Man Sentenced to 80 Months in Multi-Million-Dollar Mail and Wire Fraud Scheme
MEMPHIS, TN—A luxury automobile salesman has been sentenced to 80 months for operating a scheme that defrauded individuals of more than $2 million.
According to the indictment, from October 2010 to September 2013, Michael Brown offered upscale automobiles for sale through his business, Valkry Corporation. However, once he received payments from customers, Brown used the funds for personal benefit and failed to fulfill vehicle orders.
For nearly three years, Brown would partially satisfy order requests, or fail to deliver the vehicle(s) at all, according to the indictment. Brown would use the funds for personal endeavors, as well as travel and business expenses. He also used the funds to purchase additional vehicles, which he advertised to new customers. As a result of his scheme, Brown fraudulently obtained $1,984,803.
One victim of Brown’s scheme over that period is M Super Car, an international luxury automobile dealership based in Macau. In October 2010, M Super Car placed an order with Brown for the purchase of multiple vehicles for $1,268,000, according to the indictment. The dealership made multiple wire transfers from its bank accounts to Valkry Corporation’s First Tennessee accounts to purchase 16 Mercedes-Benz vehicles and a customized Porsche. However, Brown failed to fulfill the company’s order or refund their money for the cars he was unable to deliver.
England-based company KIS Cars, LTD. is another victim of Brown’s scheme. In November 2012, KIS Cars placed an order with Valkry Corporation for four Mercedes-Benz sedans and four Porsche Cayennes. The company paid Valkry Corporation for the orders via two wire transfers, one in the amount of $64,886 and another for $522,404. However, Brown failed to fulfill the orders and only provided a partial refund of $20,000 to KIS Cars.
In August 2013, Leonard Wright negotiated the purchase of a 2014 BMW 650i from Brown for $102,721.57. Wright financed the purchase through Orion Federal Credit Union. Although Brown received a check satisfying his asking price for the BMW, he failed to deliver the car to Wright.
Brown pled guilty to two counts of wire fraud and one count of mail fraud in February 2015. Following his plea, Brown continued his scheme. One of the people he managed to defraud was legendary basketball player Julius “Dr. J” Erving. In February 2015, the former NBA star wired Brown $251,934.13 to purchase a 2015 Rolls Royce Wraith. Nevertheless, Brown failed to fulfill Erving’s order or provide him with a refund.
On Tuesday, July 28th, Brown was sentenced to 80 months by U.S. District Judge S. Thomas Anderson.
The case was investigated by the Federal Bureau of Investigation.
Assistant U.S. Attorney David Pritchard represented the government in this case.