IRS - Internal Revenue Service
08/20/2024 | Press release | Distributed by Public on 08/21/2024 06:42
Scrap metal dealer pleads guilty in multi-state catalytic converter theft conspiracy
Date: Aug. 20, 2024
Contact:[email protected]
Richmond, VA - A North Carolina scrap metal dealer pled guilty today to theft and tax charges related to his participation in a multi-state catalytic converter theft conspiracy.
According to court documents, Theodore Nicholas Papouloglou used his business, DG Auto South in Emporia, Virginia to purchase stolen catalytic converters from thieves. Papouloglou then transported the stolen catalytic converters to his co-conspirators in New Jersey for shipment of the catalytic metals to Japan. In 2020 and 2021, Papouloglou received over $12.2 million in wired payments from his co-conspirators in New Jersey, including for proceeds from his illicit sale of catalytic converters. Papouloglou spent the money he received from DG Auto South on personal expenses, such as purchasing real estate and a luxury motorcycle for his girlfriend and to gamble at casinos in Las Vegas. Despite realizing income from DG Auto South, Papouloglou paid no taxes in 2020 and 2021.
Papouloglou separately helped his co-conspirators in New Jersey to purchase stolen catalytic converters from other sellers, including sellers in Texas and Oklahoma, by facilitating bulk cash payments. The total value of the funds that Papouloglou illicitly transferred was at least $6.6 million.
Law enforcement seized and Papouloglou agreed to forfeit various vehicles associated with the offense:
- 2021 Ford F250 (Roush)
- 2021 Jeep Gladiator Sport (Apocalypse)
- 2017 Lamborghini Huracan (Convertible)
- 2020 McLaren 720s (Convertible)
- 2021 Mercedes-AMG G63
- 2019 Ferrari 488 Pista
- 2021 McLaren 765LT
- 2021 Ford F450 (Super Duty)
Catalytic converters, which reduce toxic gas and pollutants from a vehicle's exhaust system, use precious metals in their centers, or "cores," and are regularly targeted for theft due to the high value of these metals, especially palladium, platinum, and rhodium. Some of these are more valuable per ounce than gold, and the black-market price for catalytic converters can be above $1,000. A catalytic converter can be stolen from an automobile undercarriage in less than a minute.
Papouloglou is scheduled to be sentenced on Feb. 20, 2025, and faces a maximum penalty of 10 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Kareem A. Carter, IRS Criminal Investigation (IRS CI) Special Agent in Charge of the Washington D.C. Field Office; and Stanley M. Meador, Special Agent in Charge of the FBI's Richmond Field Office, made the announcement after U.S. District Judge David J. Novak accepted the plea.
Assistant U.S. Attorneys Avi Panth and Kashan K. Pathan are prosecuting the case. The Justice Department's Violent Crime and Racketeering Section assisted with the prosecution.
CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.