Used car dealership accused of defaulting on loan, pocketing payments from customers

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WJZY/Bill Melugin

A Charlotte used car dealership is accused of defaulting on a loan, yet still trying to collect payment from customers and sell vehicles on its lot. Customers suspect Auto City LLC is trying to sell off its inventory and pocket their payments, rather than pay off its business loans.

Customers of Auto City, located at 4700 Independence Blvd., reached out to FOX 46 after they received a troubling letter about the dealership in the mail from an attorney in Georgia.

“We had bought two cars from Auto City earlier this year, we needed to rebuild credit after the economy, and after I got the letter in the mail I was shocked, I wanted to cry,” one customer, who requested anonymity, told FOX 46. For the purpose of this story, she will be called “Holly”.

The letter was from a law firm representing Dealers Captial Inc (DCI) a creditor of Auto City, based out of Roswell, GA. According to the letter, Auto City has defaulted to DCI, and the dealership longer possesses any of the contracts or titles for the vehicles they’ve sold. The letter said that Auto City was no longer the correct party to send payments to, and all future payments needed to be sent to DCI, now in possession of the contracts and titles.

“So I called Auto City, at first thinking its some kind of a scam going around,” Holly said.

She said an Auto City rep told her over the phone that the issue was being worked out, but couldn’t give a clear answer on what to do with future payments.

“She said ‘well we’re leaving it up to our customers, whoever they trust, if you trust us, you can pay us, if not, it’s okay to pay them’” Holly said. “She told me Auto City was going to close down, and when I asked her why they were still advertising on Facebook, she kind of fumbled and put me on hold.”

Shocked by Auto City’s reaction, Holly and her husband called the attorney who sent them the letter.

“He explained to me that [Auto City] had been defaulting on hundreds of loans and pretty much that they no longer own the titles of our cars,” Holly said. “He did stress that it was in no fault of our own, because we had been current with our payments.”

FOX 46 Charlotte spoke with that attorney and obtained the lawsuit that DCI has filed against Auto City is Fulton County, GA, where they are suing Auto City and its registered owner, Evgenni Desiatnikow, for breach of contract.

The lawsuit accuses Auto City of owing DCI $729,149 for failing to repay a loan.

Auto City has a F rating with the Better Business Bureau, and it’s not BBB accredited.

BBB records show that Auto City has failed to respond to numerous customer complaints, and never responded to a BBB request to meet about the issues this summer.

Public records show Desiatnikow was charged in Mecklenburg County this year for improper use of dealer plates, and expired tags.

When FOX 46 investigative reporter Bill Melugin called Auto City’s title and accounting department, he was told a manager was helping a customer, and that he would return his call. Nobody ever called back, so Melugin and a photographer stopped by the business to get some answers in person.

A man who identified himself as an employee of the business called the allegations a joke, and walked away when FOX 46 began to ask him questions.

Auto City continues to solicit Holly and her husband for payment, despite allegedly no longer owning their contracts.

“They email us almost every day, and they’ve been leaving us voicemails,” Holly said.

On top of that, the dealership continues to sell vehicles on its lot while advertising 100% credit approval.

“They’re just collecting as much money as they can before they check out,” Holly’s husband said.

The couple says, they don’t know what to do next.

They refused to pay Auto City if it’s defaulting and possibly going under, and they don’t want to pay its creditor until the lawsuit is resolved.

To date, they’ve made more than $11,000 worth of payments to Auto City, and they’re nervous about what’s going to happen with those payments.

“You’re paying a significant portion of your income to two vehicles, just expecting another company to uphold their end of the bargain, and obviously when it doesn’t happen, yeah, you get very angry,” Holly’s husband said.

At least check, Auto City hasn’t filed a response in court to the lawsuit filed against them.

The couple tells FOX 46 they won’t make any new payments to DCI until they get a guarantee in writing that they will get the vehicle titles once payment is finished.