A great deal of money tends to change hands at a luxury automotive dealership. In most cases, this exchange is completely legal, but for Patricia Smith and family of Baierl Acura in suburban Pittsburgh, Pa., things ran afoul of the law. Luxuries including VIP seating at exclusive events, private lunches with celebrities and autographed memorabilia were just a small part of a seven-year, $10 million-plus embezzlement scheme.
Controller makes 800 personal money transfers
According to records in the case, Baierl Acura controller Smith, 58, transferred company money to her personal bank account 800 times over a seven-year span, amounting to embezzlement in excess of $10 million. She admitted to falsifying dealership inventory records and bank statements in order to cover her tracks. In order to explain her lavish new lifestyle that involved gifts of houses and cars for family, Smith claimed she’d hit big with an airline stock purchase and made good money as an online travel agent.
Spending run amok
Running a successful Acura dealership no doubt has its legal perks, but Smith reportedly went to extremes while reveling in the benefits. On top of an annual salary of $53,000, Smith spent $1.8 million on private jet charters, regularly traveled the globe and dropped $44,500 on Super Bowl seats. That was reportedly just the beginning. Purchasing massive homes and multiple vehicles were also common activities. On average, Smith took $4,000 per day from Baierl Acura, seven days per week for seven years.
In May, a federal judge sentenced Smith, who pleaded guilty to wire fraud and had cooperated with investigators, to 78 months in prison. Her prison term is set to begin in July.
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Taking like it’s Christmas
Court records indicate that Smith’s embezzlement activities began in December 2004, when she electronically transferred money from a Baierl Acura account into a company payroll account, then from payroll into her personal bank account through a bank outside Pennsylvania. After doctoring the company’s books and distributing fake bank statements to Baierl Acura’s auditors, everything appeared legitimate. Vehicle inventory reports, loan documents and reserve account balances were also altered to appease an unsuspecting management.
It wasn’t until July 2011 when Smith quit her job after receiving an email that questioned her accounting that the U.S. Attorney’s office got involved. No charges were pursued against Smith’s family, although they did agree to forfeit much of the property, jewelry, gold coins and other goods bought with embezzled funds. Smith was ordered to repay Baierl Acura $10.3 million, although only about $1 million is expected to be recoverable immediately.
“We’re glad that justice has been served and this matter is now behind us,” said dealership president Lee Baierl via a statement. “Despite the amount of funds taken over time, there were no adverse impacts to our daily operations. Our business is doing well, and we have adopted stronger measures to prevent such a crime from ever occurring again.”