Despite the Court of Appeal’s surprise in having to deal with this “obscure little backwater area of the law” — to quote the Court — , practitioners know that the fact pattern of which the defendants were convicted is not that unusual. In People v. Ali Maadarani, 2016 WL 5940319, at *13 (Cal.App. 3 Dist., 2016), the Court of Appeal found that multiple counts of grand theft auto should be reduced to a single count. The facts arose out of the defendant’s scheme to undervalue expensive luxury vehicles under California’s lien sale statutes in order to wash the secured creditor’s lien.
The following evidence was presented at the jury trial with respect to each vehicle.
The Ford F-150 Pickup Truck
In 2010 Samuel Jones decided he could no longer afford the monthly payments on his 2005 Ford F-150 pickup truck. Jones went to the Auto Max dealership to purchase a different vehicle. Hamze “Tony” Maadarani, a cousin of Ali and Amin, owned the Auto Max dealership. Jones drove the Ford to Auto Max, parked it, and purchased another vehicle. Jones left the Ford at the dealership, giving Tony the one key he had and planning to return in a couple of days to pick up the Ford and return it to the bank that had made the loan. Tony told Jones he might have to move the Ford from the back of the parking lot and “park it on the lot or on the street right in front of the car lot.” Tony called Jones the next day and asked him to send proof of his insurance on the new car. Tony also told Jones he might have found a buyer willing to take on the loan on the Ford. Jones later stopped by Auto Max and dropped off the remaining loan payment slips for the Ford. He left the documents with a young man he assumed was an Auto Max employee. Jones had no further contact with Tony and never saw the Ford again. Alejandro Banderas, an Auto Max salesman at the time, worked under Tony’s supervision. Banderas remembered a customer bringing the Ford to Auto Max to trade in for another car. About two weeks later, Tony allowed Banderas’s mother, Carmen Cervantes, to borrow the Ford. Cervantes drove the Ford for three weeks. At one point a thief broke one of the Ford’s windows and stole a purse that had been left in the vehicle. Except for the broken window, the Ford was in perfect working condition. Tony called Cervantes and requested that she return the Ford to Auto Max. Her son, Banderas, drove the Ford to the dealership and gave Tony the key. According to Tony, Jones had been a customer in 2010, but Tony had no idea the Ford belonged to Jones. Tony denied speaking to Jones about the Ford or receiving the truck’s key. After selling Jones the new car, Tony never saw Jones or the Ford again. He did not give the Ford to either Ali or Amin. Ali Mohammad Maadarani (Ali Mohammad), defendants’ cousin, saw the Ford F-150 parked on the street in front of Tony’s Auto Max car dealership. The Ford appeared in good condition and was not stripped. He later saw the Ford parked at M3 Motors. In October 2010 Teter received an application from M3 Motors for a lien sale of a Ford F-150. Ali owned M3 Motors, and every transaction had to be approved by Amin. The application listed Jones as the registered owner. Teter spoke with Nahed Brakat, an M3 Motors representative, about the Ford’s condition. Brakat told Teter the Ford had been stripped and abandoned on Brakat’s property. Because a 2005 Ford F-150 could be worth over $4,000, Teter included a statement with the application noting the vehicle had been stripped. Sierra Central Credit Union (Sierra Central) handled the lien on Jones’s Ford F-150. In 2010 Sierra Central attempted to locate and repossess the Ford. After these efforts failed, a Sierra Central repossession specialist recommended a “charge-off” on the Ford. When the credit union has been unable to locate a vehicle for more than 90 days, it charges off the vehicle for tax purposes but retains legal ownership. Sierra Central received a notice for a proposed lien sale of the Ford. The notice indicated the Ford had been picked up a few months earlier, and M3 Motors was requesting reimbursement for storage fees for the Ford from Sierra Central. Sierra Central’s repossession specialist contacted M3 Motors in an effort to determine why Sierra Central had not been notified immediately when M3 Motors recovered the Ford. A man who identified himself as Alex stated a third party had ordered the Ford be picked up. According to Alex, the Ford was missing its motor, side window, and passenger seat. The exterior was scratched and the upholstery torn. Sierra Central sent an investigator to inspect and photograph the Ford. The investigator found the Ford was not missing its motor or passenger seat. Sierra Central notified the DMV and the district attorney. DMV investigator Eric Cook spoke to Ron Teter at the I-Lien office in October 2010. While at the office, Cook and a fellow investigator, Dan Cawley, overheard a telephone conversation between Teter and a customer requesting lien documents for the Ford. Teter gave the investigators the lien documents. The next day, Cook and Cawley went to M3 Motors to inspect the Ford. They arrived before the business was open and found the parking lot gate open. They found the Ford parked on the lot and identified it through its VIN number. The Ford had not been stripped. However, there was a tear in the driver’s seat, a broken side window, and a damaged side mirror. Aside from these damages, the vehicle appeared to be “in great condition.” The Ford’s motor, transmission, and seats were intact. Cook later spoke with Brakat, who stated Ali directed him to tell Teter the Ford had been stripped and then abandoned at M3 Motors. After Cook and Cawley examined the Ford, Ali arrived at M3 Motors and spoke with the investigators. Ali confirmed that the Ford parked on the lot was the same vehicle described in the lien sale documents. He could not produce any documentation supporting the sale. In response to Cawley’s questioning about the Ford’s provenance, Ali stated the truck had been left at the dealership two months earlier with the key in the ignition and a broken side window. Ali moved the vehicle to the back parking lot and filed the lien documents two months later. Crawley questioned the $180 towing fee listed on the lien document, and Ali stated he believed his moving the Ford to the back lot constituted a towing. During a second interview later the same day, Ali stated he believed the broken passenger window, ripped seat, and the missing portion of the grille amounted to a stripping of the Ford. Ali admitted that he failed to inform the police about the stripped Ford and did not attempt to contact the Ford’s owner. An M3 Motors salesperson, Arthur Clark, who worked for the company in 2010 under Ali’s direction, remembered seeing Ali drive the Ford onto the lot at M3 Motors. When he asked Ali about selling the Ford, Ali said the truck was not for sale. Instead of selling the Ford, they “were going to keep it to use it to tow parts.” After Clark spoke to the DMV investigators he ended his employment with M3 Motors. He later went to the dealership to pick up a friend who was an employee. Ali, Amin, and their brother Ahmad approached Clark. Ali said he had heard Clark was talking to the DMV and asked Clark if he was wearing a wire. Ahmad patted down Clark, searching for a wire. As Clark left, Ali told him to keep his “mouth shut” and not speak with the DMV investigators.
The BMW
In August 2010 Ronald Teter processed a lien sale application from M3 Motors for a 2005 BMW 330i. Brakat, who was the finance manager of M3 Motors in 2010, filled out the lien sales application for the BMW. Brakat never saw the BMW but circled the words “all-over strip” on the application. Nor did Brakat know the registered owner of the BMW was Amin’s wife. The provenance of the BMW is not entirely clear.
Jason Osiow, a mechanic employed by M3 Motors, saw the BMW parked at the dealership at the beginning of his employment. The BMW was shielded with a protective cover and parked in a service bay, where it remained for a couple of months. A few months after Osiow began working at M3 Motors, Amin started driving the BMW to and from work. Naji Bsharah, the owner of Fulton Auto Mall, a used-car dealership, had a business relationship with Amin. From 2004 to 2007 Amin operated Amin’s Auto Sales. In 2006 the BMW, which had been stored at Amin’s Auto Sales, was sold wholesale to Fulton Auto Mall. Fulton Auto Mall then sold the BMW to Amin’s sister-in-law, Badera Maadarani, and his sister, Susan Maadarani, as cobuyer. Bsharah denied any involvement in the later lien sale of the BMW. Ali Mohammad was also in the car business. He worked at Amin’s Auto Sales in 2006. Ali Mohammad saw the BMW for sale at Amin’s Auto Sales in 2006. He described the BMW as “in really good condition, almost like new.” The BMW was still for sale when he stopped working for the dealership in December 2006. In 2008 Ali Mohammad saw the BMW parked in Amin’s driveway. It was still in good condition. Ali Mohammad next saw the BMW for sale at Certified Auto Sales; it was still in good condition. About 18 months later, Ali Mohammad saw the BMW parked behind M3 Motors in an area separate from the sales lot. Two weeks later, he saw the BMW in the M3 Motors garage, missing its taillights. Ali Mohammad observed Amin driving the BMW on eight to ten occasions. Amin regularly drove the BMW to other dealerships and to his home. SAFE Credit Union (SAFE) handled the lien sale on the BMW; Karen Higgins, a senior collection specialist, was in charge. A loan in the amount of $39,005.75 had been issued in 2008 to purchase the BMW. Only one payment was made on the loan. SAFE could not reach the debtor or repossess the vehicle and ultimately charged off the loan for tax purposes. SAFE retained title to the BMW. In 2010 SAFE received a lien sale notice for the BMW, and Higgins contacted M3 Motors to ascertain the car’s condition and location. The person who answered the phone indicated the BMW had been stripped and had accrued a storage fee of over $3,000. Based on this information, SAFE decided not to contest the lien sale of the BMW. The information provided to SAFE was false. Mark Guess, employed by the Bureau of Automotive Repair, investigated vehicles involved in fraud and unfair business practice claims in the auto repair business. At trial, he testified as an expert on automotive collision repair. In December 2010 Guess received a request from Cawley and Cook to inspect the BMW. The investigators asked Guess to determine whether the BMW had been “stripped of its components.” Guess found no evidence that the BMW had been stripped. The BMW’s interior was intact. Guess’s inspection revealed no markings indicating the doors, seats, trunk lid, or hood had been removed. There was no evidence that any of the BMW’s components had been removed or replaced. Similarly, another investigator for the Bureau of Automotive Repair, Brian Cole, inspected the BMW to determine whether the vehicle had been stripped. He found no indication that any of the BMW’s components had been removed or disassembled and concluded the BMW had not been stripped. DMV investigator Cawley conducted a business inspection of M3 Motors. During the inspection, Cawley asked Ali about the BMW. Ali stated the BMW’s owner was Susan Maadarani. Since she could not afford the monthly payments, Ali brought the BMW to the dealership to “get ownership documents” for the vehicle. Subsequently, Cawley removed the BMW’s dealer sales jacket, which contains all of the ownership documents for a vehicle, including documents regarding how the vehicle was obtained and the certificate of title signed by the lender. The outside of the jacket identified the BMW by make, model, and VIN number. The jacket contained no documents. Cawley asked Ali for any receipts or invoices; Ali could not produce any such documentation.
The Hummer
Amin and Ali rented a garage from Consignment Auto Sales, a dealership owned by Mahir Omary. They also used Omary’s dealership as a business through which they could consign vehicles. The Hummer and the Mercedes, later to be the subject of lien sales, were stored in Omary’s garage. Amin’s Auto Sales acquired the Hummer through a customer trade-in. Bsharah last saw the Hummer on the Amin’s Auto Sales lot in the middle of 2007. According to Omary, the Hummer was “running fine” when Ali and Amin brought it to the garage at Consignment Auto Sales. Omary borrowed the Hummer and did not notice any mechanical problems. Later, Amin asked Omary to conduct a lien sale of the Hummer, but Omary refused. Although a lien sale application filed for the Hummer listed Consignment Auto Sales as the seller, Omary never drafted or filed the application. Omary learned of the application when he received a phone call from an individual desiring to purchase the Hummer. Omary called I-Lien, which had submitted the lien sale application. He also spoke with DMV investigators about the application and filed a police report stating someone had unlawfully used Consignment Auto Sales’s name to conduct a lien sale. Ali supervised Osiow, the mechanic at M3 Motors, and Amin frequently stopped by the dealership. When Osiow began working at M3 Motors in 2010, the Hummer, already dismantled, was stored in the mechanic’s shop. The hood and some of the doors were removed, and pieces of the interior were missing. It appeared to have been recently painted. Amin purchased replacement parts for the Hummer, and Osiow worked with him to reassemble it. After the Hummer was repaired, Osiow backed the vehicle out of the garage. Amin never told him where the Hummer had come from or who owned it. Ali Mohammad first observed the Hummer for sale at Amin’s Auto Sales. He saw Amin driving the Hummer, both with and without advertising material on the vehicle. The Hummer remained on the lot until the dealership closed in 2007. Two years later, Ali Mohammad saw Ahmad driving the Hummer. The Hummer was often parked at Ahmad’s house, and Ali Mohammad saw it once in Amin’s driveway. Ali Mohammad later observed the Hummer parked in the garage of Consignment Auto Sales. It did not appear damaged in any way. In 2010 Ali Mohammad saw the Hummer parked at M3 Motors. The front end was removed, and according to Ali Mohammad, “the grille, the grille support lights, all the headlights, the sides, pretty much all that was stripped. The lights, everything in the front was gone. Even the hood was off. All you could see was the apron and chassis.” Ali Mohammad asked Amin about the registration on the Hummer. Amin told Ali Mohammad he had a company that handled liens. Ally Financial, a vehicle loan company, handled the account of Gurgen Arutyunyan, who had received a loan to purchase a 2004 Hummer. By April 2010 Arutyunyan had defaulted on the loan. Ally Financial attempted to repossess the Hummer. Ally Financial received a lien sale notice on the Hummer that listed Consignment Auto Sales as being in possession of the vehicle. An Ally Financial impound coordinator spoke to someone at Consignment Auto Sales who said the Hummer had been stripped down to its chassis. The unidentified person also stated the towing and storage fees were about $5,000, an amount which differed from that listed on the lien sale notice. Based on the description given of the Hummer’s condition and the storage fees, Ally Financial decided not to contest the lien sale. Mark Guess from the Bureau of Automotive Repair received a request in December 2010 from Cawley and Cook to inspect the Hummer. The investigators asked Guess to determine whether the Hummer had been burned out and stripped. Guess found no evidence that the Hummer had been stripped. The paint was intact and the suspension was in place, with no indication that it had been removed. The Hummer’s interior was not damaged, nor did it appear that the interior panels had been replaced. The Hummer’s doors were intact, although there was evidence the left front and left rear doors had been removed at some point. Guess’s inspection revealed the Hummer had never been stripped down to its chassis. Brian Cole, the automotive expert who testified regarding the BMW, also inspected the Hummer to determine whether it had been stripped. Cole found no evidence the Hummer had been stripped or disassembled. The Hummer’s undercarriage, engine, and suspension were intact. Cole did note that several bolts were missing from the Hummer’s skid plates, doors, and cross-members and that these parts had been removed and reinstalled. Arthur Clark, the M3 Motors salesperson who had provided information to the DMV investigators regarding the Ford F-150 truck, also remembered seeing the Hummer on the lot. Although he tried to sell the Hummer, Clark found no buyers. One day Ali told Clark he was expecting delivery of paperwork on the Hummer. When Clark received the documents, which included a notice of lien sale for the Hummer, he brought them to Ali. Ali said, “I’ve been waiting for those papers.” Ali than told Clark that these were “the lienholder papers that he was waiting on so that way [we] can re-get the car.” As detailed earlier, after speaking to the DMV investigators, Clark ended his employment with M3 Motors. Thereafter he went to the dealership to pick up a friend who was an employee. Ali, Amin, and Ahmad approached Clark. Ali said he had heard Clark was talking to the DMV and asked him if he was wearing a wire. Ahmad patted down Clark, searching for a wire. As Clark left, Ali told him to keep his “mouth shut” and not speak with the DMV investigators.
The Mercedes
As noted earlier, Amin and Ali rented a garage from Consignment Auto Sales, a dealership owned by Mahir Omary, where they stored the Hummer and the Mercedes. Omary remembered the Mercedes that Amin stored on the property. The Mercedes had not been stripped or broken up into separate parts. However, the lien sale application for the Mercedes, an application that also included the Hummer, indicated the Mercedes was an “all-over strip.” Because it was more than five years old, DMV presumed a value of under $4,000, avoiding the need for DMV approval for the sale.. The parties stipulated to the testimony of Susan Scammon that she was the recovery manager for SAFE and SAFE provided the loan for the Mercedes; that the loan became delinquent on March 22, 2007; and that CUNA Mutual Group, the loan insurer, paid an insurance claim in the amount of $23,150.71 and took title to the Mercedes. The parties also stipulated that a DMV licensing registration examiner would have testified that in doing the registration verification he did not note any major damage to or any large missing components from the Mercedes.
Thus, however, the Court concluded that the four transactions constituted a single count. “Here, defendants’ convictions revolve around four vehicles, involving separate transactions and financial institutions. As in Whitmer, “Under the law that has existed for decades, defendant could only have been convicted of a single count of grand theft.” (Id. at p. 735.) In light of Whitmer, and the facts surrounding defendants’ crimes, their convictions should be reduced to a single conviction for grand theft”.