silvrsvt Posted July 18, 2016 Share Posted July 18, 2016 http://www.autonews.com/article/20160718/RETAIL/160719858/fbi-sec-investigating-fca-us-sales-practices Like I said before...those month-to-month sales increases over the past 5 plus years seemed awfully fishy to me. 1 Quote Link to comment Share on other sites More sharing options...
bzcat Posted July 19, 2016 Share Posted July 19, 2016 (edited) This is the start of the criminal investigation following the allegation of false sales reports from the civil racketeering lawsuit that was filed back in January. Looks like the Feds had seen enough court documents from the civil lawsuit to start subpoena witnesses and obtain evidences. Not good for FCA... Edited July 19, 2016 by bzcat Quote Link to comment Share on other sites More sharing options...
mustang let back Posted July 19, 2016 Share Posted July 19, 2016 fca cooking the books.im not surprised. Fixing Cars Always :happy feet: Quote Link to comment Share on other sites More sharing options...
Bryan1 Posted July 22, 2016 Share Posted July 22, 2016 http://www.autonews.com/article/20160718/RETAIL/160719858/fbi-sec-investigating-fca-us-sales-practices Like I said before...those month-to-month sales increases over the past 5 plus years seemed awfully fishy to me. Agreed. Everything is reported as "the best." It doesn't add up. Quote Link to comment Share on other sites More sharing options...
30 OTT 6 Posted July 25, 2016 Share Posted July 25, 2016 Forget the espresso, get out the grappa. 1 Quote Link to comment Share on other sites More sharing options...
Anthony Posted July 25, 2016 Share Posted July 25, 2016 Forget the espresso, get out the grappa handcuffs This could lead to some unfortunate time behind bars for some high level people. They are a public company and this is a serious accusation which has a direct effect on stockholders. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 25, 2016 Share Posted July 25, 2016 Jail time? Seems reaaaaaaaaaaaaaaalllllllllllllllllllllllllllllly unlikely. Quote Link to comment Share on other sites More sharing options...
Anthony Posted July 25, 2016 Share Posted July 25, 2016 Jail time? Seems reaaaaaaaaaaaaaaalllllllllllllllllllllllllllllly unlikely. Unlikely, yes. But if you look at this as securities fraud or stock manipulation there is plenty of precedent. Quote Link to comment Share on other sites More sharing options...
akirby Posted July 25, 2016 Share Posted July 25, 2016 No jail time but the officers better hope they didn't sell stock or cash in options based on pumped up sales data or the SEC will be all over them. They could be forced to give back the profits plus 3 times the profits in penalties. And the perpetrators could also be liable for the penalties even if they didn't profit at all. We just completed our Insider Trading lecture by a former SEC attorney. 1 Quote Link to comment Share on other sites More sharing options...
fordmantpw Posted July 25, 2016 Share Posted July 25, 2016 No jail time but the officers better hope they didn't sell stock or cash in options based on pumped up sales data or the SEC will be all over them. They could be forced to give back the profits plus 3 times the profits in penalties. And the perpetrators could also be liable for the penalties even if they didn't profit at all. We just completed our Insider Trading lecture by a former SEC attorney. Well, if you can't trade, maybe you can pass me some secrets. I've already got a few shares in my wife's ROTH, and always looking to add to it. I like the solid 4.5% yield... Quote Link to comment Share on other sites More sharing options...
akirby Posted July 25, 2016 Share Posted July 25, 2016 Buy low, sell high. That's the extent of my tips. 1 Quote Link to comment Share on other sites More sharing options...
akirby Posted July 25, 2016 Share Posted July 25, 2016 The SEC attorney (former) had some great stories. He said if they ever found a guy who did a trade in his ex-wife or ex-girlfriend's name it was a slam dunk, because they would rat out their former partner without any hesitation. Hell hath no fury and all that..... He said the big mistake most folks made is that they would waive their right to an attorney when they had the initial meeting. And they would say things that would later incriminate them. Their reasoning was usually that they didn't want to appear guilty to the investigator. The investigator said "I already think you're guilty - that's why I'm here!" Quote Link to comment Share on other sites More sharing options...
Anthony Posted July 26, 2016 Share Posted July 26, 2016 FCA Press Release about sales reporting: http://media.fcanorthamerica.com/newsrelease.do?id=17747&mid=1 Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 26, 2016 Share Posted July 26, 2016 AFAIK, that hardly addresses the issues which are: 1 - that FCA was gaming its year-over-year sales increases not because it bolstered revenue but because it presented a distorted view of the company's overall health. 2 - that FCA's primary tool in achieving this was incentivizing dealers to purchase vehicles new and then resell them as used Channel stuffing is widely known to be the preferred means by which an ailing wholesaler/manufacturer bolsters its bottom line. Quote Link to comment Share on other sites More sharing options...
akirby Posted July 26, 2016 Share Posted July 26, 2016 Bottom line: 1. FCA US in March of this year last commented specifically about a “streak” of year-over-year monthly sales improvements since April of 2010. Applying this new methodology, during the periods presented below, year-over-year monthly sales would have declined in September 2013 (-3%), August 2015 (-1%) and May 2016 (-7%). The so called “sales streak” would have stopped in September 2013 (after 40 months) and would have had three additional periods of sequential year-over-year improvements of 22, 8, and 1 month(s).2. Annual sales volumes under the new methodology for each year in the 2011-2016 period are within approximately 0.7% of the annual unit sales volumes previously reported.3. The monthly adjustments to previously reported sales as a result of the adjustment to deduct sales later unwound and add back sales attributable to previously unwound sales over the period January 1, 2011 to June 30, 2016 are a mix of positive and negative numbers which did not exceed 0.5% of the reported data in any month. The maximum numerical reduction from previously reported data was 770 units (0.5% of the month’s volume) in May 2015 and the maximum numerical addition to previously reported data was 437 units (0.4%) in September 2014. The total over the 2011 to 2016 period representing unwound transactions previously reported as sold for which vehicles remain in dealer stock at June 30, 2016, is approximately 4,500 vehicles, or 0.06% of the total volume reported over the period (7.7 million cars). Quote Link to comment Share on other sites More sharing options...
bzcat Posted July 27, 2016 Share Posted July 27, 2016 (edited) AFAIK, that hardly addresses the issues which are: 1 - that FCA was gaming its year-over-year sales increases not because it bolstered revenue but because it presented a distorted view of the company's overall health. 2 - that FCA's primary tool in achieving this was incentivizing dealers to purchase vehicles new and then resell them as used Channel stuffing is widely known to be the preferred means by which an ailing wholesaler/manufacturer bolsters its bottom line. Actually #2 is not the issue SEC is investigating. Channel stuffing is basically industry practice as you mentioned... everyone do it once in a while. FCA did it a lot but it's perfectly legitimate accounting practice as long as those vehicles are eventually sold as used. The issue being investigated is the outright fraudulent sales reporting. In the civil racketeering lawsuit filed in January 2016, the allegation from dealers was that FCA was improperly inducing dealers to report sales of demo units or to straw buyers (like friends and family of dealer employees) before month end but not process the warranty paperwork, and then allowing the dealers to reverse those sales in the subsequent month as if nothing ever happened. Those vehicles are then eventually sold as new. Basically FCA was manipulating the timing of when new vehicle sales are reported in order to maintain month-to-month sales gains. I think (speculation alert) SEC has seen enough court filings from the civil lawsuit to know there is systematic financial fraud going on at FCA so they launched a criminal investigation with FBI. Edited July 27, 2016 by bzcat Quote Link to comment Share on other sites More sharing options...
630land Posted July 27, 2016 Share Posted July 27, 2016 Wanted to make company look good to sell off, and then Sergio can retire "famous for saving Chrysler/Jeep". Quote Link to comment Share on other sites More sharing options...
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