Tuesday, July 19, 2011

Former Car Dealer Convicted in Multiple Fraud Schemes

PHILIP SWINDALL, 50, of Duluth, Georgia, pleaded guilty today in federal district court to bank fraud, wire fraud, and aggravated identity theft.

According to United States Attorney Yates, the charges, and other information presented in court: SWINDALL was involved in selling cars in the Atlanta metro area for the last decade, and had been involved in multiple schemes during that period. The first scheme began in April 2004, when SWINDALL was operating Atlanta Chrysler Dodge, an automobile dealership. He applied for and received $8,200,000 in loans and lines of credit from SouthTrust Bank, which is now Wells Fargo Bank, to fund and operate Atlanta Chrysler Dodge. In addition, SWINDALL had a silent business partner, who put up $4.7 million in collateral, including that partner’s $2,300,000 mansion in Colorado.

By the summer of 2005, the bank’s auditors showed SWINDALL was more than $3,500,000 in debt. SWINDALL claimed that most of the debts were due to slow payments from a fleet customer. Ultimately, the auditors determined that the fleet customer had paid SWINDALL, but SWINDALL had not paid the bank. SWINDALL had in fact used the $3,500,000 so he could operate another dealership, pay off his credit cards, and live a high-end lifestyle for himself and his family, including foreign vacations, household expenses, and household employees. The losses to the Colorado business partner and the bank exceeded $3,500,000.

The second scheme began in 2009, when SWINDALL opened another dealership, Auto Tailor, Inc., in Duluth, Georgia. Over the next year, he purchased more than 30 cars from other dealers either on consignment or by sending the dealers insufficient fund checks. He then sold the cars to customers online through E-Bay. The evidence showed that SWINDALL pocketed over $490,000, and never provided the customers with titles to the cars, or paid the other dealers.

In yet a third fraud scheme, in August 2009, SWINDALL engaged in identity theft and used an employee’s name and other personal information to obtain a $175,000 loan from Dealer Service Corporation as part of another business-related transaction designed to ultimately enrich SWINDALL.

SWINDALL was charged in a criminal information in June 2011 on 17 counts of bank fraud, wire fraud, and aggravated identity theft. Today he pleaded guilty to one count each of bank fraud, wire fraud, and aggravated identity theft. He could receive a maximum sentence of 52 years in prison and a fine of up to $1,500,000. In determining the actual sentence, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Sentencing is scheduled for September 21, 2011, at 11 a.m., before United States District Judge Steven C. Jones.

This case is being investigated by special agents of the Federal Bureau of Investigation and detectives of the Duluth, Georgia Police Department.

Assistant United States Attorney David Leta is prosecuting the case.

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