Washington’s Largest Used Car Dealership Pleads Guilty To Financial Reporting Crimes
Agrees to forfeit $1.5 million seized from bank accounts and pay $250,000 fine
SEATTLE - The largest volume used car dealership in Washington, pleaded guilty and was sentenced today in U.S. District Court in Seattle for failure to file a monetary transaction report. Zein Automobiles, Inc., d/b/a Independence Auto Sales and Best Bet Auto Sales with locations in Lynnwood and Everett, forfeited $1.5 million to the United States, paid a $250,000 fine and entered into a corporate integrity agreement to ensure the illegal conduct does not happen again. The investigation was led by the Drug Enforcement (DEA).
In the plea agreement the corporation admits that between January 2010 and September 2013, its employees and agents entered into cash sales of vehicles in excess of $10,000 and failed to report the cash sales to the IRS. In a search warrant affidavit describing the investigation, DEA undercover agents and confidential sources purchased vehicles for cash at the two dealerships. Posing as drug traffickers, the undercover DEA agents told sales people they did not want the cash transactions reported. The undercover DEA agents were very clear that they wanted the vehicles for drug trafficking purposes. The sales people assured the agents that they were familiar and comfortable with such transactions and proposed various schemes that they said would avoid the cash transactions reporting requirements. Such schemes are illegal. On September 11, 2013, federal search warrants were executed at the automobile dealerships.
Under the terms of the corporate integrity agreement, the company is required to keep a log and report every cash transaction in excess of $10,000. Both the sales managers and title clerks are required to ensure the reports are made to the IRS. During a two year probationary period, the company is subject to unannounced audits to ensure such reports are being made. The company has also agreed to publicize its guilty plea, penalties, and compliance plan in formats to be approved by U.S. Probation.
The case was investigated by the Drug Enforcement (DEA), the Internal Revenue Service Criminal (IRS-CI), the Seattle Police Department and the King County Sheriff’s Office.
