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Police arrest Trade Me fraudster

Richard Mark Wallace has been arrested by New Zealand Police last week following numerous complaints of fraudulent Trade Me vehicle sales.

Wallace was arrested on April 12 on 13 counts of fraud after his case appeared on Police Ten-7 on April 6.

At least 16 customers were left out of pocket after paying a 50 per cent deposit to Wallace, who claimed to import cars from Japan.

Trade Me head of trust and safety Jon Duffy said some customers have received partial refunds, but the majority received nothing, and at least $55,000 has been taken.

Wallace, also known as George Auckland, used over 30 different names to defraud customers and several different companies, including ‘I Love Cars’, ‘Maroone Imports’, ‘NZer16’ and ‘Kar Guru NZ’.

Duffy said that Wallace also impersonated other registered dealers and fraudulently used their details on his Trade Me accounts.

Anyone selling a car on Trade Me should have the car in New Zealand, Duffy said. “If the deal seems too good to be true, such as the price for the car is far below market value, then it probably is.”

“Legitimate vehicle traders don’t typically ask for a 50 per cent deposit to help import the vehicle.”

Duffy also warned buyers against transferring money using a system like Western Union, and said to check the car in person before buying it. Refusing a vehicle inspection is a strong indication of suspicious activity.

The Trade Me scam is the latest in a long line of accusations of fraud. Various companies have been linked to Wallace, including American Prestige of New Zealand Inc, American Prestige of Montana LLC, Carrera Marine Holding LLC and American Marine Holdings.

These companies have since been liquidated or shut down.

Between 2008 and 2012, Wallace operated out of Boca Raton, Florida, and Tijuana, Mexico, importing and selling marine equipment, boats and trailers. At least 15 would-be buyers accused Wallace of taking their money and failing to deliver the purchase.

One customer, Jason Cannings, claimed to be $115,000 out of pocket and lodged a complaint with Florida Police.

Wallace will appear in the Auckland District Court on June 6 on 13 counts of obtaining by deception.

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New money-laundering bill to affect luxury car dealers

A new money-laundering bill introduced to Parliament by justice minister Amy Adams last night will strengthen existing anti-money laundering laws and widen the scope of investigation and prosecution by authorities.

The Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill extends legislative power to lawyers, accountants, real estate agents, sports and racing betting, and business that deal in high-end goods, such as motor vehicles, jewellery and art.

“Extending the law will improve our ability to prevent, detect and prosecute many types of criminal activity and help protect New Zealand’s reputation as a good place to do business,” Adams said.

Businesses who sell high-end motor vehicles above a certain threshold (which is not specified in the bill) will now be classified as high-value dealers and subject to the bill. While the new legislations outlines some obligations, high-value dealers will not be subject to the same scrutiny as lawyers, accountants and real estate agents.

High-value dealers will be required to report large cash transactions and must conduct customer due diligence. Records must be audited according to compliance obligations if requested by an anti-money laundering official.

They will be “required to know who their customers are and on whose behalf they act” and must comply with certain prohibitions if they are unable to do so. High-end dealers will also be able (but not required) to report suspicious activity that comes to their attention.

The government will provide information and guidance for affected businesses and give them time to prepare for the legislation.

The Act will come into force on July 2017, but will not be applicable to high-end dealers until a certain date yet to be set by the Governor-General.

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Takata pleads guilty to US felony charge

Japanese car-parts manufacturer Takata pleaded guilty to a felony charge on Tuesday in a US federal court as part of a $1.4 billion settlement.

The settlement includes penalties and compensation to both car makers and victims of the faulty inflators. The company’s chief financial officer, Yoichiro Nomura, entered the plea on behalf of the company.

Lawyers representing the victims objected to the ruling. Worldwide, 16 deaths and over 180 injuries have been linked to Takata’s defective airbags.

US district court judge George Steeh approved the settlement, saying car makers were potential victims of Takata’s 15-year efforts to hide evidence of its defective inflators. Takata is still subject to civil litigation from individual lawsuits.

The settlement is expected to rejuvenate stagnated talks to find a buyer for Takata, which have been ongoing for a year.

“Achieving a plea bargain in the United States shows some progress,” SBI Securities senior analyst Koji Endo told Reuters.

Steeh told the court he considered harsher penalties but approved the settlement, as higher fines could push Takata into bankruptcy and further delay efforts to replace faulty inflators still on the roads.  

“Destruction of the corporation would probably have been a fair outcome in this case,” he said.

Lawyers for vehicle owners have sued various car makers, including Honda, Nissan, BMW, Ford, Mazda and Toyota, alleging the manufacturers used the inflators despite knowing they were faulty.

Takata agreed to establish two restitution funds in January – $1.19 billion to compensate car makers for the extensive recalls, and $173 million for injured drivers.

Recalls are expected to continue until 2020.

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New disputes adjudicator appointed

Auckland barrister Brett Carter has been appointed as a motor vehicle disputes tribunal adjudicator by the Governor-General for a five year term beginning February 15.

Carter is formerly a chief adviser at the Commerce Commission, where he worked for 10 years.

“Mr Carter’s extensive legal background and experience in fair trading, credit and consumer laws will be particularly valuable to the Tribunal, which hears disputes between consumers and car dealers or other registered and unregistered motor vehicle traders,” said Jacqui Dean, the minister of commerce and consumer affairs.

Carter will mostly hear cases in Auckland and the Northern North Island. He takes the role of Christopher Cornwell, who recently stepped down as an adjudicator after more than 10 years in the role. Dean also acknowledged Cornwell’s service in her statement.

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