You and the law | Call a car broker? Be Careful – Times-Standard
Many people who want to take the hassle out of buying or selling a vehicle, whether for business or personal use, hire a car broker – a kind of “middle man” who takes care of all the details and negotiations.
Tell them what you want, and for a flat fee that can be a percentage of the sale price, they’ll find it for you at a much better price than you can negotiate on your own in many cases. You hand them a check – or sign some loan paperwork – they send it all to the dealer who delivers the car to your home or office.
Also, people who have, say, an RV they owe money on and want to sell, could take it to a broker. Thus, upon sale, the broker repays the loan from the proceeds of the sale, takes a commission, gives the title to the new buyer and then returns the balance to the client. The buyer registers the RV and everyone is happy.
That’s how dealing with an auto broker is supposed to work, and usually does – except when it’s not. When an auto broker goes wrong, the consequences are millions of lost dollars, con artists sent to jail, and years of heartache for trusted customers.
One is Ralph Bush, 87, of Arroyo Grande, Calif., who had the misfortune to bump into Clovis-based California Motoring Company owner Scott Radtke in 2017.
“I’ve bought cars from them before and have always been treated well,” Bush said, adding, “and, famous last words, I never had or anticipated a problem.”
That would all change when he bought a 2017 Toyota Tacoma, from Toyota Scion of Hollywood, through the broker, paying the full $33,000.
Bush would discover that there was a first for everything, including membership in a special club: “Victims of the Radtke Fraud”, because Hollywood delivered the Tacoma to Bush, but they never received payment from California Motoring Company and Radtke.
Plan to rip off banks, customers
According to court documents from the $2 million+ fraud indictment:
“From January 2016 until June 2017, Radtke developed a scheme to defraud banks and customers. He received upfront payments from customers or their banks, but did not give that money to dealers. Instead, he spent it on business and personal expenses.
“Furthermore, he signed customer names on sales documents and loan applications, which led to banks granting loans without the knowledge or permission of customers and involved at least 47 vehicles. and over two million stolen dollars.”
A California DMV investigator I spoke with called it a “one-man crime wave,” facing 98 counts, including forgery, grand larceny, identity theft, theft from the elderly and passing bad checks.
Due to COVID, his trial has been suspended. So much for delayed justice. Guess who’s still out on bail?
Cautious about waiting for the check to be cashed
Wondering why he hadn’t received the title and registration promptly, Bush phoned the Toyota dealership and was told he hadn’t received payment from Radtke!
Now you have to visualize the management of Toyota of Hollywood sitting around a conference table with this order form delivering a new 2017 Tacoma to Bush in Arroyo Grande.
Perhaps, Joseph, a new employee says, “But boss, we haven’t been paid yet – shouldn’t we wait or contact Mr. Bush to see if he’s paid using a check on which he can stop payment until this thing is cleared up? Something is wrong! We need to protect ourselves and our customer – this doesn’t seem fair!”
“Nah, they still pay us,” replies his manager.
“And that’s precisely the problem, as rogue auto brokers typically collapse within months, with dealerships relying on a history of ‘always getting paid’ as an excuse to avoid the prudent business practice of getting paid! C It’s common sense, but a lot of car dealerships are driven by just one word: SALES!” said the DMV investigator.
I asked Damon Culbertson, President/CEO of Mercedes Benz of Bakersfield, how he handles these situations:
“With auto brokers, we only release the vehicle when their check actually clears or the finance company has funded the loan and we have our money.”
So who takes the loss?
Bush had a car he could insure but not register, and even if it was theft, it wasn’t the kind of loss his home insurance covered.
I analyzed the facts by nationally respected lemon attorney Bob Brennan of Los Angeles, who replied, “Contractually, you have to wonder who should bear the risk of loss by what he hasn’t made. Here, clearly, it was Toyota Scion of Hollywood that took a car out without being paid and must have known that Mr. Bush had paid the broker for it.
“It’s theft and they might have insurance coverage, but either way they had the ability to eliminate their own loss by refusing to deliver the car. That would have helped Mr. Bush as well. All things being Equally, I think they have to give him the vehicle title and license plate, he’s the most innocent in this situation.
I wrote Toyota Scion of Hollywood, stating the same thing, and my reader retained the services of a truly compassionate attorney, Erin Stratte of the Wade Law Group in Los Gatos.
She repeated my analysis in her correspondence with Hollywood attorney Toyota and in February 2022 they agreed to give Bush the title and registration of her Tacoma.
Five years and how much worry for an octogenarian? All of this is avoidable with less urgency to simply make a sale.
Dennis Beaver practices law in Bakersfield and welcomes comments and questions from readers, which can be faxed to 661-323-7993 or emailed to [email protected] Also visit dennisbeaver.com.