(WMC TV) - A police report revealed a car-buyer intends to press theft charges against the son of a woman who is fronting used car sales from her home for a dealership, a practice called "curb stoning."
Bill Sullivan filed a complaint with the Germantown Police Department May 23. The complaint alleged he gave $4,500 to Thomas Coleman, son of Deborah Coleman, 2164 Wilderness Cove, to purchase three vehicles.
When their delivery was delayed, Sullivan pressured Coleman to produce the cars' sales documents. Once Coleman finally presented the sales documents, Sullivan said they revealed something else.
"The cars were never purchased by them on my behalf," Sullivan said. "They were purchased by somebody else."
According to the sales documents, that "somebody else" was The Auto Connection, an auto dealership at 1419 E. Broadway St. in West Memphis, Arkansas.
Sullivan's police report alleged Coleman pocketed his $4,500 and never purchased any cars with his money. The cars the Colemans claimed to have purchased with his money, Sullivan said, were actually cars they sold on behalf of The Auto Connection.
"Correct," Sullivan acknowledged. "They split the profits."
"Somewhere between 80 and 90 percent of (auto sales) classified ads are believed to be curb stoners," said Carfax's Chris Basso. "These are dealers posing as private sellers that are selling cars that have a lot of hidden problems."
Coleman has posted numerous listings for used car sales on CraigsList, all found while running searches based on her cell phone number.
Kayce Wyatt of Arlington, TN, answered one of Coleman's ads for a 2001 Nissan Maxima, thinking Coleman was the vehicle's private owner putting it up for sale.
She met Coleman at Coleman's home. That's where the car was stored, Wyatt said.
After taking a test drive and negotiating the deal -- but failing to run a Carfax report or to have the car inspected -- Wyatt paid $3,500 for the car, according to the paperwork.
It's when Coleman handed Wyatt the title that Wyatt realized something was up.
"I got the title, and it said, 'The Auto Connection,'" Wyatt said.
The dealership, owned by Jimmy Smith, is licensed with the Arkansas State Police to sell used cars in Arkansas.
But according to the records of the Tennessee Motor Vehicle Commission, The Auto Connection is not licensed to sell cars, new or used, in Tennessee.
It wasn't long until Wyatt started having trouble with the Maxima. The "Service Engine Soon" light stayed on. The radio's power switch malfunctioned. The brakes, pads, rotors, spark plug and oxygen sensor had to be replaced.
She nearly paid as much to repair the car as she did to buy the car.
If she had run a Carfax report, she would have discovered The Auto Connection had Deborah Coleman 'curb-stone' Wyatt a car -- that had been in an accident in Michigan.
Neither Coleman nor The Auto Connection disclosed the accident to Wyatt.
"So it's been wrecked," Wyatt said. "I cried and cried and cried about it, but I had to do what I had to do. I didn't have a way out of it."
An undercover producer of The Action News 5 Investigators answered one of Coleman's ads for a Volkswagen Jetta. The test drive revealed the "Service Engine Soon" light was on.
"That's because it's due for an oil change," said Coleman to our producer. A Carfax report revealed nothing of concern with the vehicle's history.
Both the Jetta and a Cadillac Coleman was selling outside her home had Arkansas dealer temporary tags. When our producer asked about the out-of-state tags, Coleman admitted she was selling the vehicles for The Auto Connection.
"(The) business is over in Arkansas, and it just saves all the (document) fees, and it saves me about $1,500-1,600 dollars per car," said Coleman, who is also not licensed to sell automobiles in Tennessee, according to state records.
According to the Tennessee Code Annotated, 55-17-109, "...it is unlawful for any person to engage in business as..a motor vehicle dealer (or) motor vehicle salesperson...without first obtaining a license as required in this part..."
"Tennessee law says that if you sell more than five vehicles in a year, that you have to have a dealer's license," said Basso. "These are people that are skirting that law, selling hundreds of cars without getting a dealer's license, costing the state and local dealers hundreds of thousands of dollars (in tax revenue)."
Coleman refused to answer our questions when we confronted her. Smith agreed to an on-camera interview, then abruptly canceled the interview the next day.
On the phone, he said, "(Coleman) is my agent. She sells cars for me. Sometimes, it's from her own driveway. Sometimes, it's from a (drug store) parking lot. She's just trying to feed her kids."
Germantown police department records revealed another car-buyer reported Coleman in December 2010.
According to the complaint, the buyer blew the whistle on Coleman after he said he witnessed her and her son alter a temporary drive-out tag on a vehicle. Coleman told the police officer who wrote the report that she sold the car on behalf of Star Auto Mart, 156 E. Highway 72 in Collierville, TN.
"No, sir," said Star Auto Mart's owner David Fleming. "She's never sold for me. Never had a salesman's license here. Never anything."
Germantown police determined there wasn't enough evidence to charge Coleman with a crime and decided it was a civil issue.
"It's a lose-lose situation with curb-stoning," Basso said. "The state loses money. The (licensed) dealers lose money, and the consumer gets ripped off.
"If you're looking online, especially through sites like CraigsList, you really need to be careful about what you're buying."
Coleman's curb-stoning operation may be in violation of a Germantown city ordinance. It prohibits "...receiving persons at a residential property for the purpose of buying, selling, ordering or picking up products in connection with a business."
"Code compliance has had contact with (Coleman) in the past," said Stacey Ewell, spokesperson for the city of Germantown. "We did provide notice for unlicensed vehicles in the street in November of 2010 but have not had anything vehicle-related since. In addition, there is no business license for (2164 Wilderness Cv.)."