Treadz Auto complaints greater than police realized

Calgary police have launched an investigation into Treadz Auto in connection to 155 cases where people allege the company did not pay them after selling their vehicles.

Alberta Motor Vehicle Industry Council pulled company's licence in August

Romeo Orantes Gomez took Treadz Auto to small claims court for allegedly failing to pay him after they sold his vehicle for him, but the company has since gone bankrupt. (Mike Moynihan/CBC)

Calgary police say there are dozens of alleged victims in their investigation into Treadz Auto.

CBC News first reported in August that the car company was being accused of selling vehicles and not giving the money it owed to the owners of the vehicles. 

Police now say there are 155 vehicles that have been brought forward to them for investigation and about 120 victims, some of whom had multiple vehicles that they either purchased from or sold to the auto company.

Investigators say this case is very complex and likely won't be solved soon.

"We really do feel for the victims of this, it's a very difficult situation," said Sgt. Kristie Verheul with the economic crimes unit. "Economic crime takes a long time to investigate and it isn't always black and white. It does border on civil crime often."

Treadz Auto takes care of the showings and sales of vehicles for a consignment fee and consignment companies have 14 days to pay owners for their vehicles under Alberta law.

Clients say company never paid them

One man took the company to small claims court in an attempt to get the money he says they owed him after selling his vehicle but came up empty after the company claimed bankruptcy.

Romeo Orantes Gomez says the company sought him out after seeing an ad he had placed for his Camaro in Auto Trader. (Submitted by Romeo Orantes Gomez)

Romeo Orantes Gomez says the company sought him out after seeing an ad he had placed for his Camaro in Auto Trader.

He says the company offered to sell the vehicle for him but he discovered they had sold the car without telling him when he went back three months later.

Orantes Gomez said the company gave him cheques for the amount owed but the cheques bounced, so that is when he went to police.

Joanna Toller, another vehicle owner, says she sold her 2005 Audi to Treadz Auto. The company then sold the car for her in June for $12,000.

However, Toller told CBC News in August she had not seen any of the money — despite promises from the company that it was forthcoming.

Stronger regulations needed?

A CBC News investigation prompted calls from the Wildrose Party for stronger consumer protection regulations in Alberta.

Wildrose Service Alberta critic Bruce Rowe said the province may need to consider requiring higher bonds from consignment companies to ensure greater protection for consumers.

The Alberta Motor Vehicle Industry Council (AMVIC) has a compensation fund capped at $300,000 per business.

However, that won't be enough to cover everyone and some say that compensation wouldn't even begin to cover what they should have received for the sale of their vehicle.

"I'm hoping that there will be some resolution, that somehow, some way, I'm going to get my money out of this and not just a portion of it," said Andrea Scherle, who is says Treadz Auto sold her Dodge Ram in March but never gave her the money. "You know, $25,000 doesn't cover my [$45,000] loss. It covers half of it."

AMVIC says it has no plans to increase the cap on businesses in its compensation fund.

The regulator posted a statement on its website saying it had located some of the vehicles and is working with creditors.

However, those affected are being advised to keep all paperwork and consider seeking legal advice.

Anyone with concerns regarding Treadz Auto are being urged by AMVIC to contact their consumer services team at 1-877-979-8100 ext. 2002.

Customers should also contact the Calgary Police Service's non-emergency line at 403-266-1234 or go to any Calgary police office and quote file #14286151.

The provincial automotive regulator has cancelled Treadz Auto's business licence and the registrations of three salespeople connected to the business. The regulator says the company is now under investigation by police. (Google Street View)