Guam Luxury Car Re-Export Scam Involved Shell Company

Evidence against Presitige Automobiles' Guam to China exports unveiled in Court

By Jasmine Stole

HAGÅTÑA, Guam (Pacific Daily News, June 5, 2017) – Local car dealership Prestige Automobiles reportedly used a shell company to ship BMW cars from Guam to China to escape detection by manufacturer BMW, according to a search warrant unsealed in the Superior Court of Guam.

Prestige Auto, the dealership’s owner John Shen Sr. and two others are charged with multiple counts of identity theft, record tampering, forgery and conspiracy. Luxury vehicles allegedly were falsely registered in the names of Guam residents, without their knowledge, and were instead shipped to China.

In addition to Prestige Auto, Shen controls or is affiliated with companies Shen’s Corporation, Shen’s Enterprises, MGT Corporation and Pan Asia Wholesale Corporation, court documents state.

Prestige Auto allegedly shipped cars from Guam to China using Pan Asia as a shell company, court documents state.

“Shen is only authorized to import vehicles … into the Guam Micronesia region and then sell the vehicles from Prestige Automobiles,” stated FBI agent Joshua Kipp in an affidavit attached to the search warrant.

“By selling the cars to Pan Asia, who then exported them to China, Shen was working in a different market where he was not a licensed dealer.”

Prestige Auto in about 2014 and 2015 sold millions of dollars worth of luxury cars to Pan Asia in the span of 10 months, court documents state. The sales were also noted in Shen’s Corporation's finances and tax returns, documents state.

The sales to Pan Asia were treated as wholesale sales, which meant Prestige Auto or Shen’s Corporation did not have to pay Guam gross receipts taxes, documents state.

Kipp stated that transactions through Pan Asia were also done to so the company would not pay local business privilege tax.

BMW Singapore had previously penalized Shen, reportedly because Shen was not authorized to export cars to China, court documents state.

Shen allegedly had to pay $45,000, or 40,000 euros, to BMW for the Pan Asia sales.

Between January 2014 and August 2015, China-based auto traders wired money to MGT and within days MGT wrote checks to Shen's Corporation or Prestige Auto, according to the affidavit. 

More than $4.8 million was paid out to Shen's Corporation or Prestige, court documents state. 

Court documents state Pan Asia was formed in 2014 and Shen’s longtime accountant is listed as the registered agent in Department of Revenue and Taxation records, court papers state.

MGT Corporation was formed to run Goodyear Tire.

Shen and the dealership’s sales manager, Orlando Domingo, and former employee Ana Kristine Lara Absalon  were indicted in December and pleaded not guilty to the charges.

Authorities discovered Prestige Auto's alleged shipment of cars to China after a man tried to apply for public assistance and Rev and Tax records showed he bought two cars from Prestige Auto. The man reportedly never bought the Land Rover or a BMW X5 that were in his name, court documents state.

When the motor vehicle division asked Prestige Auto how the car was registered to the man without his knowledge, the sales manager then tried to "de-register" the car, court documents state.

Authorities were able to find six people who were unaware that they were registered owners of Prestige Auto cars. More than 50 cars were were sold without liens on the applications, court documents state. 

Pacific Daily News
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