Four Serra Nissan Employees Plead Guilty to Auto Loan Fraud Conspiracy
BIRMINGHAM -- Four former Serra Nissan employees charged in connection with a conspiracy at the Birmingham car dealership to fraudulently boost loan approvals and car sales pleaded guilty today in federal court, announced U.S. Attorney Joyce White Vance, IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot and FBI Special Agent in Charge Roger C. Stanton.
D. SCOTT BURTON, 36, of Odenville, MICHAEL J. WILKINSON, 56, of Moody, TERRY W. HENDERSON, 39, of Pleasant Grove, and ROLAND W. RILEY, 28, of Birmingham, entered their pleas before U.S. District Judge Virginia Emerson Hopkins. All eight defendants charged in the conspiracy to defraud financial institutions, Nissan North America and Serra Nissan customers between August 2010 and October 2013 by fraudulently increasing vehicle sales in order to boost personal profits have now pleaded guilty.
DWIGHT A. PERRY, 44, of Birmingham, and ABDUL ISLAM MUGHAL, 48, of Trussville, pleaded guilty last year, and GERALD R. SHEPARD, 56, of Pinson, and JEFFREY R. GREEN, 33, of Porterdale, Ga., pleaded guilty earlier this year. The eight defendants are scheduled for sentencing between May and July.
"Predatory practices in providing auto loans to people with credit problems or insufficient income is akin to the fraud in mortgage lending," Vance said. "We are engaged in rooting out this fraudulent activity that threatens consumer safety."
Mughal, Shepard, and Burton were sales managers at Serra Nissan, Green and Wilkinson were finance managers, and Perry, Henderson and Riley were salesmen. All eight have pleaded guilty to the conspiracy. In addition, Mughal also pleaded guilty to bank fraud, Shepard to bank fraud and filing a false federal income tax return, and Green to failure to file an individual tax return.
According to court records, the Serra Nissan employees involved in the conspiracy used various means to carry out their fraud and obtain auto loans that, otherwise, would not have been approved. Those means included the following:
• Creating or altering documents to submit to financial institutions to show inflated income for prospective buyers.
• Directing finance managers and salesmen to submit fraudulent documents to financial institutions to misrepresent proof of a customer's residency.
• Listing accessories not actually included on a vehicle so a financial institution would increase its loan amount. The defendants and others had a financial incentive to increase a loan amount in order to increase commissions paid to certain employees.
• Presenting straw buyers, who could qualify for a loan, to financial institutions when the actual buyer could not qualify.
The maximum penalty for the conspiracy count is five years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1 million fine. The minimum penalty for aggravated identity theft is two years in prison.
The IRS and the FBI investigated the case, which Assistant U.S. Attorneys Amanda S. Wick and Robin Beardsley Mark are prosecuting.