Auto Loans Were Falsified: FBI Affidavit
CHARLOTTE, N.C. -- Employees of a longtime area auto dealer have been accused of falsifying loans for more than five years.
CHARLOTTE, N.C. -- Employees of a longtime area auto dealer have been accused of falsifying loans for more than five years. According to court documents obtained by The Charlotte Observer, the crimes include creating false employment and tax documents, and fake down payment checks, inflating customers’ incomes and increasing the loan values of vehicles.
Louis F. Harrelson, who has owned dealerships for 35 years, said he had been unaware of any wrongdoing by employees. After an internal investigation prompted by the FBI’s seizure of documents in June, Harrelson’s company fired seven employees, The Charlotte Observer reported.
The FBI affidavit named 15 current and former Harrelson employees. Also included was an employee at a Charlotte tax firm accused of creating false documents used by employees. Harrelson has promised to reimburse lenders.
The FBI isn't looking only at Harrelson's dealerships. Last week, a federal grand jury indicted Charlotte-area car dealer James Keating and 30 employees on charges of conspiring to falsify documents to qualify buyers for car loans totaling up to $15 million. Keating owned the Five Star, South Boulevard and Monroe auto malls.
More Compliance

Variations on a Theme – Lease Packing
Dealers must be careful they don’t run afoul of the law when it comes to such deceptive practices, as there are many cases pointing to the potential bad ends of such deals.
Read More →
Your 10-Point Compliance Checklist
Identify areas of concern and opportunities for training by updating, installing and enforcing a compliance checklist that requires specific actions for sales, F&I and accounting.
Read More →
A Continuing Antediluvian Dealer Fraud: Payment Packing
The longtime illegal practice, which can take many forms, can get a dealer and its employees in deep trouble. It’s a good idea to determine if anyone in your stores is doing it and to weed it out if so.
Read More →
Line 1 Is Not a Junk Drawer
Rolling products into the cash price — even if the bank told you to — misrepresents the vehicle’s value and runs afoul of four federal laws.
Read More →
Dueling Banjos in the Car Biz
Reports and accounts at variance show auto dealers’ trust profiles have risen in many consumers’ minds but that there remains a need for greater transparency by some.
Read More →
NADA and the Miracle on 34th Street
Automotive dealers should follow the National Automobile Dealers Association's consumer-friendly guidelines in order to minimize their legal risks.
Read More →
Another Look at a Recent Data Breach
Get caught up on the most pressing legal and regulatory matters facing dealers and F&I professionals, including data security, shotgun purchases, and inconsistent payment quotes.
Read More →

The Best Thing a Dealer Can Do to Avoid Legal Problems
Citing the issue is a strategy borrowed from the legal field itself.
Read More →
