CAMDEN, N.J. (CN) - A family of Russian car dealers has defrauded "former compatriots" for nearly a decade by offering used cars from the United States on "slick Internet websites" but never delivering them, 13 people claim in court.
Ardak Akishev et al. sued Sergey Kapustin, Irina Kapustin, Michael Goloverya aka Mikhail Goloverya, four other people and eight entities in Federal Court.
"The plaintiffs in this case are citizens of the former USSR Republics who attempted to fulfill their dream: to own a gently used car from the United States, one that traveled on roads with no potholes and was maintained by qualified mechanics. They believed they could trust a car dealer from the United States because of how tightly they are regulated here, as opposed to the market back home," the complaint states.
The defendant Russian expatriates Sergey Kapustin, Irina Kapustin and Mikhail Goloverya, Irina's son from a previous marriage, own three New Jersey car dealerships that have "several slick internet websites" catering to citizens from their former homeland across the pond, according to the 75-page lawsuit.
On these websites, one of which is completely in Russian, the Kapustin family has posted photos of used cars, discusses their delivery through a port in Finland, and on its website GlobalAutoUSA.com, how cars from the United States can be a "reality for everyone."
"A number of the vehicles advertised for sale on GlobalAutoUSA.com and EffectAuto.com do not actually belong to any defendants," the complaints states. "Instead, the Kapustins use images of cars and information about them gathered from other online car sales sites to advertise these vehicles as 'bait.' They set the price point just below the market value and explain that they do so because they are a wholesaler.
"Once contacted about purchasing the vehicle, the Kapustins and their agents issue invoices from G Auto, Global, or Effect requesting defendants to wire money to their bank accounts."
The defendants then send an invoice for the sale contract, which does not contain required information, such as the odometer reading or warranty disclosures, the plaintiffs say.
"After buyers wire the money, the delays begin. The buyers are given the silent treatment, then various excuses, such as inexplicable 'difficulties with delivery,' lost paperwork, accountant going on vacation. The buyers are reluctant to ask for a refund, since that means paying substantial cancellation penalty and waiting until the car resells, as stated in their invoices." Then the Kapustins try to weasel more money out of their suckers with the second part of their scheme, according to the lawsuit.
"Months later, the Kapustins offer the buyer a different, often an inferior car, for just a few thousand more. Buyers - by then desperate to get anything at all out of this deal - wire additional money. Some victims in this case made as many as three wire transfers to the Kapustins. They are still waiting for the vehicle or a refund.
"In the end," the complaint states, "most buyers receive no vehicles at all, nor do they get their money back. A few receive flooded or salvaged vehicles that were sold as 'new' or in 'good condition.' This scheme goes back at least 8 years; it involves hundreds of victims; and an estimated average wire amount per transaction is about $20,000. The victims face language barriers; they cannot easily access U.S. courts and consumer protection agencies, so this fraudulent scheme has continued unfettered for years."
The plaintiffs seeks damages for RICO violations, fraud, violation of motor vehicle advertising regulations, breach of contract, conspiracy, conversion, unjust enrichment, piercing the corporate veil, breach of faith, violations of consumer law, breach of warranty and libel.
They are represented by Anna Brown in Cherry Hill, N.J.
Also named as defendants are Vladimir Shteyn aka Vladimir Shtein ,Igor Zadorozhniy aka Yegor Zadorozhniy, Michael B. Campagna, Michael Hitrinov aka Michael Khitrinov, G Auto Sales Inc., Global Auto Inc., Effect Auto Sales Inc., Global Cars Inc., SK Imports LLC, Empire United Lines Co., CarCont Ltd. and Global Cargo Oy.
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