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Former Honda Executives Get Prison Terms : Bribery: Case is called biggest of its kind in U.S. history. Dealers paid $15 million for favors.

From Reuters

Two former senior executives of American Honda Motor Co. were sentenced to prison terms Monday for their involvement in what prosecutors called the largest commercial bribery case in U.S. history.

A federal District Court here sentenced Dennis Josleyn, 48, a former West Coast sales manager, to 6 1/2 years in prison for mail fraud, racketeering and conspiracy to commit mail fraud. John Billmyer, 65, American Honda’s top U.S. sales manager from 1983 to 1988, received a five-year sentence for mail fraud.

Both were convicted in federal court in June for playing key roles in a nationwide bribery scheme in the 1980s.

Billmyer, of Raleigh, N.C., was found guilty of accepting kickbacks of tens of thousands of dollars from Honda dealers in exchange for awarding franchises and allocations of certain popular Honda and Acura models at a time when the cars where in high demand and short supply.

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Josleyn, of Loveland, Colo., had been found guilty of accepting more than $1 million in payoffs from dealers and advertising agencies and through kickbacks from company-sponsored training seminars.

Torrance-based American Honda now faces millions of dollars in lawsuits from disgruntled dealers who did not receive the preferential treatment handed out by the rogue Honda executives and employees. American Honda is a subsidiary of Japan’s Honda Motor Co. Ltd.

In all, 22 former Honda employees, two former dealers, a lawyer and an advertiser were involved. Most have already been sentenced for accepting bribes in the form of cash, expensive cars, furniture, swimming pools, Rolex watches, college tuition and shopping sprees in Hong Kong.

The bribes, totaling $15 million, were paid by automobile dealers in exchange for preferential allocations of hot-selling Honda and Acura models, which during the 1980s oil crisis could be sold for thousands of dollars above their sticker prices. The ring operated in at least 30 states throughout the 1980s.

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The case came to light in New Hampshire after a local dealer complained that he had been treated unfairly by Honda executives, triggering a federal investigation.


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