Texas auto dealer arrested during his auction

Old Cars Weekly reporter Greg Riley was on the scene of a car auction-turned-crime bust on Saturday, June 27. Texas authorities arrested three and impounded 56 cars. Note that charges have been filed but no one has been convicted. The case is under investigation.

Read Riley's firsthand account of the event...

By Greg Riley

Beginning early May, Israel Curtis Auctioneers advertised a sale of vehicles, equipment, farm and ranch items at the business of Leslie W. Shipman, 54, located at 125 College St. in Anderson, Texas, to be held on June 27, 2015. Shipman’s business was later identified as Hot Rods. This sale was advertised as a one-day event and total liquidation of all property, including more than 50 vehicles belonging to Shipman.

Among the vehicles advertised was a 1965 “Pony Coupe” Mustang, 1965 Chevy “restored pickup,” 1958 Ford pickup, 1948 Chevy Sedan, 1965 Chrysler Imperial, 1971 Camaro, Valiant Scamp, three Military 6X6’s, Harley-Davidson, and “several other antique autos.” It was further stated, “This is an excellent opportunity to acquire classic vehicles, cars and trucks, equipment for your farm and ranch.”

A long list of items offered was featured in the pre-auction advertisement along with a link to numerous photos. These included military vehicles, heavy equipment, welders, farm and ranch items, antique furniture and guns, and shop equipment. Approximate one-third of the ad outlined the acceptable forms of payment and disclosures concerning buyer’s premiums, and other terms of sale. Nothing in the ad discussed vehicle titles.

Your reporter became aware of the auction the evening before and decided to attend on the spur of the moment as a Saturday morning outing. Upon arriving at 8:45 a.m. the crowd was already quite large and diverse. A quick inspection of the cars revealed that many were in poor cosmetic and mechanical condition with many visible flaws. The auction site was in poor condition and strewn with debris of all kinds. Auctioneer Curtis stated that his employees had spent a week sorting item and discarding things deemed unsaleable.

Curtis stated repeatedly that all vehicles except two had clear negotiable Texas titles. Those two vehicles had bonded titles. A Texas bonded title is a legal mechanism whereby an untitled vehicle or having other title issues can be issued a negotiable Texas title by posting a surety equal to 1.5 times vehicle value. Mr. Curtis further stated that all titles would be handled at a table manned by Jerry R. Williams, 79, from Houston who Curtis later represented to Old Cars as a licensed auto dealer.

Several morning hours were expended selling numerous small lots that brought anywhere from a few dollars to several hundred dollars. Just prior to noon it was announced that a large bull dozer would be sold next at another site approximately two blocks away, and vehicle sales would commence shortly thereafter. At a little after 1 p.m. cars began moving past an impromptu auction block. It was apparent that virtually all had some degree of mechanical problem.

Although the crowd numbered over 100, the bidding was tepid, with each passing lot Mr. Shipman became more and more agitated. He and Mr. Curtis had several whispered conferences. At one point Shipman threatened to stop the auction, and shortly thereafter Mr. Curtis began to engage in questionable auction practices. These included pretending to get an opening bid and starting the auction at what seemed a pre-determined figure. On one occasion Curtis hammered a vehicle sold and said, “I bought that one.” On several another lots Shipman said, “I won’t sell it for that” and the lot was removed. On other occasions, buyers offered opening bids which the auctioneer refused to recognize.

After numerous “used-car” lots, the auction turned to the collector vehicles. The “Pony Coupe Mustang” was in reality a base-line six-cylinder automatic car that was incomplete and in very poor condition. Shipman appeared very upset at the opinions being voiced by the crowd and the opening bid of only $500. This lot was also unsold.

The 1949 Chevrolet had obvious collision and extensive corrosion damage, also with almost no bidder interest. The 1971 Camaro was actually a 1976 Type LT in bright Orange with a rare houndstooth interior, but it also had extensive rust damage and many missing components. An acquaintance had come to bid on the 1965 Chevy “restored pick-up.”

The auctioneer stated that Mr. Shipman wouldn’t accept anything less than $7,000. Our acquaintance asked if he could make a lower opening bid, and was told no. At that moment four law enforcement agencies descended on the property, and blocked all driveways. Mr. Curtis and Mr. Shipman were told the auction was to stop immediately, pending a review of the title paperwork, and that the Montgomery County Auto Theft Task force and the Grimes County Sheriff’s Office had a search warrant, and that the Texas Department and Licensing and Regulation wanted to speak with Mr. Curtis.

We followed the law enforcement officers into the building and observed them impounding all of the vehicle titles and photographing everything at the auction office. Auction patrons who had placed winning car bids were asked to remain on premises so that statements could be taken and to ascertain if funds had changed hands.

Mr. Shipman was proclaiming loudly that people in government wanted him off that property, there was a plot to ruin him, and that his records had been examined repeatedly and nothing illegal had ever been found. He further stated he had paid over $1 million in Grimes County taxes. After a considerable unchecked outburst, Detective Lieutenant J.E. Sclider of the Montgomery County Auto Theft Task Force informed Mr. Shipman that he was interfering with an official investigation and was subject to immediate arrest if his outbursts continued.

After investigation Curtis, Shipman, and Williams were arrested.

Based on the review of the records 56 vehicles were seized along with all the title paperwork. Detectives further learned Williams was transferring open titles to the new buyers at this location. This act constituted Tampering with a Government Record and the charge of Engaging in Organized Crime, 2nd Degree Felony, was added to all individuals involved. Further, the auctioneer was arrested for practicing without a license (Class B Misdemeanor).

All arrested parties were taken to the Grimes County Sheriff’s Office in Anderson. Bond amount on the Engaging in Organized crime was set at $10,000.

During a follow-up conversation, Mr. Curtis stated that he didn’t know that his auctioneer’s license was under suspension, and upon his release from jail had contacted the state board and brought his license into compliance. He also said that it was his understanding that Shipman had ownership of all vehicles and that Mr. William was a licensed motor vehicle dealer and Shipman’s partner in his vehicle endeavors. Mr. Curtis states that he has been in the auction business for over 30 years, and during that time had one complaint lodged.

Lt. Sclider tells Old Cars that Shipman’s operation had been under observation for a considerable period of time and there is likelihood that he was operating an unlicensed motor vehicle dealership for two years. Furthermore there is suspicion that many of the vehicles may have been obtained via fraud. Despite Curtis’ statements, many of the vehicles had “open” titles whereby an unlicensed dealer “jumps” title. Texas law says title must be in the seller’s name unless seller is a licensed dealer with a GDN (General Distinguishing Number.)

56 vehicles have been impounded by the Grimes County Sheriff’s department while titles are researched and factual ownership is ascertained. Lt. Sclider said, “All of the suspected vehicles seized, were taken to the Grimes County Sheriff’s Office until rightful ownership of the vehicles could be determined.”