Adam Weaver had been scheduled to go to trial Tuesday; the Rick Weaver dealership will enter a diversion program and stay open, lawyer says.
The government’s evidence in the federal fraud case against an Erie auto dealership included text messages, interviews with employees and documents seized with the execution of a search warrant.
That evidence won’t need to be presented at a trial.
The owner of the Rick Weaver Buick GMC Inc. dealership, Adam Weaver, will enter a plea, avoiding a trial that had been scheduled to begin with jury selection on Tuesday in Pittsburgh, his lawyer said Monday.
The lawyer, David Ridge, declined to comment on whether Adam Weaver will plead guilty or no contest and to what charges. No contest pleas are rare in federal court.
Weaver will join his co-defendants in the case, Adam B. Coover and Douglas A. Grooms, who pleaded guilty in the case Monday before U.S. District Judge David S. Cercone.
The lawyer for the Rick Weaver dealership, Michael Agresti, said the dealership will end its case by entering a pretrial diversion program.
“It’s a program that imposes some conditions on the company, but it is a positive outcome for the company because once we make it through those conditions and satisfy the court and the government’s requirements, there won’t be any criminal conviction against the company,” Agresti said.
He said the business will remain under the ownership of the Weaver family and will stay in business at 714 W. 12th St. The dealership is corporate defendant in the criminal case.
Agresti commented on the fate of the dealership after a plea hearing for Coover, a friend of Adam Weaver who owned his own car lot.
Coover pleaded guilty to a count of conspiracy to commit wire fraud and 12 counts of wire fraud, all felonies, in the Weaver case. Grooms, the dealership’s former general manager, also pleaded guilty Monday to the same charges in the case.
Both men are set to be sentenced March 19.
Weaver also faces felony counts of wire fraud and conspiracy to commit wire fraud. A superseding indictment in August added a count of wire fraud to the 13-count indictment that was originally filed in September 2016.
Weaver is free on a $10,000 unsecured bond.
The U.S. Attorney’s Office in Erie said previously that the three engaged in a loan scheme that used “straw buyers” to inflate the price of cars the Rick Weaver dealership was selling. The office said straw buyers defaulted on the loans, leaving banks and other lenders unable to recoup the cost of the loans.
Assistant U.S. Attorney Christian Trabold said in court Monday that Coover proposed the idea to Grooms in July 2015, suggesting that he would use a straw buyer to purchase a vehicle from Rick Weaver and he would then sell the vehicles at his business, Infinity Automotive LLC.
Coover told the first straw buyer that she would become a 15 percent owner of Infinity Automotive in exchange for conducting the purchase, Trabold said.
Trabold said Grooms informed Adam Weaver of the scheme “at or near the outset of the agreement,” and that Weaver became more involved later, when one of Coover’s checks bounced and he became indebted to the dealership for more than $80,000.
Text messages showed “Mr. Weaver becoming increasingly upset as Mr. Coover repeatedly stalled,” Trabold said, and Weaver eventually agreed to a plan in which a second straw buyer would purchase two vehicles at an inflated price without taking possession of them, with about $20,000 in profits going toward Coover’s debt.
Coover did not inform the straw buyers that he did not have the means to pay off the loans taken out for the vehicles, Trabold said.
Employees of the Rick Weaver dealership told FBI investigators that “everyone” knew the vehicles purchased by the straw buyers were going into Coover’s possession, Trabold said.
Coover also pleaded guilty Monday to involvement in a similar loan scheme in a separate case. He and another local auto salesman, Brian A. Vergotz, were indicted in the case in September 2016. Vergotz entered a not-guilty plea and is awaiting prosecution, according to court records.
Coover is being held in prison on a probation detainer out of Erie County Court.
Grooms on Monday also pleaded guilty in a federal bankruptcy case, court records show. He was indicted in May 2016 on a charge that he failed to disclose that he had $6,400 in cash to the Office of the U.S. Trustee, which is monitoring the Chapter 7 bankruptcy case he filed in U.S. Bankruptcy Court in Erie.
Grooms is serving a two-year sentence in federal prison for embezzling $485,000 from Community Chevrolet in Meadville between June 2008 and September 2013, before he started working for the Weaver dealership. Grooms pleaded guilty to a count of conspiracy to commit wire fraud in that case.
Trabold said Grooms initially agreed to the use of straw buyers at the Weaver dealership because he hoped Coover would help him pay off his restitution in the Community Chevrolet case.
Madeleine O’Neill can be reached at 870-1728 or by email. Follow her on Twitter at Media
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