PatchSCOTTSBLUFF, Neb. — Three Scottsbluff auto dealership executives are expected to be under arrest by this morning after they packed up their belongings, loaded 81 new vehicles onto trucks and left town.
Scottsbluff police, with help from federal authorities, tracked the trio across the southwestern United States on Wednesday as many of the vehicles were sold at auctions.
Felony theft charges were filed in Scotts Bluff County Court on Wednesday against Legacy Auto Sales owner Allen Patch and two of his senior managers: comptroller Rachel Fait, 37, and general manager Rick Covello, 53.
Detectives located Patch, 52, at his attorney's office in Tooele County, Utah, and were waiting to arrest him. Scottsbluff Police Capt. Kevin Spencer said he had not been arrested as of 8:30 p.m. CDT.
Fait was arrested in Tooele County earlier Wednesday. Covello is expected to turn himself in to Scottsbluff authorities today.
According to police, 81 new Ford and Toyota vehicles were loaded onto auto transport trailers from the dealership over the weekend and Monday evening. Scotts Bluff Deputy County Attorney John Childress said the vehicles, among them sedans to pickups, are valued at more than $2.5 million.
According to court documents, plans to title and sell the vehicles at auto auctions were in the works for weeks.
A Utah company, Rausch Transports, told police that Fait contacted them last week, saying she needed cars taken to auctions in Las Vegas and Salt Lake City.
According to police, dealership employees converted manufacturer documents to ownership titles at the Scotts Bluff County Clerk's Office on Feb. 26 and 27 and then Thursday, Friday and Monday.
It is not unusual for a car dealership to obtain vehicle titles, Spencer said, but in this case, "the cars weren't theirs to sell because they were owned by a Toyota financing company."
A dealership sales manager not involved in the case said that with the titles, a dealer can sell vehicles for cash at an auto auction.
The thefts appear to have been motivated by Patch's financial difficulties, according to Spencer. Platte Valley Bank had been overseeing the dealership's daily operations for about three months.
According to an arrest affidavit, two employees told police that Fait was suspected of embezzling money from the company. One said Fait had taken more than $46,000 from the business and kept a large backpack filled with cash.
Authorities had tracked down at least 36 vehicles, including 16 sold at a Salt Lake City auction and seven recovered from a Salt Lake City dealership. Vehicles were also found in Las Vegas, but that number was not available. Police found seven vehicles parked at the Western Nebraska Regional Airport in Scottsbluff.
Rob Brasher, owner of Brashers Salt Lake Auto Auction in Utah, confirmed that some of the stolen vehicles had been sold at his business. He declined to comment further, saying he needed to talk to a lawyer because he was trying to work out issues with Toyota.
Doug Bergener, a manager at Bargain Buggys in Tooele, Utah, a suburb of Salt Lake City, said he and his partner have known Patch and Fait for nearly 20 years.
Bergener said he heard recently that Patch and Fait were shutting down the Scottsbluff dealership, and he offered to buy 10 used vehicles.
The vehicles arrived at the Manheim Utah Auto Auction in Woods Cross, Utah, aboard an auto transport truck Monday morning.
But they weren't used cars. They were 2009 Toyotas. Corollas. Matrixes. Yarises. Tacomas.
"All new — brand new," Bergener said.
Following standard procedure, Bergener financed the vehicles through the auto auction and had 90 days to sell them on his lot before they went back to the auction.
By Tuesday, Bergener had sales pending on four of the vehicles. Then he got a call telling him not to sell them because the vehicles were stolen.
Bergener said Patch told him that he paid for the vehicles and had titles for them.
"I don't think anyone can prove anything's illegal at this point," Bergener said. "We've know Allen for 15 years and never knew him to do anything underhanded. There's been no reason not to trust him. He's always been honest. It'll all come out in the wash."
Police said they were confident they would be able to track down most of the vehicles. Spencer said transport companies must register with ports of authority when entering states and are required to carry a bill of lading, a document issued by the carrier acknowledging that the goods have been received.
According to the arrest affidavit, Joseph Carlson, a representative of Toyota Financial Services based in Overland Park, Kan., told police that Toyota owned all the cars, having lent the dealership "millions of dollars in operating expenses." Carlson told police there was no reason to convert car documents to ownership titles except to "convert them (the vehicles) to cash."
Childress, the deputy county attorney, said the transportation company based in Utah appears to have been another victim and was not knowingly involved. He said the company had been paid with a fraudulent cashier's check. An arrest affidavit said the company had been paid $18,000 and had been cooperating in locating the vehicles.
Miranda Cervantes, an employee at Legacy Auto Sales, said employees arrived Tuesday morning and found most of the cars missing from the lot. The desks used by Patch, Fait and Covello had been emptied, and their computers had been taken.
Police found similar circumstances at the trio's homes. Spencer said police went to the home of Fait and a home shared by Patch and Covello. It appeared that most of their belongings had been removed, Spencer said, and both homes were posted for sale.
Toyota representatives were at the dealership Wednesday, conducting an inventory of vehicles. An official from the Nebraska Motor Vehicle Licensing Industry Board, which regulates vehicle registrations and personnel, arrived late Wednesday morning.
The business remained open and was being overseen by Platte Valley Bank.
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