An Oklahoma Kia dealership owner, and numerous former employees, were convicted of auto loan fraud, forgery, and aggravated identity theft. A federal jury found Bobby Mayes, Charles Gooch, and Courtney Wells guilty of using fraud to sucker finance companies to issue consumer loans to eligible buyers. With 25 counts that Mayes and Gooch were each accused of, they were found guilty of all of them.
Wells was convicted of 19 of the 25 counts. She was acquitted of six of the wire fraud counts. Prosecutors were from the US Attorney’s Office for the Western District of Oklahoma. The three worked at Big Red Dealerships, where the crimes took place from 2014 to 2019. Big Red includes Big Red Sports/Imports, Big Red Kia, Norman Yamaha, Norman Mitsubishi, and Mayes Kia.
The owner must now divest himself of his Kia car dealerships
Mayes owned the five stores and was CEO, according to Automotive News. Gooch was a compliance officer for the dealerships until 2018. He also owned part of Mayes Kia and Norman Mitsubishi. Wells was the main comptroller. Because of Kia’s dealership agreement, Mayes must divest himself of the stores. Neither of the other two found guilty owned any of the businesses.
Two of the three plan on filing appeals. “I am completely innocent of all these charges,” says Mayes. But prosecutors say that buyers with no or low credit were issued loans through fraudulent means. They say the dealerships reported inflated down payments, calling the practice “King Cash” according to prosecutors.
The scam started with Mayes and Gooch starting a pawnshop that was only a shell. They instructed Big Red staff to ask buyers if they owned items that could be pawned as a down payment. The staff would write up an appraised value for the item which was the same amount as the lender’s minimum down payment.
There was more than one scam
But the lenders were told the down payment was paid in cash. Much of the items were worth far less than their appraised amounts, according to authorities. Some were broken. But the dealerships would repay the “pawn shop” the amount given to the buyers.
In a related scam, buyers put up trade-in vehicles as down payments. But the customers would come back fairly quickly to buy back the trade-ins for a little as one dollar. Some of these “trade-ins” didn’t run.
Other times the loans were actually as much as three times the amount needed to purchase the vehicle. A Big Red manager was bribing loan officers with cash and writing up fake invoices that matched the inflated prices. But the big question is, ”Are there other dealerships doing similarly fraudulent scams?”