Serra Nissan Financial Fraud Class Action Lawsuit

Cory Watson Attorneys has filed a class action lawsuit to help automobile buyers injured by fraudulent loan practices at Serra Nissan. The law firm is representing individual plaintiffs and all other consumers who have purchased cars at Serra Nissan and been affected by the dealership’s fraudulent funding and sales practices. Injured plaintiffs may be entitled to financial compensation for the damages that they have suffered.

The class action lawsuit is related to cases in which former Serra Nissan managers and employees were convicted on criminal charges stemming from the fraud. Attorney F. Jerome Tapley explains why the Alabama class action law firm of Cory Watson Attorneys filed the suit:

“The complaint seeks justice for the consumers who were harmed by the crimes committed at Serra Nissan and Serra VW. The complaint alleges that Serra Nissan and Serra VW are not merely car dealerships–Serra employees perpetrated a pervasive scheme to defraud customers, and in doing so formed an enterprise engaged in organized crime. The lawsuit seeks to recover on behalf of all consumers who were injured by the criminal enterprise.”

If you purchased a car at Serra Nissan, Serra Oldsmobile, or Serra Volkswagen, contact Cory Watson Attorneys to see if you can join the lawsuit. Call (877) 562-0000 or fill out our online form for a free, no-obligation consultation. We are helping victims fight back against fraud.

Download the Serra Nissan Class Action Lawsuit

Click here to download a copy of the Serra Nissan class action lawsuit.

Confidential Informant Alerts FBI

In what federal authorities are calling a calculated move to fraudulently boost loan approvals and car sales at the Birmingham dealership, eight former Serra Nissan employees have pled guilty in a scheme to falsify loan documents to qualify innocent customers for loans they could not afford.

Defendants falsified, without the knowledge and participation of the customer, customer income and employment information on loan applications submitted to banks and lending institutions. As a result of the fraud, defendants profited from increased sales and commissions, and the lending institutions and customers were stuck with cars and loans they could not repay.

The guilty pleas include charges of conspiracy, bank fraud, wire fraud and aggravated identity theft. The maximum penalty for conspiracy is five years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1,000,000 fine.

Agents with the Federal Bureau of Investigation (FBI) say the conspiracy to defraud financial institutions, Nissan North America and Serra Nissan customers took place between August 2010 and October 2013.

According to an FBI affidavit, a confidential informant who had previously worked at Serra Nissan came to the FBI in March 2013. This informant “provided multiple volunteered audio recordings regarding the loan fraud, documented proof of the loan fraud, and miscellaneous documentation he acquired during his employment at Serra Nissan.”

Launch of Federal Grand Jury Investigation

As a result of the tipster, a federal grand jury investigation involving Serra Nissan was launched in April 2013. During this time, the dealership was “under investigation for fraudulently falsifying customers’ loan documents and submitting the fraudulent information to various financial institutions to obtain auto financing.”

According to AL.com, falsified loan documents included, but were not limited to:

  • “Fluffing” – also known as inflating the income of prospective car buyers.
  • Creating or altering documents to submit to financial institutions.
  • Listing accessories not actually included on a vehicle so a financial institution would increase loan amounts.
  • Presenting buyers who could qualify for a loan, when the actual buyer could not (also known as ‘straw buyers’).

The undercover federal probe also uncovered multiple cases where customers and financial institutions were quoted an inflated monthly vehicle payment so that a finance manager could add a warranty and gap insurance without consumers being aware of what was happening.

According to a Special Agent with the FBI, this case is significant not only because of loss amounts, but because of the many victims who trusted the financing of their vehicles to the defendants.

Authorities say these fraudulent tactics – loans being given to people who don’t qualify and really can’t afford them – are the same type of predatory factors that trigged the mortgage collapse of 2008.

It’s a sentiment echoed by U.S. Attorney Joyce Vance. “Predatory practices in providing auto loans to people with credit problems or insufficient income is akin to the fraud in mortgage lending. We are engaged in rooting out this fraudulent activity that threatens consumer safety.”

Serra Nissan maintains it began its own investigation after being alerted about allegations of possible fraud in 2013. The company says from the onset it has cooperated with authorities and says the guilty pleas by the former employees are not a reflection the company, its values or employees “who strive to conduct business with honesty and honor.”

All eight defendants have pled guilty to conspiracy. The former Serra Nissan employees include three sales managers, two finance managers and three salesmen. Additional criminal charges against the sales managers and finance managers include bank fraud, filing a false federal income tax return and failure to file an individual tax return.

Sentencing Hearings Scheduled through July 2015

On May 28, 2015, the Associated Press reported that a federal judge sentenced former Serra Nissan General Sales Manager Abdul Islam Mughal to two and a half years in prison on two counts of fraud. Mughal pled guilty to the fraud charges in the scheme that involved falsifying documents that allowed customers who did not qualify for a loan to get a loan. The scheme elevated to bank fraud when the phony documents were presented to banks and other lenders.

Additional sentencing hearings are scheduled through July 2015 for the remaining defendants, and a restitution hearing is set for July 2. Restitution will be based on the amount of losses banks incurred as a result of the fraud.

This isn’t an isolated case. As the New York Times brought to light via AL.com, just last year, hundreds of fraudulent loans worth millions of dollars were found by federal authorities at other dealerships around the nation.

With over $102 million recovered in consumer class actions alone – Cory Watson Attorneys are known as the ‘go-to’ firm representing consumers and their families for more than 30 years. If you have a legal question about the auto loan fraud conspiracy at Serra Nissan contact Cory Watson Attorneys today.

Fill out free case review form or call (877) 562-0000 today for help from our experienced team of Alabama class action attorneys.

This law firm is not associated with, sponsored by, or affiliated with Serra Nissan or the fraud investigation.