23 luxury vehicles seized at L.A., Long Beach ports were part of fraud scheme targeting Chinese nationals, border officials say

By JOSH CAIN | jcain@scng.com | Los Angeles Daily News
PUBLISHED: October 31, 2018 at 6:38 pm | UPDATED: November 1, 2018 at 10:52 pm


Border agents and California Highway Patrol investigators intercepted nearly two dozen pricey vehicles at the ports of Los Angeles and Long Beach bound for black-market buyers in China, officials said Wednesday.

The luxury vehicles — all Mercedes-Benz and Land Rover SUVs — were part of a scheme to defraud mostly Chinese nationals living in the United States, a U.S. Customs and Border Protection official said.
The perpetrators operating in both the U.S. and China offered the victims deals to cut them in on the profits when the exported vehicles were sold. But instead of following through, the fraudsters would vanish, leaving the victims stuck with the bill for loans on the vehicles, said Philip Morin, the CBP chief of the Los Angeles/Long Beach Seaport complex.

“(The suspects) recruit people online to go and use their credit to buy the cars…they give them the money to make the first payment or two,” Morin said. “And then they disappear.”

Morin said it’s not clear how the victims were recruited, but he said investigators believe the suspects contacted them through emails. He likened the scheme to the ubiquitous “Nigerian prince” email scam promising future riches for small upfront payments.

But in this case, the victims are left with payments on vehicles worth between $80,000 and $90,000, Morin said.

“(The victims) are middle men. They’re purchasing the vehicle and hoping these people will continue to pay them,” he said. “People are gullible, so they take the offer.”

Morin said investigators could not pinpoint where the victims lived, but he said they were not limited to Southern California.

In a statement, CBP spokesman Jaime Ruiz said 23 vehicles being exported as part of the scheme were recently seized at the port complex. Among them were 11 Mercedes-Benz GLS 450s and 12 Land Rover Range Rovers, with a total value estimated at $1,885,415.


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Customs officials said 23 luxury SUVs were seized at the ports of Los Angeles and Long Beach that were part of an export fraud scheme targeting Chinese nationals living in the United States. (Courtesy photos provided by U.S. Customs and Border Protection)


Morin said investigators targeted the vehicles after routine checks of their vehicle-identification numbers showed that they were recently purchased. The checks also showed that loans on all of them were still unpaid — federal law prohibits vehicles with outstanding loan payments from being exported.

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Luxury vehicle brands like Mercedes-Benz and Land Rover have become increasingly popular among a burgeoning wealthy class in China and around the globe.

“There is a global black market where foreign individuals are willing to pay a premium for desired luxury brands and vintage models regardless of importation fraud schemes,” Ruiz said in the statement.

Other types of vehicles seized in previous export fraud schemes included Cadillac Escalades and stretch limos.

Morin said buyers there pay two to three times the price the vehicles are sold for stateside.

No arrests were made as part of the operation, but Morin said investigators believe they have identified the man who targeted the scam victims. He said the man is also a Chinese national, and is believed to have fled the country.

Morin said the man was likely working with a handful of other suspects, some involved in creating counterfeit titles for the vehicles.

California Highway Patrol investigators will take over the criminal investigation of the scheme, and will likely work with Chinese officials to attempt to extradite the primary suspect back to the United States.

In the past seven years, Morin said CBP has made two other significant busts of numerous luxury vehicles being exported fraudulently. He said the most recent was several years ago, when border agents seized 50 vehicles total.

In one case, a 1967 Jaguar convertible stolen in Manhattan was recovered.

He also said similar scams were uncovered in other ports on the East Coast and in Texas.

Morin said the scam perpetrators take advantage of the huge volume of shipments flowing in and out of major ports like L.A. and Long Beach. In the statement, Ruiz said agents process 700 to 1,200 vehicles a day for exportation.

The vehicles seized recently were not disguised, but other schemes have attempted to hide the stolen vehicles in other types of shipments to avoid having to present a counterfeited title to border officials.

“You could just report (the shipment) as boxes of old televisions.” Morin said. “We have found just plain old stolen cars with no title in shipments. They can be declared as anything from toilets to scrap metal.”

https://www.presstelegram.com/2018/1...officials-say/