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LoJack Corporation Helps California Police Recover 13 Cars and Break Up Large Auto Theft Ring
On January 18, 2013, the owners of California Car Company contacted the Brea Police Department to report a 2004 BMW Z-3 had been stolen along with 12 other exotic cars from the lot of their dealership. Thieves broke into the car lot office, located the keys and were able to, for the time being, get away with it.
Brea Police verified the theft and entered the vehicle information along with the 12 other vehicles into the state and federal crime computers, which automatically activated the LoJack transponder concealed in the BMW.
Out of the 13 vehicles that were stolen, the BMW-Z-3 was the only vehicle equipped with a LoJack Stolen Vehicle Recovery System. A short time later, Los Angeles Sheriff’s Air-7 flight deputies picked up the silent LoJack signal, tracked and located the vehicle parked, and unoccupied, at a motel. Detectives and ground units were notified.
Prior to any of the assisting ground units arrival, a male and female were seen entering the vehicle and drove off. Apparently, when the male driver saw the helicopter, he fled at a high speed trying to out run the airship. Air-7 followed the vehicle, giving the direction of travel to ground units. The BMW blew out a tire, exited the freeway and entered a mall parking lot in the city of Pico Rivera. One suspect was arrested on site.
So far in the case, there have been four suspects arrested and charged. Furthermore, all 13 cars have been recovered. They are identified as a 2007 Maserati, 2009 Mustang, 2008 Mustang, 2008 Mercedes E350, 2005 Audi A-4, 2004 BMW M-3 (LoJack equipped), 2006 Bentley, 2012 Chevrolet Camaro, 2002 BMW 745, 2002 Mercedes 600, 2005 Mercedes SLK350, 2011 Hyundai Genesis and a 2008 BMW 28I.
The LoJack Stolen Vehicle Recovery System was installed in the 2004 BMW Z-3 on 10-3-2005 at BMW Gallery in Norwood, MA. The estimated value of recovered cars is $250,000.
For local coverage of this story please visit the links below:
NOTE: Portions of the story were obtained from Brea Police Department and the Los Angeles County Sheriff’s Department
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Application Requirements For Vehicle Dealers Auto Commercial
- Vehicle Dealer Handbook (PDF)
- Vehicle Industry Procedures (VIP) Manual (formerly the Dealer’s Handbook)
- Autobroker’s Endorsement
- Guide for Licensed Vehicle Dealers and Lessor-Retailers (PDF)
- Occupational Licensure Product List (PDF)
- Buy/Sell Procedures for New Vehicle Dealers
Vehicle Dealer Original License Forms (Including Autobroker)
Note: Forms may be completed before printing
Please print the appropriate check list to obtain a list of all the forms and any additional documents required for each license:
- OL 248A, New Dealer Application Check List
- OL 248B, Used Dealer, Dealer-Wholesale Only, and Autobroker Application Check List
Select the appropriate link to print the forms required for each dealer packet:
- OL 248N, New Dealer Application Forms
- OL 248U, Used Dealer, Dealer-Wholesale Only,and Autobroker Application Forms
Application forms may also be printed individually from the following list:
- OL 12, Application for Original Occupational License, Part C
- OL 21A, Original Application for Occupational License, Part A
- OL 25, Surety Bond of Dealer OR
OL 25B, Surety Bond of Motorcycle Dealer, Motorcycle Lessor-Retailer, All-Terrain Vehicle Dealer, or Wholesale-Only Dealer (Less Than 25 Vehicles Per Year) OR
OL 65, Notice of Acknowledgment / OL 94, Cash Bond, with Cash Bond OR
OL 64, Assignment of Insured Account to Department of Motor Vehicles / OL 65, Notice of Acknowledgment, with Passbook or Certificate of Deposit
- OL 53, Authorization to Release Financial Information
- OL 124, Certificate of Proposed Franchise (new automobile, commercial, motorcycle, all-terrain vehicle, motorhome, and recreational trailer dealers only)
- OL 902, Property Use Verification for Vehicle Dealer’s License
- OL29, Application for Occupational License Personal History Questionnaire, Part B (Required for each person listed under ownership on form OL 12)
- ADM 9050, Appointment of Director as Agent for Service of Process
- DMV 8016, Request for Live Scan Clearance (receipt) (More information about Live Scan) (Required for each person completing form OL29)
Additional Required Application Package Documents:
- Certificate of Completion, Dealer Education Program (Used Vehicle Dealers and Wholesale-Only Dealers)
- Proof of successfully passing the Used Dealer Test administered by DMV (Used Vehicle Dealers only and Wholesale-Only Dealers)
- Letter of Authorization (New Trailer Dealers only; required for each line)
- If filing as a Corporation, Limited Liability Company or Limited Liability Partnership owned businesses only: A copy of Articles of Incorporation, Corporate Minutes or other document filed with the Secretary of State, which identifies the officers, share holders and managers.
- Copy of your Fictitious Name Statement
- Signed copy of lease or rental agreement. Proof of property ownership may be required.
- Copy of your City and/or County Business License
- Copy of Board of Equalization Resale Permit
- Photograph(s) of business location, refer to Photograph Procedures
Place of Business Inspection
After you have arranged an appointment with an Occupational Licensing Inspector he or she will inspect the place of business where the dealer conducts business.
- The office of the principal place of business and each location of the dealership must be established to the extent that its construction is not temporary, transitory, or mobile in nature, except that a trailer coach office is acceptable providing it is not part of the dealer’s vehicle inventory being offered for or subject to sale while being used as an office of the dealership and otherwise meets the requirements of the Vehicle Code. The place of business is a place actually occupied either continuously or at regular periods by the dealer. Section 320, CVC.
- Inspect all books and records pertinent to the business. CVC Section 320 (a), CVC Section 1670, and CVC Section 1671 and CCR Title 13, Section 270.00, 270.02, 270.04 and 272.00
- Inspection of Display Area (not required if wholesale only). After you have arranged an appointment with an Occupational Licensing Inspector he or she will inspect the display area to ensure:
- The display area of the principal place of business shall be of sufficient size to physically accommodate vehicles of a type for which the dealership is licensed to sell.
- The display area must be clearly for the exclusive use of the dealer for display purposes only.
- Additional display areas are permitted within a radius of 1,000 feet from the principal place of business and any licensed branch location without being subject to separate licensing. However, such display areas must also meet the signing requirement as identified in Vehicle Code Section 11709 (a).Title 13, Section 270.08, 270.08 (a) and 270.08 (b)
- Inspection of Signs (not required if Wholesale Only Dealer). After you have arranged an appointment with an Occupational Licensing Inspector he or she will inspect the sign(s) to ensure:
Signs must be of a permanent nature, erected on the exterior of the office or on the display area, and be constructed or painted and maintained so as to withstand reasonable climatic effects and be readable as provided for inCVC Section 11709. CCR, Title 13, Section 270.06
A temporary sign or device may suffice when a permanent sign is on order. Evidence of such order shall be submitted to the Department prior to issuance of a temporary permit or license. CVC Section 11709(a)
Other Permits and Licenses
Copies of the following permits and/or licenses from other agencies must be submitted with your application:
Board of Equalization Resale Permit (Revenue and Taxation Code, Section 6066 and 6067)
All licensees selling vehicles or vessels, retail or wholesale, are required to file an application for a Seller’s Permit. The purpose of the permit is to enable the licensee to collect taxes on sales. There is no fee for the permit, but a deposit may be required. Applications can be made through your local Board of Equalization office. A copy of this permit is required as part of the application for a dealer and lessor-retail license. Pursuant to California Vehicle Code Sections 11617(a)(6) and 11721(f), the Department may automatically cancel your dealer or lessor-retail license for failure to maintain a valid seller’s permit.
Pursuant to Revenue and Taxation Code Section 6014, “Seller” includes every person engaged in the business of selling tangible personal property of a kind the gross receipts from the retail sale of which are required to be included in the measure of the sales tax.
Questions should be referred to BOE at (800) 400-7115 or refer to information published at Board of Equalization Publication 73(PDF).
City and/or County Business License
Licensees are required to obtain a city or county business license by the city or county licensing section in the area where the licensee is doing business. Contact your local city or county to obtain the business license. A copy of this permit is required as part of the application for a dealers license. If the City/County does not issue business licenses; a tax certificate or letter on non-issuance is required as part of the application for a dealers license.
If licensed as a Corporation, Limited Liability, or Limited Liability Partnership a copy of the Articles of Incorporation, Corporate Minutes or other document filed with the Secretary of State, which identifies the officers, share holder and managers with 10% or more interest in the business is required.
The following permits and/or licenses MAY be required by other agencies.
Dealers who will be providing automobile servicing and repair are required to file an application with their local Bureau of Automotive Repair office. The application process takes approximately six to eight weeks and includes a fee.
Bureau of Security and Investigative Service, Repossession Agency
Pursuant to the Business and Professions Code, Section 7502, no person shall engage within this state in the activities of a repossession agency as defined inSections 7500.1 and 7500.2 unless the person holds a valid repossession agency license or is exempt from licensure pursuant to Section 7500.2 or 7500.3.
Bureau of Security and Investigative Services
2420 Del Paso Road, Suite 270
Sacramento, CA 95834
Fax (916) 575-7290
Original Application Fees
The fees to become a licensed dealer are:
- $175 Non-refundable application fee
- $1 Family Support Program fee
- $70 For each branch location (if applicable)
- $70 For each dealer plate and $72 for each motorcycle plate (plus county fees, if applicable)
- This figure will vary depending on the county where your business is located
- Dealer plates are not required
- Auto brokers are not eligible for plates (no inventory)
- $225 New Motor Vehicle Board Fee, per location (new automobile, commercial, motorcycle, ATV, motorhome, and recreational trailer dealers only)
- $100 Autobroker Endorsement fee
The Family Support Program fee is paid on original and renewal applications.
Vehicle Dealer License Renewal Forms and Fees
- Proof of Continuing Education (required every two years)
- OL 45, Renewal Application
- OL 56, $50,000 Bond Exemption Application (Wholesale-Only Dealers, if applicable)
- OL 247, Special Plates (required if not renewing all plates)
- OL 257, Continuing Education Exemption Application (Wholesale-Only Dealer, if applicable)
The fees to renew a dealer license are:
- $1 Family Support Program fee
- $125 Renewal application fee
- $69 for each auto plate and $71 for each motorcycle plate (each dealer plate)(plus county fees, if applicable)
- $225 New Motor Vehicle Board Fee, per location (new automobile, commercial, motorcycle, ATV, motorhome, and recreational trailer dealers only)
- $75 Autobroker Endorsement fee
The Family Support Program fee is paid on original and renewal applications.
Vehicle Dealer License Modification Forms and Fees
Dealer License Exemption
A dealer who does not have an established place of business in this state but who is currently authorized to do business as, and who has an established place of business as a vehicle dealer in another state is not subject to licensure under this article if the business transacted in California is limited to the importation of vehicles for sale to, or the export of vehicles purchased from, persons licensed in California under CVC Section 11700 et seq., and CVC Section 11700.1.
Dealer License Exclusions
The term “dealer” does not include any of the following:
- Insurance companies, banks, finance companies, public officials, or any other person coming into possession of vehicles in the regular course of business, who sells vehicles under a contractual right or obligation, in performance of any official duty, or in authority of any court of law, if the sale is for the purpose of saving the seller from loss or pursuant to the authority of a court.
- Persons who sell or distribute vehicles of a type subject to registration for a manufacturer to vehicle dealers under this code, or who are employed by manufacturers or distributors to promote the sale of vehicles dealt in by those manufacturers or distributors. However, any of those persons who also sell vehicles at retail are vehicle dealers and subject to this code.
- Persons regularly employed as salespersons by vehicle dealers licensed under this code while acting in the scope of that employment.
- Persons engaged exclusively in the bona fide business of exporting vehicles or of soliciting orders for the sale and delivery of vehicles outside the territorial limits of the United States, if no federal excise tax is legally payable or refundable on any of the transactions. Persons not engaged exclusively in the bona fide business of exporting vehicles, but who are engaged in the business of soliciting orders for the sale and delivery of vehicles, outside the territorial limits of the United States are exempt from licensure as dealers only if their sales of vehicles produce less than 10 percent of their total gross revenue from all business transacted.
- Persons not engaged in the purchase or sale of vehicles as a business, who dispose of any vehicle acquired and used in good faith, for their own personal use, or for use in their business, and not for the purpose of avoiding the provisions of this code.
- Persons who are engaged in the purchase, sale or exchange of vehicles, other than motorcycles subject to identification under this code, which are not intended for use on the highways.
- Persons temporarily retained as auctioneers solely for the purpose of disposing of vehicle stock inventories by means of public auction on behalf of the owners at the owner’s place of business, or as otherwise approved by the department, if intermediate physical possession or control of, or an ownership interest in, the inventory is not conveyed to the persons as retained.
- Persons who are engaged exclusively in the business of purchasing, selling, servicing, or exchange racing vehicles, parts for racing vehicles and trailers designed and intended by the manufacturer to be used exclusively for carrying racing vehicles. A “racing vehicle” is defined as a motor vehicle of a type used exclusively in a contest of speed or in a competitive trial of speed which is not intended for use on the highways.
- Any person who is a lessor.
- Any person who is a renter.
- Any salvage pool.
- Any yacht broker who is subject to the Yacht and Ship Brokers Act (Article 2 (commencing with Section 700) of Chapter 5 of Division 3 of the Harbors and Navigations Code) and who sells boat trailers in conjunction with the sale of a vessel.
- Any licensed automobile dismantler who sells vehicles that have been reported for dismantling as provided in Vehicle Code Section 11520.
- The Director of Corrections when selling vehicles pursuant to Section 2813.5 of the Penal Code.
Any public or private nonprofit charitable, religious, or educational institution or organization that sells vehicles if all of the following conditions are met:
- The proceeds of the sale of the vehicles are retained by that institution or organization for its charitable, religious, or educational purposes.
- The vehicles sold were donated to the institution or organization.
- They meet all of the applicable equipment requirements of Vehicle Code Division 12 (commencing with Section 24000) and have been issued a certificate pursuant to Section 44015 of the Health and Safety Code.
- The institution or organization has qualified for state tax-exempt status underSection 23701d of the Revenue and Taxation code, and federal tax-exempt status under Section 501 (c)(3) of the Internal Revenue Code.
Any motor club, as defined in Section 12142 of the Insurance Code, that does not arrange or negotiate individual motor vehicle purchase transactions on behalf of its members but refers members to a new motor vehicle dealer for the purchase of a new motor vehicle and does not receive a fee from the dealer contingent upon the sale of the vehicle.
California Vehicle Code. Sections 20, 285 – 286, 320(a), 426, 3000 et seq., 5753, 8803, 10750 10751, 11700 et seq., 11800, and 11824. The California Vehicle Code is available for purchase from the Department of Motor Vehicles.
California Code of Regulations . Title 13, Chapter 1.
Business and Professions Code . Sections 9889.50-9889.53, and 17500.5.
Civil Code . Sections 2981-2984.4.
Government Code . Section 6157 (a) – (d).
Health and Safety Code . Sections 43150-43156, 43200-43213, and 43600-43660.
You will need Adobe Acrobat Reader (version 5 or greater) to view some of the linked documents on this page. If you have problems with Acrobat Reader see the Adobe Troubleshooting page for possible solutions.
Application Questions and Submission Information
Please refer to the Vehicle Dealer Handbook (PDF)
Autobroker s Endorsement
An autobroker’s endorsement requires payment of fees as required by subdivision (d) of Section 9262 of the California Vehicle Code.
A dealer may not engage in brokering a retail sales transaction without having an autobroker’s endorsement to their dealer’s license.
Upon issuance of an autobroker’s endorsement to a dealer’s license, the department shall furnish the dealer with an autobroker’s log. The autobroker’s log remains the property of the department and may be taken at any time for inspection.
The autobroker’s log must contain the following information with respect to each retail sale brokered by that dealer:
- Vehicle identification number of brokered vehicle
- Date of brokering agreement
- Selling dealer’s name, address, and dealer number
- Name of consumer
- Brokering dealer’s name, address, and dealer number (CVC Section 11735)
A dealer who brokers a motor vehicle sale shall deposit directly into a trust account any purchase money, including purchase deposits, it receives from a consumer or a consumer’s lender.
- All trust accounts required by CVC Section 11737 shall be maintained at a branch of a bank, savings and loan association, or credit union regulated by the state or the government of the United States.
Export scammers’ gain is dealers’ pain
Feds seek headway against black-market rings
“This is a first of its kind prosecution, and I hope it will not be the last. These rings are far reaching,” said John Kacavas, the U.S. attorney for New Hampshire.
July 1, 2013 – 12:01 am ET
First it was a $70,000 Mercedes-Benz GL350. Then another one, followed by a BMW X6 and a Porsche Cayenne. All were paid for in cash.
Jane Goss, the town clerk and tax collector in tiny Sanbornton, N.H., realized something was fishy after a local man started coming into her office every few weeks to register high-end SUVs.
“I knew that he didn’t have the means to pay for these cars fully,” said Goss, who also noticed that the man never drove any of the vehicles to her office. “I don’t know of anybody in Sanbornton who can do that. By the fifth one, I said, ‘No, I can’t register this car.’”
Federal authorities say the man unwittingly had become part of a scheme that illegally exported thousands of luxury vehicles to China. In what has become a burgeoning black-market industry, exporters typically hire straw buyers in the United States and send vehicles overseas by claiming them as used on customs declarations. The buyers often never see the vehicles they claim to be purchasing for personal use.
High prices and heavy demand for luxury cars and SUVs in China, caused in part by 25 percent tariffs on imported new vehicles, mean scammers can often sell the vehicles for at least double what they would get in the United States. A new BMW X6 costs more than 1 million yuan in China, or about $171,500, compared with a U.S. starting price of $60,725; the Porsche Cayenne has a base price of 922,000 yuan, or about $148,750, in China, and $50,575 at U.S. dealerships.
Even after factoring in considerable shipping costs and other expenses, the exporters can make a huge profit on each vehicle by undercutting legitimate dealerships in China.
The schemes can cause big financial problems for U.S. dealerships, which are contractually prohibited from selling new vehicles to anyone who intends to export them and can be penalized by the automakers for doing so — even if they do so unwittingly.
Dealerships that sell to exporters may be forced to pay charge-backs, have incentives revoked and receive fewer vehicles from the factory in the future. Widespread fraudulent registrations also hurt dealerships that do not sell to exporters because such registrations understate the dealerships’ actual market shares, making it appear they are falling short of sales targets. That can affect bonuses paid by automakers as well as future allocations.
New Hampshire has been at the center of several large export schemes because it is the only state with neither a sales tax nor a requirement that vehicle owners carry insurance. Exporters maximize their profits by having vehicles titled there, even though many of the vehicles are bought elsewhere and never enter the state.
John Kacavas, the U.S. attorney for New Hampshire, recently announced that two California men pleaded guilty to federal mail fraud charges and violations of U.S. customs laws, in what officials say was the first successful prosecution of a major vehicle-exporting operation. The defendants admitted to scheming to export 93 vehicles worth more than $5.5 million that they and others bought in 16 states.
Authorities seized 14 of the vehicles at California’s Port of Long Beach and began forfeiture proceedings. The men, Frank Ku, 31, and Danny Hsu, 33, were fined $5,000 and sentenced to three years probation in May.
“This is a first of its kind prosecution, and I hope it will not be the last,” Kacavas told Automotive News, while declining to discuss investigations into any other operations. “These rings are far reaching. Some are operating on a scale much grander than Ku and Hsu.”
In the case, Kacavas said his office was more focused on trying to recover as many vehicles as possible and deterring additional exporting than sending Ku and Hsu to prison.
Court documents say Ku and Hsu found straw buyers by looking on Craigslist for ads posted by people who appeared to need money. Those buyers, who received “a few hundred dollars” for each vehicle they purchased, were not charged.
“Some of them were sort of hapless victims as far as we were concerned and not worthy of federal prosecution,” Kacavas said. “They made very little money from doing this.”
But for the exporters, he said, “it’s very lucrative.”
Ku and Hsu, who ran a company called CFLA, paid New Hampshire residents to use their addresses so they and other employees could falsely obtain local driver’s licenses. Court documents show they made some of the purchases themselves, in addition to using straw buyers, and in some cases they had an employee fly from California to pose as a straw buyer’s fiancee and handle all of the payment and paperwork.
• Ku and Hsu used Craigslist to find straw buyers and people who would let them use local addresses to obtain fake driver’s licenses.
• They or the straw buyers purchased high-end vehicles with checks from a local bank account. Straw buyers would earn several hundred dollars for each transaction.
• They applied for titles in New Hampshire, New Jersey and other states, claiming that each vehicle was for personal use and posing as the straw buyers when the Department of Motor Vehicles questioned the applications.
• Vehicles were shipped to the Port of Long Beach in California.
• After their titles were issued and forwarded to California, the vehicles were shipped overseas with export declarations that categorized them as used.
• When the vehicles got to China, Ku and Hsu delivered the vehicles to buyers who had ordered them in advance, often for more than double the U.S. price.
• They successfully exported 79 vehicles, and 14 more were seized in Long Beach. The average value of each vehicle was about $53,000.
Source: Court filings
Troopers issued warning
Goss, the clerk in Sanbornton, a town of about 3,000 people in the center of the state, said she had attended a class in which state troopers warned clerks to be on the lookout for suspicious registrations of high-end vehicles. The man she confronted started showing up about a year later, in late 2010.
When questioned by the town’s police chief, Stephen Hankard, the buyer readily acknowledged buying the SUVs for someone else and seemed unaware that he might be part of an illegitimate operation.
“He answered a Craigslist ad, and I think he honestly believed that what he was doing was legal,” Hankard said. “He seemed pretty confident in what he was saying.”
After alerting Immigration and Customs Enforcement officials in March 2011, Hankard said, “police chiefs from all over the place started calling me” because their clerks had noticed unusual vehicle purchases as well.
The Sanbornton buyer has not been charged with a crime. Information he gave customs agents helped lead Kacavas in May to charge a Chinese national, Hong Chen, who runs several businesses based in Maryland and Virginia, with mail fraud and misuse of export declarations.
Chen and his businesses are accused of illegally exporting nearly 3,000 vehicles worth more than $157 million — an average of about $53,000 each — from February 2008 through March 2013. About 40 vehicles being prepared for export were seized at the Port of Newark in New Jersey in April, documents show.
Chen was arrested in May, and a judge recently agreed to delay his trial until later this summer to allow for negotiations between prosecutors and his lawyer, who did not return a call seeking comment.
Detective Sgt. Andrew Player of the New Hampshire State Police said his agency has become more active in rooting out illegal vehicle exports, and legislators have discussed ways to make such crimes harder to pull off.
“It’s been going on for a while,” Player said. “We began to receive complaints from the automotive dealers themselves. They were concerned about what was going on and getting charge-backs.”
U.S. Customs regulations only allow new vehicles to be exported by their manufacturer, and still consider vehicles to be new if bought for resale purposes.
According to a deposition by the customs agent who investigated the Chen case, Mercedes-Benz USA has a policy allowing the company to impose the following penalties if it discovers that a vehicle was exported less than a year after being sold as new: “an administrative expense equal to 8.5 percent” of the suggested retail price, “any market support funds or special program discounts paid by MBUSA for that vehicle will be charged back” and “the dealership will lose one like-model unit on the next decade allocation.”
Paul Holloway, whose Holloway Automotive Group has two Mercedes-Benz stores and other dealerships in New Hampshire, said at an April news conference with Kacavas that his company had sustained losses “in the six figures” as a result of export schemes. “This is just a fraction of what’s going on,” Holloway’s partner, David Cushman, told the New Hampshire Union Leader newspaper.
Court documents in the Chen case say a 2010 Mercedes GL350 BlueTEC was bought in October 2010 from Holloway Motor Cars of Manchester and shipped to China about a month later. They show that only one of the four SUVs and crossovers registered in Sanbornton was bought in New Hampshire, with the others coming from Mercedes-Benz dealerships near Boston and a Porsche dealership outside Syracuse, N.Y., more than 300 miles away.
The X6 was bought at a BMW dealership — directly across the street from a police station — that officials said also fell victim to Ku and Hsu’s scheme.
You can reach Nick Bunkley at firstname.lastname@example.org. – Follow Nick on
TAX-FRAUD PROBE: Posh home, used-car lots raided
Agents confirmed on Tuesday, Oct. 29, that a search warrant was served at the address of 6990 Wyndham Drive, Riverside. — STAN LIM/STAFF PHOTOGRAPHER
BY DEBRA GRUSZECKI and BRIAN ROKOS | STAFF WRITERS
Two auto-sales businesses and a luxury home in Riverside were raided Tuesday morning by state agents and the Riverside County district attorney’s office as search warrants relating to an investigation into suspicions of sales-tax fraud were served on the occupants.
The warrants, obtained by the state Franchise Tax Board and Board of Equalization, included a probable-cause arrest warrant, said Tami Grimes, a spokeswoman for the Franchise Tax Board’s criminal investigation bureau.
Agents entered the home at 7 a.m. Tuesday, Oct. 29, Grimes said. The two businesses were searched at 8 a.m., she added.
Investigators at the county and state level declined to reveal details of the probe.
Fraud involving the automotive sales industry can take many forms. Investigations can range from sales tax evasion and employment-tax fraud to money laundering. One tool the government has to stem illegal activity is a law requiring cash payments of more than $10,000 to be reported to tax authorities.
In California, the main tax agency is the Franchise Tax Board. It provides information to the public about taxes owed, and investigates claims of tax fraud. The Board of Equalization collects sales and use taxes, and handles all reports of corporate sales or use tax fraud.
A One Auto Center, a used-car dealer, was launched in 1998 by Ahmad and Nader Samir, according to 2007 published reports in The Press-Enterprise and Entrepreneur magazine. That year, the company claiming its base in San Bernardino made the “Hot 500” rankings at No. 348 for 2006 sales of $56 million and 120 employees.
On Tuesday, both businesses were closed through the day.
State agents could be seen in the parking lots at various times, lugging banker’s boxes toward rented moving vans. At one point, a customer of the San Bernardino car sales company approached a Franchise Tax Board agent to ask if he could go inside to get the registration a car he said he bought.
Turned away, the customer said the agent he’d spoken with told him the business would likely reopen Wednesday. He left the scene, declining to give his name.
Just after 3 p.m., police from the state Board of Equalization and Franchise Tax Board removed a computer and at least four boxes of evidence from the Wyndham Hill house and put them in an unmarked white van.
Riverside County property records say the home is owned by Sami Nader, whose name also appears on several company-name variations of A-One Auto. He is listed as Sami Naden on corporate filings for A-One Auto Center Riverside Inc., a company listed by the state as being suspended.
Nader could not be reached for comment.
Throughout the day, there was no sign of any of the residents at the home or the businesses.
The online real-estate service Zillow.com describes the custom single-story home at 6990 Wyndham Hill Drive as Riverside’s “Taj Mahal.”
County records say the home purchased by Nader in April 2008 carries a value of $1.5 million, after the standard $7,000 homestead-tax exemption.
The narrative on the Zillow report, which is usually written by a real estate agent and can be edited by the property owner, says the seven-bedroom, five-bath home on 2.2 acres at one point received more than $2 million in improvements such as waterfalls, three full-size pools, a sauna, sports court, covered patios, fish tanks and gazebos.
The white house on the corner lot stands out, even among other fancy homes on the street. It stands behind a copper-colored wrought-iron fence punctuated by gold-colored medallions. Two granite fountains spill water into small pools on either side of the walkway.
And then there are the statues and sculptures, ranging from lions to Grecian-style women.
Two Bentleys and one Jaguar — all with paper auto dealer plates on them — were parked on the property Tuesday afternoon.
The property at 6990 Wyndham Hill is connected to a home at 6960 Wyndham Hill by an outside staircase.
Property records could not be immediately found at the county for 6960 Wyndham Hill. However, the Zillow listing says that 7,892-square-foot home has “expansion plans for about 24,000 square feet.”
This is not the first time police have raided a home on Wyndham Hill.
In September 2011, papers were served at the house across the street that was being rented by former San Bernardino Airport developer Scot Spencer. The raid came after a two-year grand jury investigation into airport operations.
Contributing to this report: Staff videographer Chris Ercoli, email@example.com, and staff writer Timothy Guy, firstname.lastname@example.org
Former Miramar Car Dealer Headed to Trial
By Mari Payton
On Monday, a judge decided there was enough evidence to send John Mussari, the former owner of Mussari Motors in Miramar, to trial. Mussari is accused of cheating clients out of tens of thousands of dollars. NBC 7 Investigates reporter Mari Payton has more.
Former Miramar Car Dealer Headed to Trial
On Monday, a former Miramar car dealer accused of cheating customers was bound over for trial, expected to start next month.
Thanks to reports from NBC 7 Investigates, the District Attorney’s Office says more potential victims have come forward, and they were finally able to get enough evidence to go to trial.
NBC 7 Investigates first revealed customer complaints about Mussari and his high-end car dealership, Mussari Motors, in Nov. 2011.
Five years after the first complaints of theft and financial fraud were reported to the DMV, John Mussari was bound over for trial on 16 counts and five allegations.
“Our goal is to obtain as much restitution as possible and to also seek justice on their behalf,” Deputy District Attorney Luis Mendez said. “A lot of them are very upset and they took tie out of their lives today to testify.”
Mendez said Mussari took pre-owned Ferraris, Lamborghinis and Mercedes on consignment, sold single cars to multiple buyers, never paid the original owners and defrauded finance companies and banks.
John Mussari was formally charged with 16 felonies in February.
He remains free on a $100,000 bond and is scheduled to be back in court Dec. 4.
Mussari is also the target of a federal investigation that involves money laundering and drug trafficking proceeds.
Mussari’s lawyer, Anthony Colombo, didn’t want to comment Monday afternoon, but previously pointed out to NBC 7 that the federal investigation has dragged on for years with no charges filed.
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