Kia America Sues Auto Group In New England For Fake Sales 🤣

What is up guys? Welcome on back to TK's Garage and today's video is definitely kind of hypocritical for dealers to do, specifically speaking about what we've been talking about the last few days. So let's roll that intro. What is up guys? Welcome on back to TK's Garage and in today's video I'm going to put the story over here, but this is breaking news out of my hometown right now over at Boston.com. Kia sues New England dealership over alleged fake car sales. Tell me how funny that is when we have the same fake sales going on at Ford and Stellantis right now. Evidently Kia is like, hey, we don't want to commit fraud. Let the other guys commit fraud. We don't want to do it. So let's read into it. Kia alleges that Dan O'Brien Auto Group submitted hundreds of fraudulent retail delivery reports for vehicles that hadn't actually been sold to customers. Kia America has accused a New England car dealer of falsifying retail records and pocketing hundreds of thousands of dollars in ill-gotten sales incentives. In a federal lawsuit filed in New Hampshire last month, Kia alleged that Dan O'Brien Auto Group and its top management submitted hundreds of fraudulent retail delivery reports for vehicles that hadn't actually been sold to customers. The lawsuit names six current and former O'Brien dealerships in New Hampshire and Massachusetts, as well as the Auto Group CEO Dan O'Brien and Chief Operating Officer Tom Kuhn, hurling allegations of racketeering, fraud, conspiracy, and related claims. Kia accused the dealerships of shuffling inventory around to mask the purported deception. So basically, and their defense attorney has come out immediately and said, Paul Harris, who's representing the Auto Group, Dan O'Brien Auto Group, has said that the accusations are false. What this dealership did is perfectly legitimate, he said in a phone interview. So let's just talk about this real quick. So the same thing that some of these major auto groups have told Stellantis, hey, we're not doing this, is exactly what Kia is saying that the Dan O'Brien Auto Group did, by basically doing dealer-to-dealer transfers so the cars don't show up. So if Kia was actually looking at something, they were like, oh, that car's gone, but then it pops up somewhere else for another dealer. And then if they actually sell that car, that same car gets resubmitted twice for the same incentives in some cases. That's what Kia is claiming. I wasn't there. I don't know what happened. I just find that this is interesting. I feel like the battle between dealers and manufacturers is just starting to take off. When you have two of the country's largest auto groups in the entire United States telling Stellantis, we are not going to commit fraud for you, and then you have another auto group in New England doing this, which Kia claims is fraud, I get it. Now, it's not as high as the numbers that we've talked about with the Stellantis and Ford stuff, but let's go from it. From January of 2019 through July of 2021, there was a substantial discrepancy between the number of new vehicles the O'Brien-Kia dealerships had on hand and the inventory they should have had if their sales reports were accurate, the complaint alleged. At times, the discrepancy exceeded 350 new Kia vehicles at any time. Now, that can happen if you're transferring vehicles from one dealership to another. Maybe the Forte is selling better in New Hampshire, or maybe the higher-priced vehicles are selling better in New Hampshire because there's no sales tax and vice versa with Massachusetts. That's possible, especially within an auto group, and it doesn't look like the O'Brien auto group is that small. The alleged ruse came to light in June of 2021 when a Kia auditor visited the O'Brien dealership in Nord, Massachusetts and Concord, New Hampshire. According to the complaint, the audits purportedly turned up dozens of vehicles that had been reported as sold. Kia put its estimated damages at more than $500,000, citing at least 280 delivery reports that supposedly contained false information. That's just crazy. Now, you know, look, I don't know if they did it or not, or if it was an error or an oversight. I thought it was newsworthy and something I should bring to your guys' attention because, one, it's in my hometown, you know, it's in my home area and being covered on boston.com. And I thought, isn't this like the pot calling the kettle black, right? Maybe Kia and Hyundai are not doing the same fraudulent activity that Stellantis and Ford and BMW are doing right now. BMW just got slapped on the hand not too long ago for $18 million for doing that. But I think we're going to see the ramp up as the margin between MSRP and invoice does this and gets smaller. I think we're going to see more dealer versus manufacturer fights and lawsuits and more as this continues to just go about its course. But what do you guys think? Do you think the manufacturer is kind of the pot calling the kettle black when they regularly do crap like this to inflate their numbers? So a dealer did it to get incentives so that they can actually make money off the cars and now it's a problem? I think it's kind of hilarious if you ask me. But anyways, thank you guys very much for watching. I truly appreciate it. We did have the pinky out on this one. Make sure to give the video a big thumbs up if you like what I do. Hit the subscribe button if you haven't already. And as always, stay petty, my friends. For everyone that stayed to the end of the video, I wanted to give everybody just a major thank you and a major salute for all of the growth and everything that's been going on with the channel lately. I truly appreciate it, and we're going to continue doing what we're doing. So stay tuned.