News Articles - NOTFEA

Criminal Charges Filed After CBS4 Hidden Camera Catches Auto Dealer Red Handed

AURORA, Colo. (CBS4) – An Aurora auto dealer has been shut down after an undercover investigation by CBS4, and the attorney general’s office has now filed criminal charges against the dealership.The undercover investigation began when Annette Martin reached out to CBS4. Now the State of Colorado Motor Vehicle Dealer Board has closed CMC Auto.

USED CAR Folo

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“I ran my own Carfax and right at the beginning it showed ‘total loss,’” Martin said.

She bought a used Hyundai Tucson from CMC but claims she was not told the SUV was salvaged, and the 44,000 miles on the odometer was actually supposed to be 83,000. She discovered the vehicle’s problems after the purchase.

Martin eventually got her money back, but within days the vehicle was back up for sale by the dealer.

“That made me very upset,” Martin said.

With a hidden camera an undercover CBS4 producer looked at the SUV after Martin returned the Hyundai. The manager, Martin Bernuy, never told the undercover producer the SUV was salvaged or about the odometer’s replacement. In fact, now the odometer replacement sticker was removed, which is a federal offense.

CBS4’s Jennifer Brice confronted Bernuy.

“But you were still trying to sell it after she brought it back knowing the problems with the car,” Brice said. “Why did you think that was okay?”

“I didn’t think it was okay, that’s the reason I didn’t sell it here,” Bernuy replied.

Bernuy told Brice he sold the Hyundai back to the auction.

The state’s Motor Vehicle Dealer Board began investigating CMC Auto after CBS4’s story aired. Bernuy also told an investigator he sold the car back to the auction but they discovered the Hyundai was sold to a man named Jim. Jim says he was not told about the odometer or salvage issue.

The state’s full investigation looked into 160 deals sold by CMC Auto. Seventy-three of those cars contained documents indicating CMC’s business model includes buying collision and hail damaged cars from auctions, repairing the cars, and then selling them to customers without written disclosure about the damages.

“You’re going to be on the news, on CBS4. Do you have anything to say about your business; how you’re running things? This is your opportunity,” Brice said to Bernuy.

“I like people (to) be happy with the car. If you are not happy with the car, come to me, I fix it,” Bernuy replied.

In the Motor Vehicle Dealer Board’s affidavit it says CMC Auto violated eight Colorado laws, from defrauding buyers, failing to disclose damages, and false odometers, among others. The board voted to suspend the dealer’s license.

“They have engaged in willful and deliberate acts and their conduct imposes a threat to public health, safety and welfare,” Motor Vehicle Dealer Board Agent in Charge Matt Heap said.

Knowing a car’s actual mileage and prior damage not only affects safety, but the car’s value — something Martin learned the hard way.

“It was very much a hassle and I was very afraid that were not going to get our money back and we were stuck with an 83,000-mile car,” Marin said.

CBS4 tried reaching out to the owners and manager of the dealership. They did not respond. The Motor Vehicle Dealer Board says the dealership has a few options — relinquish their license, attempt to negotiate a settlement, or request a hearing.

Original Article: http://denver.cbslocal.com/2015/09/14/criminal-charges-filed-after-cbs4-hidden-camera-catches-auto-dealer-red-handed/

Odometer Rollbacks Common With Used Cars In Colorado: ‘It’s Criminal’

DENVER (CBS4)– The used car market is big in Colorado and with that comes the potential of odometer fraud for consumers. Colorado ranks top 10 in the nation for having the most cars with odometer rollbacks, which translates to nearly 20,000 vehicles on the road right now, according to Carfax.

“It looked really good on the eBay listing,” said Wayne Boncyk about the Jeep he spotted online. “The mileage was reasonable for nine-year-old car.”

At 109,000 miles the Jeep Cherokee seemed like the perfect SUV for Boncyk’s son to drive to and from college so he bought it. Boncyk later ordered a Carfax report, wanting to know about possible recalls, but found something even more concerning.

“There weren’t any additional recalls,” said Boncyk. “There was a flag that said odometer discrepancy.”

The Carfax report shows the mileage at 109,000 in 2010 but by 2013 it was 173,000 miles.

“This is my son’s vehicle,” said Boncyk. “His safety is at stake. We’re talking about 40 percent more mileage on that thing then I was lead to believe that thing had.”

It’s now been a year-and-a-half since Boncyk bought the car. He tried reaching out to the seller but got no response. That seller, a 27 year old who lives in Nevada, told CBS4 he sold the Jeep for a neighbor who did not have an eBay account. He claims he does not know about a rollback.

Christopher Basso of Carfax says many consumers don’t realize odometer fraud still exists.

“We’re not looking for it when shopping for a used car,” says Basso.

He says many consumers believe the old analog odometers are the only way to rollback mileage, but the digital odometer’s can be easier. The equipment is simple to find online and is relatively cheap.

Boncyk has now done plenty of research on this issue, “Anybody with moderate computer hacking skills and the right equipment can set a modern odometer in five minutes.”

Mechanics say a car inspection won’t necessarily flag a rollback. It’s very hard to tell which is why they recommend buying vehicle history reports like Carfax and AutoCheck. Those might be your only way to spot odometer fraud.

Carfax said they collect data from 92,000 sources nationwide with about 14.5 billion records. Emission test records actually alerted the fraud on Boncyk’s Jeep.

“It’s not uncommon to see a rollback (ranging from) 100,000 to 200,000 miles,” said Basso.

Their data suggests the average rollback is about 50,000 miles. Carfax also says vehicles 14-15 years old are most susceptible to odometer fraud sith 60 percent of rollbacks occuring between 11-19 years old.

“It’s criminal,” says Boncyk.

Daria Serna with the Colorado Department of Revenue, which has an Auto Dealer Division, confirms that kind of fraud could affect safety.

“It could affect the value of the car. Many people purchase cars are low mileage because it’s identified as a low mileage car and in good condition,” according to Serna.

The Auto Industry Division investigates odometer fraud with licensed dealers in the state but individuals selling cars usually don’t get caught unless consumers file complaints. That’s exactly what Boncyk now plans to do with the Attorney General’s Office.

He also has a buyers beware for people looking to purchase a used car, “Until car manufacturers come up with tamper proof system in vehicles – do all the homework you can.”

Carfax claims the odometer fraud loss to consumers is $761 million annually. The average loss per car rollback is $4,000 for lost value and maintenance.

Original Article: http://denver.cbslocal.com/2015/09/22/odometer-rollbacks-common-with-used-cars-in-colorado-its-criminal/

8 from St. Louis area sentenced for vehicle title fraud ring

ST. LOUIS • Eight St. Louis-area men and women have been sentenced for their involvement in a ring that altered vehicle documents to obtain loans, prosecutors said Thursday.

The ring altered documents to remove lienholders before selling the vehicles or to obtain new loans, prosecutors said. They also reduced the value of the vehicles on documents or changed the state of residence of owners to dodge taxes and license fees, they said.

Federal, state and local investigators were able to document $311,000 in losses due to the scheme, but estimate that the true loss amount approached $1 million.

The eight defendants received prison terms ranging from probation to more than 11 years in prison.

The final defendant in the case, Justin Carter, 22, of St. Louis, was sentenced Wednesday to five years in prison. The leader, Randall Hinton, 33, of St. Louis was sentenced Aug. 11 to 11 years, four months in prison, prosecutors said.

Original Article: http://www.stltoday.com/news/local/crime-and-courts/from-st-louis-area-sentenced-for-vehicle-title-fraud-ring/article_caf48294-7e55-5095-9ab7-c77e17635956.html

Two accused of car scam

Odometer on Dashboard

Two accused of car scam

Two men are accused of running a car racket in which they sold second-hand vehicles with false odometer readings.

Police allege the men bought 20 vehicles with high kilometre readings on sales websites this year.

They then allegedly bought car parts, including odometers with lower readings, from wreckers and swapped them into the vehicles before selling them to unsuspecting buyers.

The men also allegedly changed log book records to match the modifications and removed service stickers from vehicles.

By wiping off thousands of kilometres, the vehicles appeared newer and worth more, police claim.

Regional investigations unit officers swooped on the pair after spotting two sales advertisements for what they alleged was the same vehicle with different odometer readings.

Officers raided a Victoria Park property and allegedly seized documentation, vehicle service stamps and log books connected to the fraudulent modifications and sales.

The men, who are in Australia on student visas, allegedly made almost $40,000 profit from the scam this year.

One man who allegedly bought a Holden sedan from the pair said the odometer showed it had done 80,000km but he was told by police it had actually travelled 180,000km.

He claimed a check by a mechanic had not picked up the illegal modification.

“It’s a safety issue as well as an expense – because the car has been driven more than I thought, it will probably have more problems and because it had been tampered with, it isn’t even worth what it would have been with the correct odometer reading,” he claimed.

Police have charged a 28-year-old man with 19 counts of gains benefit by fraud and one count of attempted gains benefit by fraud. A 27-year-old man has been charged with 19 counts of gains benefit by fraud and two counts of attempted gains benefit by fraud.

They are both expected to face Perth Magistrates Court on September 15.

The police investigation is ongoing into vehicles sold last year 2014.

Original article: https://au.news.yahoo.com/thewest/wa/a/29301489/two-accused-of-car-scam/

Bremerton cops nab 2 in odometer-rollback scam, 1 at large

BREMERTON, Wash. — Three brothers are accused of ripping off dozens of car buyers in Bremerton by rolling back odometers to sell the vehicles at a higher price.

Bremerton Police arrested two of the brothers on Wednesday then served warrants at two Navy Yard City properties located in the 3700 block of Madrona Street and the 3700 block of C Street, where the vehicles were stored. During the search, detectives impounded at least three vehicles that were not registered to the properties.

“Unfortunately, most of (the victims) didn’t know they’d been taken advantage of until I contacted them,” said Bremerton Police Det. Martin Garland.

The organized crime investigation started in January 2014 after a victim found a repair invoice in a vehicle that was purchased from the suspects. The victim noticed the mileage didn’t look right, checked the car’s history on CarFax, and determined the mileage was incorrect.

Bremerton Police said the brothers purchased the cars on Craigslist then resold them at higher costs after rolling back the odometers, which would make it appear the cars didn’t have as many miles so the suspects could get more money.

“One of the big pieces to this puzzle was we were able to determine the CarFax account that our suspects were using and they, themselves, were running a CarFax on the vehicles,” said Det. Garland. “They would print that out, alter the mileage on the CarFax report, and then provide it to the victims as proof of the mileage.”

Detectives subpoenaed the records for the suspects’ CarFax account and learned the suspects had done more than 3,000 searches for vehicles.

Detectives said the men always made cash transactions and they did not register the titles of the cars to make it appear they were never in possession of the vehicles.

In some cases, the suspects rolled back the odometers 150,000 miles. On average, the brothers made about $1,200 per deal.

So far, detectives have confirmed the suspects sold 40 cars with false odometers but they believe the suspects actually sold more than 200. The investigation has required extensive research on each vehicle that involves contacting the new and previous owners, checking the vehicle history, and CarFax reports.

“One of the scary things in this case is the mileage and money can be replaced but the safety they’re taking from these victims – they provided invoices that said their brakes had been fixed when they hadn’t,” said Det. Garland.

Detective Garland said one of the suspects appeared to be such a good salesman he even posed for photographs with some of the victims after the purchases were complete. The suspects usually agreed to meet the buyers in the parking lot of Bremerton businesses so that’s why Bremerton Police has jurisdiction on the case.

“He knew everything about the car up and down. At least that’s what we thought,” said one victim who purchased a 2002 Subaru from the suspects after responding to a Craigslist ad.

The victim said her husband quickly became suspicious of the $5,000 purchase and looked up the car’s history on CarFax. That’s when they learned the car, which they thought had 92,000 miles when purchased, had a higher mileage. The couple contacted the former owner and learned the car actually had 230,000 miles when it was sold to the suspects.

The suspects are facing more than 100 felony counts that include leading organized crime, forgery, and illegal vehicle transfers.
By: Casey Edds

Couple accused of running a chop shop

David Bernando Cruz

Joselyn Cruz

TAVARES — A two-county investigation has shut down an Astatula chop shop whose operators are accused of dealing in stolen cars from three states, authorities said.

David Bernando Cruz, 30, and his wife, Joselyn Cruz, 31, were charged with operating a chop shop. David Cruz has been released from the Lake County Jail after posting a $50,000 bond. Joselyn Cruz was jailed in Osceola County on the same bail.

Lake County detectives began investigating the two after receiving information from the Osceola County Sheriff’s Office regarding the couple having a large amount of vehicles to sell and looking for a place to get rid of them.

The couple allegedly stole vehicles throughout Florida, as well as in Alabama and Georgia, with a tow truck they owned. They reportedly rolled back the mileage and covered up any damage to the vehicles.

It also was alleged that David Cruz would get vehicles from owners who couldn’t make their car payments under an agreement that he would assume the payments. He then allegedly hid those vehicles from repossession companies until he could obtain fraudulent titles on the vehicles and resell them.

Lake County sheriff’s detectives eventually learned of a warehouse at 14200 Corkwood Lane in Astatula,where the couple had allegedly been hiding vehicles.

Detectives executed a search warrant on the property in Astatula and discovered 16 vehicles, two of which were confirmed stolen, and some with missing vehicle identification numbers.

The owner of a car dealership in Osceola County allegedly agreed to allow the couple to use his lot for a portion of the proceeds.

Lake sheriff’s Sgt. Fred Jones said Tuesday that an investigation recently wrapped up by the Osceola County Sheriff’s Office included evidence gathered during a search of the auto sales business. Following the search, additional charges were filed against David Cruz, including grand theft auto, dealing in stolen property and selling motor vehicles with altered numbers.

Lake sheriff’s Lt. John Herrell said the Osceola County sheriff’s investigation is ongoing and additional arrests are likely.

Original Article: http://www.dailycommercial.com/news/article_542ec792-d7e1-5d2f-a63b-e16c30e4150a.html

Eye on Scams: odometer fraud

Almost everyone has shopped for a used car and buying a used vehicle is always a big deal for most consumers. Savvy buyers spend days or weeks searching for the right vehicle at the right price to fit their needs.

When shopping for a used vehicle and during the buying process, a major consideration is the mileage on the pre-owned vehicle. Better Business Bureau Serving Acadiana offers advice to help consumers ensure they are not taken by odometer fraud.

BBB alerts consumers that one in 10 American vehicles has a tampered or “rolled back” odometer, according to the Consumer Federation of America. According to Car Fax, a BBB Accredited Business, odometer fraud is one of the oldest automotive scams and the introduction of digital odometers has done nothing to halt it.

BBB offers the following tips to help consumers detect odometer fraud when purchasing a used vehicle:

Always check with BBB first.
Compare the mileage
Inspect the vehicle
Hire an expert to inspect

If you realize that you have bought a car with a rolled back odometer, report it to the Louisiana Office of the Attorney General at: http://www.ag.state.la.us/Article.aspx?articleID=37&catID=0 .

Original Article: http://klfy.com/2015/05/11/eye-on-scams-used-cars/

Ex-North Hills Car Salesman Gets Prison In Odometer Fraud Scheme

CBS2 Investigative Reporter David Goldstein first confronted Shamai Salpeter (right) and uncovered the odometer fraud scheme in 2012. (CBS)

LOS ANGELES (CBSLA.com) — A former San Fernando Valley car salesman was sentenced Monday to a year in federal prison for rolling back odometers for people who exceeded mileage limits on their leases.

Jeffrey Levy, 62, was also ordered to serve three years of supervised release upon getting out of prison and to pay restitution of about $115,800 to the owners of 21 cars with altered odometers.

U.S. District Judge George H. King ordered that $35,000 of the amount be paid immediately.

Levy was also prohibited from employment related to the purchase, sale, leasing, or financing of new or used motor vehicles during the period of supervised release and ordered him to undergo treatment for mental health issues and a gambling addiction.

Prosecutors say while working at Galpin Ford in North Hills, Levy referred customers and friends to co-defendant Shamai Salpeter, 65, over a period of three years in a scheme in which people paid up to $400 to avoid penalties for exceeding mileage limits on leases or to increase auto trade-in values.

Salpeter previously pleaded guilty and is expected to be sentenced April 13.

Both men pleaded to conspiracy to commit odometer tampering.

Salpeter was the subject of a 2012 hidden-camera investigation of odometer fraud by CBS2 investigative reporter David Goldstein.

Original Article: http://losangeles.cbslocal.com/2015/03/16/ex-north-hills-car-salesman-to-be-sentenced-in-odometer-fraud-scheme/

USDOJ Press Release: Conspiracy Odometer Fraud Conviction/ Sentencing

Department of Justice

Monday, March 16, 2015 Car Salesman Sentenced to Prison for Odometer Fraud Scheme

A car salesman was sentenced earlier today in U.S. District Court in Los Angeles to serve one year and one day in prison on charges related to an odometer tampering scheme, the Justice Department announced.

Jeffrey Levy, 63, of Woodland Hills, California, was also ordered to pay $115,818.80 in restitution to victims who purchased vehicles without knowing the odometers displayed incorrect mileages. In November 2014, Levy pleaded guilty to one count of conspiracy to tamper with odometers.

“A car salesman should know better than anyone that odometer tampering is a fraud and a crime,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “As this prosecution demonstrates, criminals with an electronic tool can easily alter electronic vehicle odometers, defrauding future car buyers.”

Levy was a salesman at Galpin Ford in North Hills, California. In his guilty plea, Levy admitted that he referred customers and friends to his co-conspirator, Shamai Salpeter, who rolled back odometers in the driveway of his residence in Woodland Hills. Salpeter was also charged and pleaded guilty to odometer tampering and conspiracy to commit odometer fraud and is scheduled to be sentenced on April 13.

Levy knew that some of his customers had exceeded the maximum allowed mileage under the terms of their leases and wished to avoid fees and penalties. He knew that other customers wanted to lower the mileage on their odometers to make their vehicles more valuable when they traded in the vehicles. After Salpeter altered the odometers, Levy’s customers returned or traded in their vehicles with false, lower mileage readings. Levy accepted the vehicles without alerting Galpin Ford that the odometer readings were false. Future purchasers of the vehicles were defrauded because they purchased vehicles with false odometer readings. Galpin Ford cooperated with the government’s investigation.

“Tampering with odometers is a crime that puts consumers’ lives and wallets at risk,” said Administrator Mark Rosekind of the National Highway Traffic Safety Administration (NHTSA). “Not only do purchasers end up paying more for used cars, but rolling back the mileage on odometers hides necessary information that could ultimately affect a car’s safety and the costs of future repairs to consumers.”

This case is being prosecuted by Trial Attorney John W. Burke of the Civil Division’s Consumer Protection Branch. The case was investigated by the NHTSA’s Office of Odometer Fraud Investigation and California’s Department of Motor Vehicles.

NHTSA estimates that odometer fraud in the United States results in consumer losses of more than $1 billion annually and has established a special hotline to handle odometer fraud complaints. Individuals who have information relating to odometer tampering should call (800) 424-9393 or (202) 366-4761.

More information on odometer fraud is available on the NHTSA website, and tips on detecting and avoiding odometer fraud are available at this page.

http://www.justice.gov/opa/pr/car-salesman-sentenced-prison-odometer-fraud-scheme

Woodland Hills man will go to jail for odometer tampering

A man who was once a top salesman at a San Fernando Valley car dealership was sentenced Monday to a year in federal prison for conspiring to roll back vehicle odometers in a scheme in which people paid up to $400 to avoid penalties for exceeding mileage limits on leases or to increase auto trade-in values.

Jeffrey Levy, a former salesman at Galpin Ford in North Hills, was also ordered to serve three years of supervised release upon getting out of prison and to pay restitution of about $115,800 to the owners of 21 cars with altered odometers.

U.S. District Judge George H. King ordered that $35,000 of the amount be paid immediately.

The judge also prohibited the 62-year-old Woodland Hills resident from employment related to the purchase, sale, leasing, or financing of new or used motor vehicles during the period of supervised release and ordered him to undergo treatment for mental health issues and a gambling addiction.

Levy “defrauded his dealership and multiple customers,” undermining “the trust that people have” when they purchase or lease a car, King said.

The defendant told the court prior to sentencing that he would “probably deserve” whatever penalty came his way, adding that there were “so many things I could do for the federal government rather than be incarcerated.”

King ordered Levy to surrender to federal authorities on April 20 to begin his sentence.

A co-defendant, Shamai Salpeter, 65, previously pleaded guilty to conspiracy to commit odometer tampering and is expected to be sentenced April 13.

While working at the dealership, Levy referred customers, including friends, to Salpeter, who charged $100 to $400 to roll back the odometer readings, which he did using electronic tools in the driveway of his Woodland Hills home, federal prosecutors said.

Levy then accepted the vehicles for lease returns or trade-ins without alerting the dealership, “thus defrauding future owners of the vehicles,” according to court papers.

Defense attorney Robert Shapiro told the court that his client, once “the best salesman at Galpin Ford,” got into trouble out of a desire to “make himself feel a little more important than he actually was.”

Galpin Ford cooperated in the investigation, prosecutors said.

“Victims of odometer fraud lose thousands of dollars on what can turn out to be unreliable and potentially dangerous vehicles,” said Acting Associate Attorney General Stuart F. Delery for the Justice Department’s civil division.

Salpeter was the subject of a 2012 hidden-camera investigation of odometer fraud by CBS2.

Original Article: http://mynewsla.com/crime/2015/03/16/woodland-hills-man-faces-sentencing-for-odometer-tampering/