The largest Porsche dealership in the U.S. has sued a former employee for allegedly defrauding customers of more than $2.5 million in deposits on special-order 911 GT3 and GT2 RS models that did not exist.
Copans Motors Inc., doing business as Champion Porsche in Pompano Beach, Fla., accuses Shiraaz Sookralli, the store's former vice president of marketing and a salesman who had been with Champion Porsche for 10 years, of a scheme in which he took 24 deposits for rare vehicles over more than a year and allegedly siphoned customer deposits into a private bank account.
The store's general manager said Sookralli stopped coming to work about a week before the dealership discovered the issue on Sept. 4. Law enforcement is investigating.
The lawsuit was filed Sept. 7 in Florida's 17th Judicial Circuit Court in Broward County against Sookralli and his wife, Vimla K. Sookralli, of Plantation Acres, Fla.; Devika Budhram of Plantation, Fla.; and Champion Autosport.
The litigation was reported last week by The Drive.
Copans Motors, in the lawsuit, alleges Shiraaz Sookralli and Budhram created a fictitious entity named Champion Autosport with a likeness of the dealership's name.
Shiraaz Sookralli presented potential buyers with fraudulent "buyer deposit agreements" and convinced them they were buying a Porsche from the dealership, the lawsuit alleged. But those agreements didn't include manufacturer or allocation information about the vehicles, contained false and fraudulent seller information -- therefore, Sookralli never ordered any vehicles, according to the lawsuit.
Tony Sciple, general manager of Champion Porsche, in a court filing said the dealership was in contact with Shiraaz Sookralli by email and identified 24 transactions "in his scheme to defraud the plaintiff and consumers." Sciple said Sookralli admitted to receiving $2,560,198, according to the filing.
The dealership said in the lawsuit that it learned about the alleged scheme as customers contacted the dealership about the vehicles. Sciple in the filing said Sookralli advised consumers to wire money to Champion Autosport at Bank of America and also accepted credit card payments.
"Shiraaz and Devika appear to have complete control of the account," according to lawsuit. "Although Shiraaz has communicated with the plaintiff via email and telephone, the plaintiff is currently unaware of his whereabouts."
A judge on Sept. 11 ordered a freeze on the Bank of America account for Champion Autosport and to provide Copans Motors' counsel with all transactions for the account from 2010 to present.
"We have been diligently investigating and dealing with the matter since. We had no records of the fraudulent deals and have been assembling documentation with the assistance of cooperative customers," Champion Porsche said in a statement on its Facebook page. "A civil lawsuit has been filed against the former employee, together with others who appear to have been involved in the fraud. Law enforcement has been contacted and we are fully cooperating with their investigation.
"We understand, and share in the outrage that this issue has caused. We are working diligently to investigate and confirm which customers were impacted and fully intend to stand by our customers to assist them. It is our intention to insure that each customer impacted by this matter receives the amount delivered to the fictitious entity under a fraudulent order."
Porsche in a statement said Champion Porsche made it aware of what it called an "unfortunate situation."
"Champion Porsche has assured us it will help Porsche buyers who might have been impacted and is asking those customers to give their information to Champion's legal counsel," a Porsche Cars North America spokesman said in an email to Automotive News.
A hearing has been scheduled for Thursday. Copans Motors is seeking to have funds returned to consumers. The dealership believes the money transferred to the Bank of America account then went to personal accounts.
It is suing for a full accounting of funds, unjust enrichment, unfair competition, trademark infringement, fraud and to stop Champion Autosport from conducting any further business. Copans Motors says the alleged scheme has hurt its reputation and cost it customers and is seeking damages, plus lawyer fees and other costs.
Shiraaz Sookralli, who has 10 children, allegedly suffered from financial troubles related to child support payments and money judgments against him, according to the lawsuit. American Express had recently garnished Sookralli's wages from Champion Porsche, the lawsuit says.