164 charges laid in vehicle consignment fraud investigation
The Calgary Police Service Economic Crimes Unit has laid 164 charges following an extensive vehicle consignment fraud investigation.
Between July 16, 2011, and August 31, 2014, 94 citizens brought 116 vehicles to an auto consigning company known as TREADZ Auto Group Inc., with the intention of selling their vehicles on consignment. The citizens paid a $299 consignment fee to the company and signed a contract stating that TREADZ would:
- Display, demonstrate and advertise the consignment vehicle,
- Pay the consignor a settlement cheque within 10 business days of selling the vehicle,
- Deduct and pay all liens, and
- Accept all trades whole or in part payment of vehicle.
At no time did the vehicle owners agree to transfer the ownership of their vehicles to TREADZ.
Seventy-eight of these vehicles were allegedly sold to unsuspecting buyers who legally purchased the vehicles from TREADZ. It is alleged that TREADZ failed to compensate the original owner for the vehicle sale, and in some cases also failed to pay off the liens associated to that vehicle. The losses from these vehicles are estimated at approximately $1.8 million.
Between October 1, 2013, and August 31, 2014, TREADZ is also alleged to have re-registered 62 vehicles in the company’s name by using fraudulent ownership documents. In some instances, registration documents were completely fabricated. The company then used 38 of these vehicles as collateral to acquire a loan from a credit company for approximately $484,000, which was allegedly never repaid. TREADZ then sold some of these vehicles to unsuspecting third parties, leaving consigners at risk of paying the debt to the credit company or third party buyers at risk of having their vehicle seized.
The credit company was able to recover 27 of these vehicles under the Fair Trading Act, however, rather than leaving citizens at a loss, the company accepted the financial loss and returned the vehicles back to the owners.
The total loss accumulated by vehicle owners and the credit company is estimated at over $2.2 million.
Sean Patrick O’BRIEN, 47, of Calgary, has been charged with 89 counts of fraud over $5,000, 71 counts of theft over $5,000, and one global charge each of trafficking in property obtained by crime, using a forged document, counterfeiting a mark and fraud over $5,000.
O’BRIEN will next appear in court on Friday, July 15, 2016.
CPS would like to thank Service Alberta for their assistance in this investigation and the victims for their cooperation and patience.
Case #: 15246451/3415