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Author Topic:   Calif State: 90% of hot rods illegally registered
Jim C
Prowler Junkie

Posts: 537
From: Corona, Ca
Registered: JUL 2004

posted 10-21-2004 12:18 PM     Click Here to See the Profile for Jim C     
State: 90% of hot rods illegally registered
As quoted from Orange County Register Wed News...


INDUSTRY PROBE: Boyd Coddington’s La Habra workshop was the site of an Oct. 6 search as part of a multi-agency investigation into theillegal titling of custom-built cars. The investigation is continuing, and Coddington has not been charged.
Paul E. Rodriguez, The Orange County Register
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RELATED STORIES
•Bill of sale lets a company obtain an out-of-state title


By GWENDOLYN DRISCOLL
THE ORANGE COUNTY REGISTER

Up to 90 percent of the hot rods and other custom-built cars on California roads are illegally registered and might have cost the state an estimated $250 million in lost revenue over the past decade, the state Attorney General's Office said Tuesday.

Seventy-thousand custom-built cars are estimated to be improperly identified or undervalued in out-of-state registrations procured through shadowy title agencies - a felony, Special Crimes Unit Deputy Attorney General Robert Morgester said.

Hot-rod enthusiasts disputed the allegations and said of the hundreds of thousands of hot rods believed to be registered in California, including an estimated 30,000 in Orange County, far fewer carried illegal titles.

"In general, if you take the hot-rodding community as a whole ... it would be closer to 10 or 5 percent," said Roger Rohrdanz, a correspondent who covers the hot-rod community for Roddin' & Racin' Newspaper.

Brian Brennan, editorial director for Street Rodder Magazine, noted that many custom-car owners found DMV guidelines on how to register their custom cars confusing or contradictory and so frequently choose to go out-of-state to simplify the process. "You're walking on unknown ground because the state of Californiahas so many rules on how to register a car," Brennan said.

The Attorney General's Office has spent the past three years investigating illegal hot-rod registrations, culminating in an Oct. 6 search of the La Habra workshop of celebrity builder Boyd Coddington.

An investigation of Coddington is continuing, and no charges have been filed.

Coddington, who is the star of the Discovery Channel's "American Hot Rod" television program, said he was not involved in the procurement of illegal titles and speculated that the 22-member multi-agency task force that searched his workshop, some with flak jackets and guns, might have focused on him because of his high profile.

"I'm probably the most easy one to get to," he said.

Law enforcement officials described illegal out-of-state registrations through "title mills" as "systemic" among custom-car owners. Morgester said his office found hundreds of new cars falsely described as "vintage" in their titles, and their estimated value reduced from tens of thousands of dollars to as little as $500.

The questionable titles allow custom-car owners to escape higher registration fees when they transfer their car to California, as well as avoid emissions standards that apply to newer vehicles.

Law enforcement's growing interest in illegally titled hot rods was sparked by a nine-month investigation into one Alabama-based title firm, Titles Unlimited, which was found to have improperly registered more than 4,200 California vehicles, contributing to a loss of $7,728,000 in DMV registration fees.

The investigation culminated in the May 7 sentencing of its owner, Richard Weaver, to one year in jail, five years of probation and required him to pay back all profits made on the California vehicles.

The case produced a paper trail linking Titles Unlimited to hundreds of California hot-rod and custom-car owners, as well as some garages that acted as middlemen in the procurement of illegal titles, Morgester said.

Investigators found that many California owners of vintage-car replicas, hot rods and kit cars paid Titles Unlimited a $200 service fee to procure Alabama titles that incorrectly listed the value or model year of their cars.

Typically, the car owner provided a bill of sale transferring ownership of their vehicles to Titles Unlimited - although no money exchanged hands. In the bill of sale, owners described their late-model custom cars as pre-1974 vintage vehicles exempt from emissions standards and of significantly reduced value, the Attorney General's Office said.

Titles Unlimited then procured an Alabama title for the vehicle, thanks to "no-title" rules in states such as Alabama, Florida, New York and Maine that allow titles to be issued without a physical inspection of the vehicle and with only a bill of sale. California, in contrast, requires an existing title and, in some cases, a physical inspection in order to issue a new title.

Titles Unlimited then drafted another bill of sale transferring ownership back to the California owner. Using the fake bill of sale and the illegal out-of-state title, the custom-car owner would then seek a California title for their "vintage" vehicle.

"It's a major concern for us," said Lt. Greg Williams, of the CHP's Investigative Services Section.

The case spurred investigators to examine other hot-rod manufacturers and builders, including House of Cobras in Anaheim and Hillbank Motors in Costa Mesa, which were subsequently prosecuted in 2003 and 2004 for facilitating illegal titles for custom-car owners.

In the case of Boyd Coddington Motors, two vintage Ford vehicles registered in California to Boyd Coddington and advertised on his Web site attracted the attention of investigators in September when discrepancies were noted in their out-of-state registrations.

In an eight-page application for a search warrant, Yolo County District Attorney investigator Bruce D. Naliboff alleged that Boyd Coddington Hot Rods "assisted in providing fraudulent and untruthful registration documents to the California Department of Motor Vehicles in order to procure ownership titles for vehicles without legitimate documentation."

Specifically, Naliboff alleged that Coddington "issued ownership certificates identifying at least two replica vehicles as original manufactured vehicles" in titles issued in New York and Pennsylvania.

One vehicle, for sale for $102,500 in Boddington's consignment showroom, listed a $15,000 purchase price on its out-of-state registration, Naliboff said.

"It's absolutely ridiculous," Brennan said of the allegations. "It is a 1932 Ford. In reality, when you get to the bottom of the paperwork, there is no problem whatsoever."

Ken Miyao, Chief Deputy Director of the DMV, said the registration process was "muddy" but that his agency was looking at legislation that would beef up the tracking and verification process of custom cars.

The DMV does not measure the number and variety of custom cars on the roads in California.

Without adequate tracking of "new" and "vintage" cars, officials expressed concern that illegal titles might enable car owners to pass off their replica cars as valuable originals to unsuspecting buyers.

"They're duping someone into thinking that they're getting something that they're not," Williams said.

"Each time that vehicle is sold, we're creating another victim."

Mike Tenerelli, the lawyer for Hillbank Motors, said most custom-car owners are under the impression that out-of-state titles are "the way it's done" in California.

"They never had the real intent to defraud," Tenerelli said. "If you go to any car show, any car rally, and ask people how it's done, they'd say this is how. It became commonplace."
Bill of sale lets a company obtain an out-of-state title
California owner then avoids high registration fees and emissions rules.


RELATED STORIES
•State: 90% of hot rods illegally registered


By GWENDOLYN DRISCOLL
The Orange County Register

The Attorney General's Office cites this process as what happens during what it calls a "title wash":

1. A California custom car owner has a 2004 vehicle valued at $50,000.


2. The California owner pays a title company in Alabama a nominal service fee to seek an out-of-state title for his car.

To do this:

3. The owner writes a bill of sale, effectively "selling" his car to the Alabama title company, although no money exchanges hands.

On the bill of sale, the owner changes the description of the car from a 2004 model valued at $50,000 to a 1965 vintage car valued at $10,000.

4. The Alabama title company uses the bill of sale to procure a title from the Alabama state DMV.

5. The title firm then drafts another bill of sale transferring the car back to the California owner.

No money exchanges hands.

6. Using this bill of sale and the Alabama title, the California owner registers the car - still described as a 1965 vintage vehicle costing $10,000 - with the California DMV.

A reduced registration fee is levied, and the car is exempted from emissions standards.

The state Attorney General's Office estimates that custom car ownersavoid an average of $5,000 per car in vehicle registration fees through such out-of-state registrations.


--------------------------------------------------------------------------------

Source: Office of the Attorney General, California Department of Justice
http://www.ocregister.com/ocr/2004/10/20/

This message has been edited by Jim C on 10-21-2004 at 12:28 PM

YellowFever
unregistered

Posts: 537
From: Corona, Ca
Registered: JUL 2004

posted 10-21-2004 12:49 PM           
It's all about money and the states wanting more from each of us.

Jezzus, with all the crime, drugs, and riots out there and this is what they spend their time with


Bob Goetz
Prowler Junkie

Posts: 2895
From: Belle Plaine MN USA
Registered: MAY 2001

posted 10-21-2004 12:54 PM     Click Here to See the Profile for Bob Goetz     
This is not a new thing it has been going on for a very long time, I have been sifting thru all the stuff I need to do to build New Street Rods so that I can get them vin tagged and titled. It seems the way all the paper work reads a person has several ways to do it as an individual and most are pretty easy. But to do it as a business is a whole different story even if tax is being paid on the purchase amount.

In a phone conversation with the DMV office the guy came right out and said " if you are building a 32 Ford have the person who buys the car obtain photos and a bill of sale for a original car then have them go to a DMV office and title it as reconstructed bring along photos and receipts for the finished car and tell them that they hired you to do the work " doing it this way they pay the tax on the parts not the value of the car, the car will only need to be inspected for lights and a horn, no emissions or safety equipment and then they will get a new vin number to be affixed to the car that will match the title.

For me to provide a certificate of origin or title as a manufacturer it would have to have safety equipment, meet emissions and pass a full inspection along with being bonded and insured there is no way that could ever happen.

As a builder for hire I still need to have insurance just like any other repair shop. But if the end user gets in a wreck and is injured because they did not have air bags put in it is their problem.

Now it all makes sense to me why so many of these Hot Rod parts companies only sell a Kit not a complete car.

They just make it so tough to get it titled the first time you have to play the game, but most custom cars will change hands several times and will make the full tax and registration on those sales. Maybe California figures a lot of these High End cars do not get sold a second time in California so they are missing out.

------------------
< CLICK HERE FOR NEW REALROD.COM PARTS >
< Click on my banner to go to realrod.com >

This message has been edited by Bob Goetz on 10-21-2004 at 01:11 PM

PCR CAT
Prowler Junkie

Posts: 49
From: WOODSTOCK ILL USA/ NAPLES FLA
Registered: JUN 2004

posted 10-21-2004 01:05 PM     Click Here to See the Profile for PCR CAT     
quote:
Originally posted by YellowFever:
It's all about money and the states wanting more from each of us.

Jezzus, with all the crime, drugs, and riots out there and this is what they spend their time with


WELL IF THE ATTITUDE IS TO SHORTCHANGE /CHEAT. THEN WHATS WRONG WITH CRIME ,DRUGS , RIOTS?

RPL
Prowler Junkie

Posts: 3448
From: Rochester Hills, MI
Registered: JUL 2000

posted 10-21-2004 01:51 PM     Click Here to See the Profile for RPL     
For a state that is known as the car capital, the beginning of hot rodding, drag racing, dry lake racing, home of the compact sport movement and on and on, it sure is anti-car. CARB (California Air Resources Board) isn't content to simply dictate emissions regulations, they've moved to regulating fuel economy with their latest rules issued last week.

This is the state that tripled vehicle registration fees last October, which were immediately rolled back by the Govenator when he took office. Ask the members from California how difficult and costly it is to "smog" and register a vehicle there,, especially an out-of-state vehicle with less than 7,500 miles on it.

This is the state that has run up huge budget deficits. So is it any surprise that they go after people that clearly have money and may have "short cut" a painful constructed vehicle registration process, saving themselves a few bucks in the meantime?

The state is driving people and companies away with their costs and fees. I know of one major automotive publishing company based in southern California that's calling it quits and moving to Tennessee.

BeWare
Prowler Junkie

Posts: 18511
From: Acworth,GA,USA
Registered: JUL 2000

posted 10-21-2004 03:05 PM     Click Here to See the Profile for BeWare     
To go into Coddington's facilities with automatic weapons and flack jackets is just plain nuts.


YellowFever
unregistered

Posts: 18511
From: Acworth,GA,USA
Registered: JUL 2000

posted 10-21-2004 03:05 PM           
quote:
Originally posted by PCR CAT:
WELL IF THE ATTITUDE IS TO SHORTCHANGE /CHEAT. THEN WHATS WRONG WITH CRIME ,DRUGS , RIOTS?

Shortchange and cheat. LOL! that's a good one.

Problem is, it's government that is always shortchanging and cheating each of us. When have you ever heard government say, "We have too much money, please don't send us any more?" When have you ever seen any government program scaled back in hard economic times. The problem is, whether the economy is good or bad, they keep coming back to the well to get more from us a little bit at a time. How do they get away with it? Well, they prey on things like leaving a deficit for our grand kids or to save social security.



Troy Gaston
Prowler Junkie

Posts: 243
From: Temecula, CA 92592
Registered: AUG 2003

posted 10-21-2004 04:52 PM     Click Here to See the Profile for Troy Gaston     
The last Check I got from the government was $1000.00 tax refund from Bush. Thanks President Bush, In return you get my vote!!

I hope they fry Boyd!!! I have no respect for that *ss!

He does none of the work him self! He just orders other *sses around.

foose is awesome and talented, and a all around good guy.

This message has been edited by Troy Gaston on 10-21-2004 at 04:53 PM

jan bruggeman
unregistered

Posts: 243
From: Temecula, CA 92592
Registered: AUG 2003

posted 10-21-2004 07:06 PM           
hers's my take.jmo-if you build a custom car from the ground up,lets say fiberglass replica,its a 2004 whatever and should pay full tilt on every thing.if you rebuild a car ,restore,lets say an original 32 ford car it will be registered as a 32 year car.if i go out and buy a 2004 dodge,thats what it is,no different, than a replica year wise you, will still pay full tilt.a 32 replica,is a 2004 replica.many of them are registered as 32"s,when there not.why should they get a break,they shouldn't.jmo

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Dale Beaman
Prowler Junkie

Posts: 2699
From: Lexington, KY, USA
Registered: AUG 2002

posted 10-21-2004 09:12 PM     Click Here to See the Profile for Dale Beaman     
I am sure they will find some way to blame this mess on George Bush!


dbudner
Prowler Junkie

Posts: 1391
From: Dallas, Ga. USA
Registered: SEP 2002

posted 10-21-2004 11:02 PM     Click Here to See the Profile for dbudner     
blubyu, that is the only thing that makes sense out of all of this

This message has been edited by dbudner on 10-21-2004 at 11:02 PM

Jim C
Prowler Junkie

Posts: 537
From: Corona, Ca
Registered: JUL 2004

posted 10-22-2004 12:30 PM     Click Here to See the Profile for Jim C     
Nah! I think its the governator... the only thing He has that He thinks is Vintage, is His 2 year old Hummer...

This message has been edited by Jim C on 10-22-2004 at 12:31 PM

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