Filipino car dealership owner jailed for bank fraud has died
Jun Reodica sentenced to 10 years for $ 64 million scam
Eminiano “Jun” Reodica Jr., from the Philippines jailed for bank fraud, died on March 17, 2021 in Texas, sources confirmed to the Asian Journal. He was 76 years old.
Reodica was serving her 10-year sentence in federal prison for a bank fraud scheme that caused more than $ 64 million in losses to five banks.
Clearly, in the 1980s, Reodica was a successful Filipino immigrant, living the great American dream as an entrepreneur. He built his auto empire from the ground up and operated what was then the largest minority-owned company in Southern California, employing around 450 people, mostly Asians.
At that time, he was chairman of the Grand Wilshire Group of Companies, which operated about two dozen car dealerships, including Grand Chevrolet in Glendora, then the third largest car dealership in the country. It was quite an impressive feat for a young man who moved from Laguna, Philippines to the United States in the early 1970s and started working as a waiter.
In less than five years, he became vice president of an auto dealership in Encino and later founded an auto finance and loan company, laying the groundwork for what would become his legacy.
According to the San Gabriel Valley Tribune, Newsweek and the Wall Street Journal have touted its business empire as one of the leading car dealerships helping minorities buy cars and get auto loans.
Many Filipino Americans had invested in his businesses, some emptying their retirement accounts or borrowing from banks to invest with a compatriot they trusted, according to numerous reports in the Tribune between 1988 and 1995.
As a result of Reodica’s fraud scheme, the Grand Wilshire Group and Grand Chevrolet collapsed into bankruptcy in August 1988 amid all these fraud allegations, when Reodica fled to the Philippines.
The court proved Reodica was running a fraud scheme that caused millions of dollars in losses to banks (one of which collapsed as a result of losses suffered in the scam) and its more than 1,000 investors. In addition to being sentenced to 10 years in prison in 2017, Reodica was ordered to pay restitution of $ 29.7 million.
A Justice Department ruling said US District Judge S. James Otero called Reodica’s fraud scheme “extremely serious,” saying it caused “a lot of disruption, a lot of heartache” to “too much.” of victims to be counted ”.
Judge Otero said the defendant attacked members of the Filipino community, as well as numerous federally insured financial institutions, by perpetrating an extremely serious fraud scheme that resulted in total losses to individuals and financial institutions over $ 90 million.
“In addition to financial institutions, individual investors, who were primarily members of the Filipino community in Los Angeles, trusted the defendant with their money, the vast majority of which was lost as a result of the bankruptcy,” said the prosecutors in documents filed with the court. . “In total, investors suffered additional losses of $ 24.9 million.”
Reodica, nicknamed “Bernie Madoff of Brisbane” according to government sentencing documents, was a fugitive for 24 years, living a new life in Australia.
He was arrested on November 28, 2012 at Los Angeles International Airport during a layover on his way from Australia to Canada en route to attend his stepdaughter’s wedding, as previously reported by the Asian Journal. A mandatory fingerprint check revealed he was the fugitive wanted by the FBI after more than two decades. When FBI special agents arrested him, Reodica was traveling under an Australian passport in the name of “Roberto Coscolluela”.
According to FBI reports, while living in Australia as Coscolluela, Reodica ran a tax preparation and insurance business. Its activities in these companies have resulted in allegations of fraud of $ 7 million in the country, most of its victims are said to be Filipino-Australians.
Reodica pleaded guilty to 26 counts of bank fraud and misrepresenting financial institutions the day before his trial in October 2015.
From 1984 to 1988, the fraud scheme hit at least five banks – Union Bank, First Los Angeles Bank, Manilabank, First Central Bank and Imperial Savings.
Specifically, Reodica admitted to pledging the same car contract as collateral to two different banks at the same time. This plan involved directing employees to forge customers’ signatures on car contracts, then pledging the bogus contract to a second bank. The fraudulent conduct also involved repossessing and reselling cars without notifying the banks.
Reodica also admitted to concealing from banks that customers were behind on their auto loans.
In some cases, when the overall default rate exceeded a level acceptable to a bank, Reodica used GWG funds to make car payments, which allowed it to continue to use those overdue contracts as collateral. Reodica also had his employees sign auto loans for cars they weren’t actually buying so that Reodica could increase the lines of credit he got from banks.
“The scale of the fraud is virtually unprecedented,” prosecutors wrote in their sentencing memorandum. “[T]he financial institutions attacked by the defendant suffered losses of more than $ 64.2 million. Notably, Imperial subsequently failed and was placed in receivership with the FDIC based on losses suffered as a result of the defendant’s fraud.
“Over time, GWG has grown to become the second largest Chevrolet dealership in the United States and the third largest automobile dealership in the United States,” prosecutors wrote in court documents. “Due to the apparent success of GWG, [then-California] Governor [George] Deukmejian appointed the defendant to the California Department of Motor Vehicles board of directors, then ousted him from the board when his fraud was discovered.