A former sales manager at a Birmingham Nissan-VW dealership has been indicted by a federal grand jury for allegedly defrauding Capital One Auto and others by submitting fake car loan applications.
The Birmingham News reported yesterday that Abdul Islam Mughal, former general sales manager at Serra Nissan, was charged with “falsifying customers’ loan documents and submitting the fraudulent information to various financial institutions to obtain auto financing,” according to the criminal complaint obtained by Auto Finance News.
Capital One Auto Finance was the only lender named in the complaint, though according to the document, “several finance institutions have been subpoenaed and have provided multiple loan documents which reflected further evidence of Serra Nissan submitting falsified loan documents to these financial institutions.”
Mughal pleaded not guilty and a U.S. Magistrate judge released him on $5,000 bond. Mughal had been arrested as he attempted to leave the country for the United Arab Emirates, after having emptied his personal bank accounts at Legacy Credit Union.
The FBI relied on a confidential informant for much of its evidence. The informant, a former Serra Nissan-VW employee, voluntarily approached the FBI in March 2013 and provided several audio recordings regarding the loan fraud, documented proof of fraud, and other documentation he “acquired” while employed at the dealership. For instance, in one recorded conversation between Mughal and a salesman, Mughal instructs the salesman to say on a loan application that a female customer, believed to be on $2,000 disability or retirement income, actually has income of $5,000, the level Mughal tells the dealer would be necessary for loan approval.
The indictment said that on June 21, 2013, Capital One Auto Finance provided the FBI with documentation for a loan funded Oct. 17, 2012, for a customer named Turner. COAF investigated the loan this past February and found that the bank statement submitted with the loan was fraudulent and was not provided by Turner. In fact, Turner told Capital One that her income was $1,600 a month, not $5,000 as stated on the application.
Augusta Dowd, the White Arnold & Dowd lawyer representing Serra Nissan, told AFN that the dealership is cooperating fully with the ongoing federal investigation. She could not give a dollar figure on the total amount of money Mughal attempted to obtain fraudulently.
Per corporate policy, Capital One would not comment on the pending litigation.