timberland bag Export scammers’ gain is dealers’ pain

splitrock timberland boots Export scammers’ gain is dealers’ pain

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.

“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. 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. 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. 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. 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. 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.

How the vehicle exporting scheme run by Frank Ku and Danny Hsu from October 2009 through March 2012 worked

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. 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

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.”
timberland bag Export scammers' gain is dealers' pain