Killer clown case spawned auto career

There's always a back story. Terry O'Loughlin's goes like this:

It was 1990, and O'Loughlin had just joined the Florida Office of the Attorney General to handle securities cases.

But before he got his first securities case, he was assigned to audit a buy-here, pay-here store. The store owner's wife had just been killed.

The killer was someone wearing a clown costume, according to a South Florida Sun Sentinel online story dated April 12, 2018. When the wife answered her door, the clown, holding flowers and balloons, shot her in the face.

The husband was among the suspects, the story stated. As part of the investigation, the attorney general's office assigned O'Loughlin as the dealership's receiver.

The business engaged in illegal practices such as insurance fraud and odometer rollback, he said.

Less than a year later, O'Loughlin wrapped up his work with the dealership; the murder case went cold. But after that, complaints to the attorney general's office involving vehicle purchases were referred to him. And by then, O'Loughlin was hooked on the auto industry.

"I might be the only person who got involved with the auto industry through a murder," O'Loughlin, 64, now director of compliance for Reynolds and Reynolds Co., said with a chuckle. He is based in Fort Lauderdale, Fla.

O'Loughlin held the job at the attorney general's office for 16 years, and it prepared him for his position at Reynolds. He will celebrate his 13th anniversary at the dealership software company in February.

A well-respected expert in dealership finance and insurance, O'Loughlin is a fixture at dealer meetings, conferences and workshops that focus on dealership compliance issues.

He travels about 150 days out of the year.

He said it's gratifying to help dealers avoid falling prey to aggressive plaintiff counsels, class-action attorneys, attorneys general and the Bureau of Consumer Financial Protection.

"The car business is so heavily regulated," O'Loughlin said. Every dealership rooftop in the U.S. "has compliance costs of over $183,000, which translates into $2,500 per employee. There is tremendous burden placed upon them."

He also says that most dealerships do a good job with compliance. During his days as a regulator, his office audited over 100,000 transactions, and "less than one-half of a percent had anything wrong," he said.

Among his greatest achievements is being instrumental in drafting Florida's Motor Vehicle Lease Disclosure Act in 1994. Indiana passed identical legislation in 1995 before it was used by the Board of Governors of the Federal Reserve System and to revise federal Regulation M, governing the Consumer Leasing Act.

The legislation grew out of numerous customer complaints about lease contracts.

After going through 40,000 vehicle transactions, O'Loughlin identified "well over 300" instances of when consumers traded in vehicles and got no credit for them.

A deposed F&I manager called it "a pocket of profit," O'Loughlin said.

"Well, we negotiated monthly payment, and if the monthly payment isn't affected by the trade-in, whose problem is that?" O'Loughlin recalled the manager saying.

The auto industry was nowhere on the Pittsburgh native's radar when he earned his undergraduate degree with a double major in English literature and psychology at the University of Pittsburgh in 1978. He earned a Master of Business Administration and a law degree simultaneously at the University of Dayton in 1981.

"I really wanted to go into politics," said O'Loughlin, who also took some accounting courses at Allegheny College in Meadville, Pa.

Instead, in the mid-1980s, O'Loughlin worked as public accountant and later became vice president of a portfolio management firm.

In 1989, he moved his family to Fort Lauderdale, where he joined a pension management company.

About six months after he started that job, the company downsized, and O'Loughlin became a financial investigator with the attorney general's office.

Though the case dubbed "killer clown" by the local press was the most unusual case O'Loughlin worked on, there were others "that clearly stood out," he said.

For example, there was the F&I manager who duped customers into signing single-pay lease contracts by telling them they purchased their vehicles under two-payment retail installment contracts.

But, the second payment was actually the residual value of the vehicle, a much higher payment than the original contract quoted.

"Meaning at the end of the lease term, that the consumer all of a sudden was shocked by the payment they had to come up with to keep the car," O'Loughlin said.

"The finance manager went to jail for eight years, and we settled for $2 million on the case."

O'Loughlin was at the attorney general's office in fall 2005 when an ad in Automotive News caught his eye. The ad was for a compliance director at Reynolds.

"I had probably audited over 5,000 deal jackets at the attorney general's office over 16 years," he said. "I had seen the Reynolds name numerous times, and I had two young kids and college expenses. It paid better than my position at the attorney general's office."

O'Loughlin is on the go so much that when he has some downtime at home, he likes to relax by his pool, listen to sports on the radio and hit the gym.

"I don't want to go anywhere," he said, laughing. "I usually just relax and re-energize for my next trip."

Though no one has been convicted in the killer clown case, there's more to the story.

The buy-here, pay-here dealer, Michael Warren, was convicted on racketeering charges, sentenced to nine years in prison and released in 1997 for good behavior, according to a Nov. 2, 2018, online story by the Sun Sentinel.

In 2002, he married Sheila Keen, the former wife of a repo man who worked for Warren, the story said.

But in September 2017, 27 years after the killing of Marlene Warren, Michael Warren's previous wife, police arrested Shelia Warren, and she was charged with murder.

Shelia Warren pleaded not guilty. If convicted, she faces the death penalty, the story said.

As of early November, Michael Warren had not been charged, the story said.