Eight Charged in $50-Million Car Loan Fraud
Eight former employees of an auto firm that prospered with the growth of Southern California’s Asian community were charged with criminal fraud Wednesday for tampering with credit reports and other schemes that left lenders with $50 million in bad loans.
The conspiracy charges, brought by the U.S. Attorney’s Office in Los Angeles, arose from a federal investigation of the Grand Wilshire Group of companies, based in Glendora. Now bankrupt, the group once included the nation’s third-largest auto dealership and was believed to be the largest minority-owned business in Southern California.
Its president, Eminiano (Jun) Reodica Jr., was named as an unindicted co-conspirator. The Philippine native--who rose from toiling as a busboy to being a celebrated immigrant entrepreneur--vanished in 1988 as his auto empire became mired in financial difficulties.
“We do expect additional charges to be filed,” said Ronni B. MacLaren, the assistant U.S. attorney prosecuting the case. “We’ve just completed the first phase. There’s a lot more to do.”
According to MacLaren, the employees engaged in a variety of schemes that induced lenders to keep advancing cash. The fraud allegedly entailed deleting negative credit information from TRW reports, concealing delinquency rates on customer payments and using the same contracts to secure credit from more than one lender.
The charges were part of a 17-count “information,” under which prosecution cannot move forward unless those named choose to wave being indicted. Often, an information is filed as part of a plea bargain, although MacLaren did not confirm that was her strategy. By all accounts, Reodica is the key target of the investigation.
Named Wednesday were: Bruce Li, 31, Grand Wilshire’s former executive vice president; Erlinda Relosa, 43, Reodica’s personal secretary, and her husband, Ramon Relosa Jr., 44, a manager. Also charged were employees Emelita Carino, 39; Evangeline Zapido, 43; Mariano Abella, 40; Francisco Villasenior, 53, and Greg Mangalindan, 30.
“These people (named Wednesday) are all victims, at least largely,” said Alexander Kirkpatrick, an attorney for Ramon Relosa. “They were employees.”
Others seemed surprised at the announcement. “I really can’t say much until after I read” more on the charges, said Salvador Tuy Jr., an attorney for Carino, who solicited investors for Grand Wilshire, according to the U.S. Attorney’s Office.
According to the U.S. Attorney’s Office, Imperial Savings Assn. of San Diego, Union Bank, First Los Angeles Bank, Manilabank California, Heller Financial Inc. and General Electric Capital Corp. were among the lenders defrauded of some $50 million.
But one financial executive found the $50-million figure to be low. Losses at Imperial Savings alone may exceed $50 million, said Richard J. Annen, the firm’s executive vice president and general counsel.
Grand Wilshire, which was linked to the Grand Chevrolet dealership in Glendora and some two dozen others, declared Chapter 11 bankruptcy in August 1988. The firms also were connected to Grand Motors, which had auto brokerage outlets throughout California, often catering to Asian consumers.
Before the financial problems became known in 1988, Reodica enjoyed celebrity status in the U.S. Filipino community, seeming to personify the success that many search for in this country. Since his disappearance, sightings of him have been rumored in Chicago and other places, although he was last seen in Manila in August of 1988, the day Grand Chevrolet filed for bankruptcy.
“There have been sightings,” joked Roy Gorre, a press attache in the Philippine consulate in Los Angeles. “He’s kind of the Elvis Presley of the Philippine community.”
And though Reodica was not charged along with his former employees Wednesday, it seemed clear that he remains a major target of the investigation.
“He is clearly the most culpable--and the investigation is ongoing with respect to his culpability,” MacLaren said.
