Former Shoreline Mitsubishi Employee Sentenced for Role in Credit Fraud Scheme
Topics: Shoreline Mitsubishi, Jose Espinosa
U.S. Attorney’s Office, District of Connecticut
September 23, 2009
Nora R. Dannehy, United States Attorney for the District of Connecticut, announced that JOSE ESPINOSA, 40, of Manchester, a former employee of Shoreline Mitsubishi in Branford, was sentenced today by Senior United States District Judge Ellen Bree Burns in New Haven to three years of probation for his involvement in an extensive fraud scheme related to the submission of false auto financing credit applications. Judge Burns also ordered PIERRO to pay a fine in the amount of $3500. On December 11, 2003, ESPINOSA pleaded guilty to one count of conspiracy to commit wire fraud.
According to statements made in court and evidence disclosed during the trial of four other former employees of Shoreline Mitsubishi, ESPINOSA and others participated in a scheme whereby they submitted false customer credit information via fax, the Internet, and the mails to Mitsubishi Motors Credit of America, Inc. (“MMCA”). Specifically, Shoreline Mitsubishi employees inflated customers’ income figures and falsified other material information before submitting customer credit applications to MMCA. Shoreline Mitsubishi employees submitted these false credit applications to MMCA in order to deceive MMCA concerning the customers’ income and other material information, and thereby to induce MMCA to approve the extension of credit to customers of Shoreline Mitsubishi who would not have qualified for automobile financing at all, or for the amounts approved by MMCA, had such fraudulent information not been provided to MMCA.
The evidence at trial proved that, on many of the transactions, Shoreline Mitsubishi employees failed to disclose to customers the existence of large “balloon payments” at the conclusion of their financing contracts. In addition, in some instances, Shoreline Mitsubishi customers were being charged a substantially higher price for the automobiles than the customers had agreed to pay. In other instances, customers were being charged for insurance contracts and extended service warranties that they had not requested or that they had been told were being included in their contract free of charge. In many instances, Shoreline Mitsubishi customers were charged for optional items, such as CD changers, that were not actually installed in their cars. Finally, the investigation revealed that some Shoreline Mitsubishi employees pocketed cash down payments that had been provided to the dealership by customers.
ESPINOSA was hired at Shoreline Mitsubishi in the Spring of 2001 and was employed at the dealership, primarily as a salesperson, for approximately 18 months. On a few occasions, ESPINOSA personally inflated his customers’ incomes and/or lowered their housing costs on their credit applications. In other instances, he truthfully reported the customers’ information to the sales desk with the knowledge and expectation that someone at the sales desk would alter that information before it was transmitted to MMCA.
For the purpose of sentencing the defendants in this matter, the Court has determined that MMCA has suffered a loss of $2.1 million as a result of this fraud scheme.
Shoreline Mitsubishi went out of business in 2003.
This matter was investigated by the Federal Bureau of Investigation, the United States Secret Service and the Branford Police Department. The Connecticut State Police, the Connecticut Department of Motor Vehicles, and the Guilford Police Department also provided assistance in this case. This case is being prosecuted by Assistant United States Attorneys Michael S. McGarry and Jonathan Biran.
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