Auto scammers fined, sentenced to 3 years of probation
April 30. 2013 2:27PM
CONCORD - Two California men were each sentenced to three years' probation and fined $5,000 Tuesday after pleading guilty to federal charges stemming from a scam to illegally export to China new luxury automobiles purchased in New Hampshire and 15 other states.
U.S. Attorney John Kacavas said Frank Hsiao Chien Ku, 31, of San Gabriel, Calif., and Danny Chin Hao Hsu, 33, of West Covina, Calif., pleaded guilty to mail fraud and U.S. Customs export fraud violations, which are felonies.
After falsifying documents through the use of "straw buyers" and agents, Kacavas said, the two shipped 93 vehicles, including one purchased in New Hampshire, to China falsely as used vehicles over a three-year period, Kacavas said.
Both men pleaded guilty to the charges last October. The charges were kept under seal until Monday.
Kacavas said that in the scheme, the two men obtained New Hampshire driver's licenses and automobile titles "by deception, defrauded car dealerships, and misused Shippers Export Declarations (SEDs) in furtherance of their plan to export new 'high-end' vehicles to China as 'used' vehicles despite knowing that the vehicles were fraudulently titled, ineligible for export, and were new."
According to an announcement Tuesday from Kacavas' office, "The scheme operators pose as local customers but in fact purchase cars for export to China and other countries where the most desirable luxury models can fetch as much as twice the sticker price in the United States."
New Hampshire Division of Motor Vehicles Director Richard Bailey noted that export rings "often prey upon the poor, who are enlisted to act as straw purchasers of luxury vehicles in exchange for a few hundred dollars," according to the announcement from the U.S. Attorney's office. "These individuals then face an array of problems when town and city assistance providers learn that they have purchased luxury automobiles in their names."
Kacavas and other federal officials, as well as state Commissioner of Safety John Barthelmes and other state officials credited "interagency cooperation" and pledged to continue to "combat title fraud in New Hampshire and to detect violations of export laws and customs regulations at our nation's borders."