“DMV Investigator David Silva worked this case tirelessly on what eventually turned into a multi-year investigation. Silva’s determination and experience were a key component to the success of this case.” -Kenny Ehrman, President, Association of Motor Vehicle Investigators of California (AMVIC)
SAN JOSE – On January 30, 2017, a husband and wife from Cupertino were sentenced to prison for committing aggravated identity theft and conspiring to commit wire fraud in connection with their Sunnyvale auto dealership, 888 Auto Corporation.
Yujen Chen, 61, and Maria Chen, 59, pleaded guilty to using their automotive business to fraudulently lease luxury vehicles, including vehicles from Porsche, Mercedes-Benz, Audi, BMW, and Toyota, and then to export those vehicles abroad. Yujen Chen was sentenced to more than six years in prison, his wife to more than five years in prison.
“This case was based on a single complaint received by DMV Investigations,” said Kenny Ehrman, president of the Association of Motor Vehicle Investigators of California (AMVIC). “Subsequent complaints were filed with DMV and FBI regarding the dealership. DMV Investigations began working with FBI and IRS when it was determined the scope of crimes and the victims affected were nationwide.”
As part of the scheme, the Chens recruited friends and associates to serve as lessees on the vehicles and sometimes paid these people $500 to lease cars on the Chens’ behalf. The Chens promised the lessees that they would assume the lease payments and that the lessees would not be financially responsible for the lease. However, once the Chens convinced the person to sign the lease arrangement and the lessees turned the vehicles over to the Chens, the Chens typically made only initial payments to the automotive finance companies on behalf of the lessees. Then, as a part of the scheme, the Chens would identify foreign purchasers for the leased vehicles.
The Chens admitted they falsified DMV paperwork reflecting a transfer of title from the financing company or lessor to an entity owned or controlled by the Chens. The title transfer allowed the Chens to then forward the vehicle to a freight forwarder for the purpose of exporting the car to a foreign buyer. As a part of the scheme, the Chens also provided or caused to be provided customs paperwork to a freight forwarder that included a fraudulently obtained, or “washed,” DMV title. The Chens eventually caused the leased vehicles to be shipped abroad, then ceased making the financing payments on the leased vehicles, leaving the nominal lessees with a broken lease and no car.
The Chens also used stolen identities. Specifically, the Chens collected money and personal identifying information from individuals who had come into their business expressing interest in making a legitimate vehicle purchase. Then, instead of providing dealers the money received from the persons for the vehicles, the Chens simply kept the purchase money provided by the victims for themselves. Moreover, the Chens misappropriated the personal identifying information of these individuals in order to gain possession of cars using fraudulent leases or finance agreements. The vehicles were then exported using the same title washing, and exporting techniques.
The defendants were originally charged in a 24-count indictment filed November 20, 2013. They each pleaded guilty to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1343, and one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A. As part of the plea agreement, the government agreed to dismiss the remaining open charges at the time of sentencing.
In addition to the prison sentences, the Chens will be supervised for three years following their release. A restitution hearing is scheduled for March 2, 2017.
This case was investigated by the Internal Revenue Service, the Federal Bureau of Investigation, the United States Customs and Border Protection, the California Department of Motor Vehicles, and the California Highway Patrol.