Stellantis has been awarded more than $5.4 million in a lawsuit against Sky Auto Mall after the dealership failed to respond to the case involving allegations of breach of contract and fraud.
The details: The judgment was awarded by default to Stellantis Financial Services after Sky Auto Mall failed to respond to the case, according to NBC Channel 7 KWWL.
Under the ruling, Stellantis’ financial arm was awarded $4,819,550.42 in principal and $750,265.83 in interest and fees, minus an offset of $69,869.80, court records show.
The judgment, entered Aug. 24 in Linn County District Court, took effect immediately upon entry, according to KWWL.
The initial lawsuit also named Sky Auto’s owners—Igor, Yelena and Alex Tovstanovsk—as defendants, alleging the fraud involved transferring vehicles between the Newhall and Center Point locations to conceal the scheme, engaging in what’s commonly known as “double flooring.”
Why it matters: The judgment highlights the financial and legal risks of dealership floorplan fraud and the importance of strong inventory controls and accurate vehicle financing records for dealers working with lenders and manufacturer-affiliated finance companies.
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Between the lines: The $5.4 million ruling in favor of Stellantis comes amid growing concerns about fraud in U.S. auto retail, where investigators and automakers are uncovering financing schemes involving vehicles used to secure multiple loans, according to Yahoo Finance.
Investigators in Florida recently uncovered a fraud ring tied to dealership insiders, including a finance manager accused of orchestrating more than $1.5 million in fraudulent auto loans using "straw buyers" and fake applications.
In another case, a Miami woman allegedly managed to finance 10 high-end vehicles in just eight days by falsifying income information, highlighting how easily the system can be manipulated.
Bottom line: The Stellantis ruling adds to mounting examples of fraud-related losses across auto retail, reinforcing the need for dealers, lenders, and automakers to strengthen oversight and controls as increasingly sophisticated schemes expose businesses to significant financial and reputational risks.
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