A Chevrolet dealer in Davenport, Iowa will be sold back to General Motors before the first of the new year, following a lawsuit in which the automaker accused the dealership of carrying out fraudulent sales of new vehicles to its network of used dealerships in order to receive thousands of dollars from General Motors‘ “Standards for Excellence” program.
According to Automotive News, the Gurley Leep dealer group operates 9 dealerships in Northern Indiana, and another 12 stores in Iowa, plus a Michigan-based Honda dealership. General Motors alleged that the group carried out a practice dubbed “Daisy-chaining,” wherein the Chevrolet dealership would transfer new vehicles to its non-GM used car stores for resale, and report those vehicles to General Motors as customer sales to maintain the appearance of strong sales performance.
The suit was filed back in January, 2013. One example of the practice in-action is an instance from late 2012, where an employee from an affiliated dealership purchased 27 new vehicles from the Davenport, Iowa Chevrolet dealer in a span of less than 2 months. “Suspicious” sells that act a little short.
Automotive News has also reported that many of the “like-new” Chevrolet vehicles which emerged at other affiliated dealerships still had Leep Chevrolet vanity plates and plastic seat-wrapping intact.