Pittsfield Licensing Board again suspects counterfeiting at used car dealership / iBerkshires.com
PITTSFIELD, Mass. — The Licensing Board suspects a local car dealership of falsifying documents for the second time in two years.
The owner and employee say it is identity theft and have hired an attorney.
On Monday, the board voted to continue a hearing for D&K Affordable Motors until April 25 after being told an employee had attempted to register another dealership under the same license.
Meanwhile, the council has requested bank documents and criminal records from the two parties involved: manager Kaitlyn Rathbun and her employee and partner Devon Fitts.
Fitts and Rathbun attribute the situation to identity theft.
D&K Affordable Motors has a Class 2 license with number 297 for its premises at 48 Dalton Ave. issued in 2020. As it appears, Fitts submitted the same license to AuctionACCESS — an online accreditation system for dealerships — for Young’s Auto Sales at 111 W Housatonic St., which is a vacant lot.
It was brought before the board to determine whether D&K Affordable Motors’ license should be revoked.
In 2020, the dealer had his license suspended for a week for having too many vehicles on the premises and suspicion of false papers. Documents submitted to council earlier that year contained the signature of the property’s previous owner, Louis Costi, when the owner was in fact Messias Jordao.
Pittsfield Police Sgt. Marc Maddalena investigated the current incident and presented his findings to the board.
“I was contacted by the Licensing Board via the City of Pittsfield to investigate the possible fraudulent license provided to AuctionACCESS via the internet. They were attempting to register a used car dealership via AuctionACCESS as Young’s Auto Sales, but they were trying to use the license number coincided with D&K,” he explained.
“So it was a different company, but with the same license number as D&K, as part of the audit, AuctionACCESS, as part of their procedures, whenever they get something that requires authorization, they attempt to contact the licensing board of that county, city, or town to verify that it is a valid licensee and that it has followed the proper procedure.
“When they contacted the City of Pittsfield, they were advised that this dealership did not exist and that the license number attached to this dealership existed under a different name, being D&K Affordable.”
In mid-December, Maddalena went to D&K to tell the two about the fake document. He asked if they had any identity issues or if they could explain why this might have happened and Fitts reported that his wallet had been stolen a few weeks prior, i.e. before the attempt to registration on AuctionACCESS.
Fitts had not reported the incident to the police department, but the next day Rathbun came to the department and filed a report for the stolen items – including a wallet – on his behalf.
She also indicated that she wanted to file a complaint that her license had been changed based on correspondence with Maddalena the previous day and record it.
“She didn’t have any documentation or evidence that Mr. Fitts’ information was stolen, such as whether a credit card may have been used, but she came to report it,” Maddalena added.
The sergeant did not understand why anyone would change the license of the car dealership. He later discovered that Rathbun and Fitts had both received Paycheck Protection Program (PPP) loans and that D&K was in financial difficulty based on conversations with two creditors.
He reported that Rathbun and Fitts applied for and received Federal Paycheck Protection Program (PPP) loans that were disbursed through Greylock Federal Credit Union. Maddalena’s report and online records indicate Rathbun received $16,250 in February 2021 and Fitts $19,700 in April 2021.
Fitts’ PPP loans were for sole proprietorship of a dealership at 111 W Housatonic St., the same address of the business that attempted to register with D&K’s valid license.
This was submitted to the Attorney General’s office for further investigation.
Maddalena also spoke with two of the dealership’s creditors, Kinetic Advantage and NextGear Capital, and based on the conversations, reported that D&K had defaulted with both companies, repossessed cars, and had outstanding balances for which the companies plan to sue.
Rathbun allegedly told Kinetic that she would not pay the amount owed to them.
In February, Maddalena returned to D&K to speak to Fitts about the PPP loan, and he said he stole personal property, including identification papers, from a locker at Affordable Safe Storage on Fourth Street a year prior.
Fitts said he did not report the incident to the police department, but did report it to the company.
Maddalena feels that getting a new license from a new dealer would allow them to have a story of their own so they can visit auction sites to buy vehicles after struggling financially.
He added that in 24 years of work, he hadn’t seen identity theft used to open a car dealership, as is usually the case with cashing checks and opening accounts.
“When you put it all together, it doesn’t seem to be factual,” Maddalena said.
The licensee’s attorney, William Martin, interrupted the testimony and said it looked like a trial with a lot of hearsay. For the record, he said there needed to be more nuance in his view.
“The answer to your question about the motive is: the motive for doing a fake license is to apply for a fake PPP loan because you have to have a business to get a PPP loan,” Martin said.
“And so there’s a lot of other stuff going on. I got hired on Thursday, I read this police report and I was like, ‘those are really bad facts,’ I was like, ‘He missing one incredibly important fact,” which I discussed with the sergeant prior to this interview, where did the money go? We don’t know the answer to that question.
Martin has contacted Greylock Federal to try to locate the loan that was disbursed through him and has yet to hear back. He said he had statements from Fitts’ bank accounts at the time the funds were supposed to be disbursed and there is no deposit for the $19,700.
He discovered that Rathbun’s deposit of $16,250 was in his account.
“It’s interesting to know, and I think a lot of us were sort of frantically doing these PPP loans and wondering after the feds handed out all this money without thinking about it, what was going to happen in the background? Well, now we know what’s going to happen on the backend,” Martin said.
“Keep in mind that most of these loans were made, I won’t say anonymously, but very electronically for a lot of time, not like the regular volume where you got a notarized document, so when Mr. Fitts says his identity was stolen, I don’t think it’s fair to assume that’s not true, I think we need to dig into this and figure out if it’s true or not.”
Regarding the forged license, he said it would be very easy for a thief to convert the license to PDF and change it electronically.
Martin also defended Rathbun’s financial situation.
“Her company is still in good standing with the auction company, she has heated disputes with the two floor planners, she views them as shark lenders who charge exorbitant prices and add unacceptable fees so that she doesn’t cannot do business and make money using your services and she has an unfavorable relationship with them,” he said.
“Going back to my hearsay argument, we haven’t seen any district court collections from either of these companies, we haven’t seen a collection letter and neither of these companies, we don’t have anything from either of these companies that says they have an unpaid debt that they are suing, they will tell you they have substantial defenses if they try.”
Claiming the charges are serious criminal charges, Martin pleaded for the board to give Rathbun and Fitts time to gather evidence.
He added that the two already have a valid account to trade with AuctionACCESS and there would be no reason to try to create a second account.
Key words: license commission,