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What Happened To Tax And Title Fees At Norco?

Norco Auto Group's Sanatoga showroom in mid-September 2008, before its closure.

Norco Auto Group's Sanatoga showroom in mid-September 2008, before its closure.

SANATOGA PA – Only two months after the sudden closure of its showroom at 2148 E. High St., in the heart of the village district, new controversy surrounds the Norco Auto Group Chrysler-Jeep car dealership. It and its owner, James Phillips, are among those involved in what is being called a vehicle fraud investigation to determine why taxes and title fees on some cars sold by Norco were not paid to the state.

The probe has left a small group of car buyers in motoring limbo. Their cars can’t be registered with the state Department of Motor Vehicles unless taxes and title fees are paid, and they can’t be driven legally without proper registration.

Phillips, in an interview Monday (Dec. 16, 2008), denied any wrong-doing and said he was cooperating with the investigation being conducted by the Pennsylvania State Police based in Skippack. “Norco Auto Group didn’t do anything wrong,” Phillips said. “I’m not about to, at this stage of my career, start hurting customers. I’m going to continue to work very diligently to get this situation rectified.”

A third party central to the investigation, Chrysler Financial Corp., so far has not responded to requests for comment.

The investigation focuses on what appears to be more than a dozen cars purchased from Norco between April and October 2008, according to Trooper John D’Orazio of state police Troop K. Although state taxes and title fees were collected on behalf of the buyers, D’Orazio said Monday, those monies have not been received by the state. No charges have been filed.

Additionally, D’Orazio added, some vehicles traded to Norco for new ones may have had outstanding debt – called a lien – that has not been paid to lenders.

  • D’Orazio is trying to determine the scope of the problem by reaching out to the public. “I imagine there are more” buyers affected, he said. “If they bought a car from Norco” during the seven-month period, “and they still have a pink sales slip but no car registration, they’ve got a problem.”
  • The trooper asks those concerned to call him at 610-410-7854. When calling they should have ready their car license plate number, vehicle identification number (VIN), proof of insurance, date of purchase, and the name of the financial institution that handled their car loan.

Phillips blames Chrysler Financial, which he claimed controlled his company’s finances during the period, for failing to make the missing payments. A Chrysler Financial representative, who Phillips said occupied a desk in the showroom since April, allegedly had final approval power over which of the dealership’s bills were paid. “The problem lies solely with Chrysler Fianancial,” Phillips added. It had “complete control of the bank accounts. They completely shut me down.”

D’Orazio confirms Chrysler Financial appeared to be in “full control” of Norco finances at the time, but noted that it blames Norco for failing to pass payments on to the state. Phone calls and e-mails currently boil down to a we-said-they-said trade of accusations, according to the trooper. “We’re nowhere near the bottom of it yet,” D’Orazio said.

Phillips estimates his dealership sold about 300 cars in the seven-month span, the majority of them financed by Chrysler Financial. The missing payment problem, he said, appears to affect only buyers who financed their cars through outside lenders, such as a bank or credit union.

Ironically, Phillips – who is an elected member of the Lower Pottsgrove Township Board of Commissioners – himself is one of the affected purchasers. “I bought a car from my dealership at the time,” Phillips said, and financed it elsewhere. Taxes and title fees allegedly were not paid on that purchase either. “I’m one of the victims here,” he said.

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