- Former car dealer Andy Gabler is convicted on Thursday in a federal fraud case
- Gabler wants a sentence of no more than house arrest
- According to US prosecutors, Gabler earns up to five years and three months in prison on a new file
- Gabler was implicated in “terrible duplicity” by defrauding the bank, claiming other $ 1.5 million victims, prosecutors say
Former Erie car dealer Andy Gabler, who pleaded guilty to a federal fraud case, downplayed the gravity of his crimes by asking a judge to keep him out of jail at a trial next Thursday.
To keep his Lakeside Auto Group from going bankrupt for as long as possible, Gabler’s attorney said in a January verdict that Gabler defrauded a bank and other victims of about $ 1.5 million.
Gabler, the attorney said, was a well-meaning businessman and charitable supporter who “robbed Peter to pay Paul.” He said Gabler, whose reputation has already been ruined, should be given parole or no more than a year of house arrest.
The US prosecutor in Erie advocates a very different punishment.
The office wants Gabler, 52, to be sent to federal prison for a minimum of four years and three months and a maximum of five years and three months – the recommended area under the sentencing guidelines in this case.
“Gabler repeatedly claims in his pleadings that he only robbed Peter to pay Paul,” said US deputy attorney Christian Trabold in his conviction record filed with the US District Court in Erie on Wednesday.
“He really robbed Peter to pay Andy.”
“A suspended sentence or home incarceration,” Trabold said, “will send the wrong message across to the community that crime pays and employees will receive preferential treatment in federal court.”
Trabold characterized Gabler, a resident of Harborcreek Township and owner of the former Lakeside Auto, as greedy. Trabold said in his memo that despite his company’s financial troubles, Gabler was getting a salary of $ 187,200 a year and his wife “paid over $ 80,000 a year for a no-show job that she only did once or twice a month worked. ” most.”
Gabler, Trabold said, was involved in “a huge fraud program that he invented to keep his business open and keep his salary flowing.”
“Simple, old-fashioned greed,” Trabold described the behavior. “Gabler didn’t care who got hurt as long as his deal stayed open.”
Please take a long break:Car dealer Andy Gabler wants house arrest on $ 1.5 million fraud, says Ruf already ruined
U.S. District Judge Susan Paradise Baxter will weigh up the competing characterizations of Gabler on Thursday as she decides what sentence to apply. She will also convict Gabler’s former finance manager Chad Bednarski, 49. He also pleaded guilty and faces a penalty ranging from three years and five months to four years and three months.
Like Gabler, Bednarski applies for house arrest. In another sentencing protocol, Trabold asked Baxter to sentence Bednarski to prison terms within the scope of the policy.
Both Gabler and Bednarski are free for unsecured bonds.
“Colossal” pause unjustified
Gabler and Bednarski each face a maximum legal sentence of 30 years in federal prison and a fine of up to $ 1 million, though the guideline penalties are far lower. The federal sentencing guidelines consider factors such as whether a defendant has a prior record or plead guilty.
The guidelines for sentencing are recommendations rather than rules that federal judges must follow and give Baxter a broad discretion on Thursday.
But Gabler’s attorney, Elliot Segel, also admitted in his verdict that Gabler is aiming for a “monumental downward movement” by asking for a jail sentence. Trabold said in his verdict that Gabler was “not entitled to such a colossal downward deviation” from federal condemnation guidelines.
Gabler “wasn’t stopped until his business was received,” said Trabold. “Gabler kept his betrayals hidden while introducing himself to the community as a philanthropist. His terrible duplicity is no harbinger of rehabilitation success.”
Confessions of guilt:“Variety” of fraud in the case of car dealers
Gabler and Bednarski each pleaded guilty to a fraud conspiracy in September for stealing $ 1.5 million between January 2015 and January 2019, when Gabler’s company was under court order. The two were charged in August 2019 with practices related to practices at Gabler’s now-defunct Lakeside Auto Group dealership, which had locations in Harborcreek, North East Township and Girard.
The two were charged with a variety of illegal activities, ranging from reporting fake vehicle sales to submitting fake information on credit documents. Bednarski was a finance manager at Lakeside Auto Sales and Lakeside Chevrolet, another dealership owned by Gabler. The companies sold used and new cars.
Gabler’s business fluctuated in January 2019 when the FBI received information from employees that Gabler’s dealers were in “significant financial hardship,” Trabold said at the hearing for Gabler and Bednarski. He said the banks had also told the FBI that they believed Gabler’s dealers were involved in the fraud.
The FBI investigation led to charges that Gabler and Bednarski sold vehicles “out of trust” or did not use the proceeds from the vehicle sale to pay off bank loans known as “floor plan debts”. The indictment alleged that Gabler and Bednarski failed to inform their lender, S&T Bank of Indiana, Pennsylvania, when they sold vehicles that were bought with “floor plan financing.”
The failure to report the sales allowed dealers to delay or avoid making required payments to S&T Bank for the vehicles sold, the government said. In such situations, banks cannot get the sold vehicles back to get credit back because a dealer has already transferred ownership of the vehicles to the new owners.
In his 38-page conviction record, Trabold reviewed how Gabler defrauded S&T Bank. He explained how Gabler sacrificed his company’s customers by selling them extended warranties but not sending the payments and documentation to the extended warranties company. Gabler kept the money, Trabold said, not letting customers “know they didn’t have an extended warranty that they paid for”.
The FBI was gathering evidence of “415 guarantees Lakeside sold to Lakeside customers and then never sent the money,” Trabold said. He said customers paid a total of $ 233,267 for the guarantees.
The abuse of guarantees, Trabold said, showed that Gabler’s crimes had victims. Trabold responded to Gabler’s characterization in his statement of judgment that he paid for the guarantees when a customer made a claim on the guarantees. Segel, Gabler’s attorney, said in the statement that the guarantees were eventually all paid after Gabler’s business was received in January 2019.
“Obviously, when a customer paid for something they didn’t receive, they became a victim,” Trabold said in his memo. “These customers don’t care if Gabler used their money to keep his failing business going, or if he played it or drank away. They were still paying for something they didn’t receive, so it became obvious cheated. “
Contact Ed Palattella at [email protected] Follow him on Twitter @ETNpalattella.