Police said he paid the seller $3,000 in cash for the Subaru and received a copy of the Connecticut Certificate of Title and Assignment of Ownership (Bill of Sale) for the vehicle.

But when the victim attempted to register and insure the vehicle, he discovered the title was fraudulent, the odometer had been altered and the Subaru was actually one year older than the seller originally told to him.

After communicating with “Carlos” about these discrepancies, he received an altered New York Certificate of Title that was mailed without a return address, police said.

During the investigation, Monroe police detectives used phone records to develop Jovani Capozziello as a suspect. Based upon this information and the victim’s statements, an arrest warrant was granted by the Superior Court.

View original story: Monroe Sun Article

Atlantic man pleads guilty to wire fraud

By Jeff Lundquist Atlantic News Telegraph Publisher 3/24/2020

United States District Judge has accepted a guilty plea from Atlantic businessman Larry Scott Fulk to one count of wire fraud for swapping out high mileage odometers with lower lower mileage ones without disclosing that to potential buyers.

Fulk, owner of Second Street Repair in Atlantic, had been facing three counts of wire fraud for selling vehicles out of state in California and Virginia and 15 counts of odometer fraud. Under the plea agreement, filed Feb. 21 and accepted last week, Fulk admits that he “knowingly devised a scheme to defraud the individual buyers by replacing the odometer cluster of the used car with another odometer cluster that had lower mileage. Defendant’s scheme to defraud sought to obtain money from the individual buyers by falsely representing the car to have lower mileage than the actual mileage of the car.”

The agreement goes on to state, “(the) Defendant advanced, furthered, and carried out the scheme by transmitting writings and other information by means of a wire communication in interstate commerce when he posted and advertised the used cars with a false mileage amount and inflated price.

The crime carries a maximum sentence of up to 20 years in prison; a maximum fine of $250,000; and a term of supervised release of up to three years. A mandatory special assessment of $100 per count of conviction also must be imposed by the sentencing court. The parties in the case have agreed to a sentencing guideline of between 12 and 18 months and the government has not to advocate for sentence higher than six months in prison — although the actual sentence will be determined by judge who does not have to follow the recommendations.

Sentencing is set for July 9 at 1 p.m.

Original article posted here

Department of Justice

U.S. Attorney’s Office

Southern District of Mississippi

FOR IMMEDIATE RELEASE

Wednesday, January 22, 2020

Two Mississippi Men Sentenced for Roles in Automotive Fraud Scheme

Two Long Beach, Mississippi men were sentenced today for their roles in a long-running odometer tampering scheme, the Department of Justice announced.

U.S. District Judge Louis Guirola Jr. sentenced Oscar M. Baine, 42, to 36 months’ incarceration and ordered him to pay $619,200 in restitution. Jeffrey Lyn Savarese II, 36, was sentenced to 15 months’ incarceration and ordered to pay $320,000 in restitution. Both men pleaded guilty in July to conspiracy to alter odometers. Baine also pleaded guilty to odometer tampering.

As part of his guilty plea, Baine admitted that he purchased high-mileage vehicles from wholesale automobile auctions, dealerships, and individuals, and arranged to alter the vehicles’ odometers to reflect false, lower-mileage readings. Baine admitted that he paid Savarese and others to change or alter odometers at his used car lot in Gulfport. Baine then sold the rolled-back vehicles to unsuspecting consumers for inflated prices. He also admitted that he and a co-conspirator caused at least 387 vehicles to be rolled back between 2011 and 2014, which resulted in consumer losses of more than $600,000. Savarese admitted that he began altering odometers for Mississippi and Louisiana used-car dealers in 2011 and reset the odometers on at least 200 used vehicles for Baine.

“The Department of Justice has long been committed to prosecuting automobile dealers, wholesalers, and mechanics who defraud consumers by selling vehicles with unlawfully altered odometers,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Vehicle mileage is critical to consumers who rely on that information to evaluate the value and safety of a used vehicle.”

“These criminals not only defrauded hundreds of people but they directly put families and the general public at risk,” said U.S. Attorney Mike Hurst of the Southern District of Mississippi. “We will continue to do all that we can to protect our citizens from fraudsters who endanger others just to make a quick buck.”

Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Andrea Jones of the U.S. Attorney’s Office for the Southern District of Mississippi prosecuted the case. The National Highway Traffic Safety Administration Office of Odometer Fraud Investigation (NHTSA), assisted by the State of Mississippi Office of the Attorney General, investigated the case.

NHTSA estimates that odometer fraud in the United States results in consumer losses of more than $1 billion annually. Individuals with information relating to odometer tampering should call NHTSA’s odometer fraud hotline at (800) 424-9393 or (202) 366-4761. More information on odometer fraud is available on the NHTSA website at https://www.nhtsa.gov/odometer-fraud and tips on detecting and avoiding odometer fraud are available at www.nhtsa.gov/staticfiles/nvs/pdf/811284.pdf .

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.

NHTSA Announces Final Rule on Electronic Odometer Disclosures

Rule will speed up processing of vehicle sales, help prevent odometer fraud

WASHINGTON – The U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) today announced the publication of a Final Rule establishing standards under which States may allow for odometer disclosures in an electronic format.

Odometer fraud is a Federal crime and NHTSA has required sellers to disclose vehicle odometer readings at the time of sale for decades. However, most vehicle transfers have been subject to a requirement that odometer disclosures be made in a paper format with handwritten names and wet ink signatures.

This Final Rule removes the paper requirement by allowing for electronic disclosure systems that have robust security and authentication. This action also removes the last remaining Federal impediment to paperless motor vehicle transfers.

By removing the paper documentation requirement, today’s Final Rule opens the door for State Departments of Motor Vehicles to move toward paperless transactions. Paperless transactions will save time and reduce costs for consumers and industry, create economic efficiencies, and improve security.

“This Final Rule was written after carefully considering comments received from the public, including state motor vehicle departments,” NHTSA Acting Administrator James Owens said. “As more records are kept digitally, this rule will allow electronic filing of odometer information. Electronic records are more efficient than paper documentation and are harder to forge, helping to prevent fraud.”

Current law does not require odometer disclosure with the transfer of vehicles at least 10 model years old. Due to the current average vehicle age of almost 12 years, an increasingly large proportion of the fleet is subject to a heightened risk of odometer fraud. To accommodate older vehicles, the Final Rule will require odometer disclosures until vehicles are 20 years old, beginning with the 2010 model year.

Read Final Rule

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