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Felony charges for 2 car dealers

Former Auburn auto executive arrested
By: Penne Usher Journal correspondent
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A former Magnussen Dodge of Auburn partner Larry Carmean is behind bars in El Dorado County charged with several felonies including money laundering. Carmean, 61, most recently operated Carmean Dodge in Shingle Springs and El Dorado Hills Dodge until late 2008. Prior to starting his own car dealership, Carmean had an interest in the Auburn dealership. Carmean was arrested around 7:30 Friday morning in Orangevale. Former general manager John Catalano, 38, was arrested in Folsom. Both have been charged with multiple counts of grand theft and embezzlement resulting in losses of up to $1.3 million to several customers of the dealership and various financial institutions, according to investigators. The arrests followed an 18-month long investigation by the El Dorado County District Attorney’s Office, the Department of Motor Vehicles and the Department of Insurance. “During the months of May 2008 through July 2008, Carmean, the sole proprietor of the dealership (Carmean Dodge) is alleged to have acquired and sold numerous vehicles, engaging in theft and embezzlement prior to the abandonment of his business location,” according to information provided by the DMV. The investigation revealed Carmean Dodge allegedly defrauded Chrysler Financial for $1.6 million in new car inventory, $750,000 in used car inventory, and $132,000 in used car inventory to AFC Financial. Also identified were 92 transactions occurring between May and July 2008 with possible violations, including failure to transfer title and registration, failure to return down payments failure to pay for warranties, extended service contracts and gap insurance policies. Casey Butler of El Dorado Hills bought a 2008 Dodge Ram pickup truck from Carmean Dodge and says he was one of the many financial victims. “They talked me into an upgraded lifetime service plan for the truck,” he said. “Turns out a week later they are closed down and the contract isn’t any good anywhere else.” Fortunately, Butler was able to find a dealership to honor the contract — Magnussen Dodge in Auburn, where Carmean once worked. “Not only did I get ripped off on the truck — that’s partly my fault, I had this contract that wasn’t any good,” Butler said. “Magnussen is honoring it, but that means I have to drive up to Auburn.” Ron Wells, general sales manager for Magnussen, confirmed that they will honor service contracts. “We are honoring the valid service contracts from (Carmean) — verified through Chrysler,” he said. “My best advice would be to come by and let us review the contract and see what we can do.” George Valverde, director of the DMV, said it is unusual for a dealer to be so unscrupulous. “Nearly all dealers play by the rules, but crimes against California customers simply will not be tolerated,” he said. “Protecting California consumers is a top priority of the department, and a crime such is this is one that we take very seriously.” The defendants are currently being held without bail in El Dorado County Jail. Penne Usher can be reached at penne.usher@gmail.com.