Used car salesman Bill Thompson believed that his idea to sell high-interest car notes online was a good moneymaker for him and his investors, until the Oklahoma Department of Securities put the brakes on his dealings.
“We didn't know we were doing anything wrong — it never even entered our heads,” said Thompson, who owns Triple T Motors at NW 10 and N Portland.
State securities regulators on Monday filed a lawsuit against Thompson seeking restitution for investors in the Oklahoma City-based online companies Invest in Car Notes.com and Buy Car Notes.com which lost hundreds of thousands of dollars.
The Oklahoma Department of Securities claims in its lawsuit that Thompson used at least some of the $500,000 he raised from investors to line his pockets — something Thompson firmly denies.
The companies lured investors by promising returns of up to 21 percent by investing in car notes for car buyers with less-than perfect credit. The proceeds from the notes financed car loans for customers at Triple T Motors and other used car lots, Thompson said.
“It was a good deal for everybody — it gave a person with bad credit the opportunity to buy a car.” Thompson said. “If a person wouldn't pay and the note went bad, we would put tracking devices on the cars so we could find them and then give (the investor) a replacement note.”
Invest in Car Notes ran out of gas when the Securities Department declared that Thompson had been selling unregistered securities and ordered him to shut down the business. He was forced to sell the car notes to a big lender for pennies on the dollar of what his investors had paid, he said.
Thompson's former business partner, Oklahoma City resident David Harris, could not be reached for comment. Harris, who runs the investment website ScamXposer.com, once touted Invest in Car Notes on the site as good place for investors to put their money. The endorsement has since been removed from the ScamXposer site. Harris is not named as a defendant in the agency's lawsuit.