Auto dealer closed with unfinished customer business

July 21, 2010 9:33:31 AM PDT
California state authorities have forced the closure of a used car dealership for failure to pay state taxes. But, still left unanswered is what's going to happen to customers who feel cheated by the same dealership.

The closure of the dealership certainly complicates things for consumers with unfinished business, but that's not stopping them from fighting to make what they feel is a wrong into a right.

Onesha Oliver's life has spun out of control ever since she purchased her Monte Carlo.

"It's nice looking on the outside, but overall it's a very horrible car," she says.

Shirley Jones bought a Pontiac Grand Prix, but police confiscated the car six months later for something she blames on the car dealer.

"You know, I saved up money to put down for this car and I feel horrible," she says.

Both purchased their cars from Elite Auto in Pittsburg. Both times, Elite Auto failed to transfer ownership of the vehicles within the 30 days required by the state. Onesha has been waiting for six months.

"The car is registered to the previous owner. I went down to the Department of Motor Vehicles and I was unable to get any type of paperwork because the dealer has not submitted anything that says they sold me this car," she says.

Shirley bought her car in March 2009. The DMV confirms that police towed the car six months later because the registration had expired.

"I feel like Elite Auto has just ruined my life," she says. "I feel like my life is totally ruined."

Shirley went to the Auto Return tow yard to get back her car, but Auto Return refused to give it to her because she had no proof of ownership. She currently has no car.

"I actually just feel, you know, really alone, because I feel actually less than a mom," she says. "I can't even help my children get to where they need to get to."

7 On Your Side went to Elite Auto looking for answers. The dealership denies it's doing anything wrong.

"No. The cars are properly registered. The complaints you have is because of repossession stuff, has nothing to do with anything else," says Elite Auto sales manager Richard Barekzia.

Barekzia says Shirley stopped making her payments. She showed 7 On Your Side $2,600 worth of receipts and says she only stopped paying when Elite didn't transfer the ownership.

"Numerous times I talked to the DMV and I talked to the dealership, and I asked them if they could mail over anything or send over anything to the DMV so I could retrieve the car and ownership, and nothing happened," Shirley says.

Auto Return eventually sold Shirley's car in a lien sale on January 6. DMV records show that five days later, Elite Auto did finally transfer ownership to Shirley. But, it was too late, the car had already been sold to someone else.

The DMV says it continues to investigate Elite Auto and is encouraging customers to contact them if they have complaints. Elite Auto has also been stripped of its license by the secretary of state, Board of Equalization, and the DMV, for failure to pay taxes.

Barekzia says owner Monty Slaven is a victim of hard times.

"They're closed, basically, like a lot of people, just like the same reason as this one," he says. "He lent a lot of money and nobody's paying him, so he ran out of money basically."

Shirley took Elite Auto to small claims court in April and won a $5,000 judgment. She is still waiting for the dealership to pay her. Onesha is working with an attorney and says she will sue Elite if necessary.

More Information:

Question: What prevented or is preventing the DMV from working with the complainants and get them the title and registration in a timely matter, especially since they've been able to produce receipts and contracts substantiating their purchase?

DMV Answer: If a dealer fails to transfer a vehicle (as prescribed by VC 5753 pursuant to VC 4456) the consumer may file a complaint with DMV Investigations Division. The consumer should notify the DMV as soon as possible so the Investigations Division (INV) may investigate the potential violation(s) of law. As part of the investigation, INV would collect the consumer's vehicle sales contract and any proof of good faith purchase (receipts/bills of sale) and contact the dealer with regard to the alleged violation. In this process, INV under normal circumstances forwards the consumer's documentation to the appropriate DMV Registration Operations Division so that the consumer may receive appropriate registration. If the dealer is out of business, INV would provide the consumer with a "Dealer out of business" letter and outline of documents (sales contract/bills of sale/receipts) which the consumer should personally forward to a local DMV office to begin the registration and titling process. If the dealer failed to remit registration fees and or sales tax, the consumer may have to submit payment to DMV. If the consumer is harmed and remits payment again to the DMV, the consumer has civil recourse as well as the ability to file the following claims:

  • If the consumer has to submit registration or sales tax to DMV, which would have been a dealer obligation, the consumer can attempt to recover their losses through a claim against the dealer's bond. In order to obtain a dealer's license, the dealer posted a Surety Bond with DMV. It is recommended the consumer contact DMV at www.dmv.ca.gov or call 1-800-777-0133 for assistance in obtaining dealer bond information.
  • Questions regarding any claim against this Surety Bond should be directed to that bond company.
  • The consumer can also file a claim with the Consumer Motor Vehicle Recovery Fund. The Consumer Motor Vehicle Recovery Fund has been established to assist consumers who have suffered a monetary loss as a result of a California motor vehicle dealer or lessor-retailer that has gone out of business. Information is available on the DMV website at www.dmv.ca.gov.
As of May 26, 2010, Elite Auto's license was invalidated due to BOE revocation of sellers permit and has been officially out of business. DMV INV has responded to consumer complaints and consumers have been assisted with their registration and titling needs.

It should be kept under consideration that each consumer(s) complaint must be reviewed and each may have more complex circumstances. DMV is unable to go into detail regarding specific complaints involving Elite Auto and/or the active investigation.


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