My favorite rock group of all time is Bruce Springsteen and the E Street Band. You can imagine my excitement, then, when drummer Max Weinberg called my office and told me he was a longtime SCMer and “a huge fan of ‘Legal Files.’” Flattering indeed, but unfortunate that we made our acquaintance because he had a problem.
“Best of the best”
A New Jersey native now living in Florida, Weinberg wanted a collector car that he could drive periodically and enter in a few shows. His search led him to Great Dane Motorsports in Pompano Beach, FL. The company is also known as Investment Automotive Group Inc. (IAG), and is run by Stuart Siegle and his son Arthur.
Weinberg visited the Siegles’ storage-locker-sized shop and saw a partially disassembled 1957 Mercedes-Benz 190SL that he was assured would be restored to a “best of the best” standard. The father-son team said they were restoring the car for sale at an upcoming Amelia Island auction, but Weinberg was told he could have it for $225,000 if he acted quickly. Feeling the pressure, he signed a contract to purchase the vehicle, and paid a $50,000 deposit.
Just days later, Arthur Siegle pressed him to pay the full contract price up front. When Weinberg refused, Stuart met with him and charmed him into paying an additional $75,000 so Siegle could “get his son off his back.” The next day, Weinberg became uncomfortable with the extra down payment, and asked Stuart Siegle to cancel the deal. Siegle refused to rescind the contract and refund the down payment.
Late on the due diligence
Weinberg hired a law firm in Boca Raton, FL, which discovered numerous lawsuits and complaints from previous customers of IAG. Concerned that he might not get the quality of car he was expecting, Weinberg retained SCM Contributor Pierre Hedary, a Mercedes expert and concours judge, to inspect the 190SL.
Hedary and Weinberg went to Siegle’s shop and inspected the car. A few days later, Hedary gave Weinberg a lengthy and highly critical report of his findings. Hedary started from the premise that, as the Siegles had promised, the completed 190SL would be top level, and he noted that the $225,000 contract price was entirely consistent with a concours-level restoration. Unfortunately, Hedary found serious issues including the following:
1. The car had a number of body-panel replacements, but these were not spot-welded. Spot welding was partially responsible for the original build quality of these cars. The sloppy and cheaper methods of bonding the panels together that were readily evident here made it clear that this car would never be a top-level example.
2. Unsurprisingly, given the first point, there was a lot of filler used in the body repairs.
3. There was no photographic documentation of the restoration process or the pre-restoration condition.
4. The engine was not original to the car, and the engine tag and engine number appeared to have been altered.
5. The engine and transmission appeared to have not been rebuilt.
6. The wheels were not correct for the car.
7. Front-end accident damage had been poorly repaired.
8. There was a lot of surface rust throughout the car.
9. The color change from white to silver blue would devalue the car.
10. The car was built with parts from different-year donor cars.
Hedary concluded that a #1 condition restoration was not achievable, and that the $225,000 sales price was “highly aspirational.” After reading the report, Weinberg reiterated to Siegle that he wanted to cancel the deal and get his money back. Siegle refused, and instead offered to do his best to resell the finished car, but insisted that Weinberg wouldhave to finish paying for it and pay him an additional sales commission.
Follow the money
Weinberg met with the Broward County, FL, Sheriff’s Office Fraud Unit during the early summer of 2021. Broward County Officer S.R. Schaefer conducted a thorough investigation over the course of a year and wrote a lengthy report. He concluded that Weinberg’s money had been stolen and that fraud had occurred — and recommended prosecution by the Florida Attorney General’s office. Most of the facts reported in this article come from Schaefer’s report.
Subpoenas were issued for a number of Siegle’s bank accounts in order to follow the money trail. All of Weinberg’s payments went into the Great Dane Motorsports bank account but were quickly withdrawn. There was almost no trace of any of the funds being used to buy parts for the 190SL. Rather, Stuart Siegle and his wife, Arlene, and Arthur Siegle and his wife, Karen, moved funds among a number of personal accounts, using the money to pay personal credit-card bills and buy a truck.
Schaefer also interviewed Alejandro Garcia, the mechanic who was working on the 190SL. Garcia stated that the Siegles had to get parts for the car, and that his work was often interrupted waiting for the parts to arrive. Garcia readily acknowledged that this was not going to be a show car.
Bring in the lawyers
After years of futile settlement efforts, Weinberg retained West Palm Beach, FL, attorney Valentin Rodriguez to file suit against IAG and the four members of the Siegle family. The claims include breach of contract and civil theft.
Although a solid legal claim, the breach-of-contract claim has its practical shortcomings. That claim is limited to recovering the $125,000 Weinberg paid to IAG but would not allow him to touch the assets of the individuals. There is no telling if IAG could pay a judgment once it is rendered. Worse yet, there is no way for Weinberg to recover his legal fees.
The civil theft claim is more interesting. It would allow Weinberg to recover triple his actual damages, or $375,000, plus his attorney fees. It could also create liability for the individual members of the Siegle family, increasing the odds of actually collecting.
Weinberg says he is angry, of course, but he is equally chagrined, as he “should have known better, having grown up in a family of attorneys.” He has always been the most diligent of individuals in his business affairs but confessed to being seduced by the promise of the “shiny object” — the concours-ready car — and what appeared to be the sincerity and charm of the Siegle tag team. As a result, he let down his guard.
The reason Weinberg consented to this article was his hope that it would serve as a cautionary tale for SCMers who might be contemplating such a purchase. He advises not taking even the most charming people’s words for anything without verifying the status and condition of any vehicle you are considering purchasing.
I’ve heard the same thing before from others. If you think of the adage about catching more flies with honey than vinegar, it’s easy to understand. If you plan to be successful at cheating people, you’d better learn to be charming and to appear trustworthy.
More to come
Rodriguez has been contacted by a number of people who say they were also duped by the Siegles. Their reports mark a trail of having used other business entities until the heat got too high, and then dumping them and starting over anew. That raised an interesting but unexpected thought in my mind — could a RICO claim make sense here? As I started to explain what that is to Weinberg, he interrupted me, saying, “I’m from New Jersey. I know what RICO is.”
The Racketeer Influenced and Corrupt Organizations Act was adopted in 1970 to create a federal statute to combat organized crime. Since then, many states, including Florida, have enacted their own versions. But the scope is broader than attacking organized crime. Under RICO, certain listed crimes are considered to be racketeering activity. If a person commits or participates in multiple racketeering acts in connection with an “enterprise,” they can be held criminally and civilly liable for damages to their victims. Even better, the damages are tripled, and the victims can recover their attorney fees.
It’s too early to tell if the multiple victims here create the critical mass needed to bring a charge under RICO, but it is possible. Fraud, as Weinberg has alleged, can be considered racketeering activity. The multiple businesses used by the Siegles could be aggregated into an enterprise. Most important, everyone who participates — that is, the entire family — could be held personally liable. That protects against stashing assets in other family members’ names to avoid liability.
This is not a usual approach one would expect in a collector-car fraud case, but if the facts turn out to fit the RICO structure, it could provide a powerful approach.
Postscript
The completed 190SL was sold on Bring a Trailer for $165,000, even though the contract with Weinberg had not been formally canceled. Counting the $125,000 paid by Weinberg, Siegle has now received $285,000 for a car he agreed to sell for $225,000. None of the money has gone back to Weinberg. Stay tuned for further developments in this litigation. Meanwhile, Weinberg will resume touring with Bruce Springsteen and The E Street Band in March. ♦
John Draneas is an attorney in Oregon and has been SCM’s “Legal Files” columnist since 2003. His recently published book The Best of Legal Files can be purchased on our website. John can be contacted at [email protected]. His comments are general in nature and are not intended to substitute for consultation with an attorney.
This is a horrific story. The only thing I can say, although it isn’t always feasible, is to try to have a qualified person inspect the car before a contract is signed. “Weinberg retained SCM Contributor Pierre Hedary, a Mercedes expert and concours judge, to inspect the 190SL.” If Mr. Weinberg had done this before a contract was signed, all this heartache and expense could have been avoided. A reputable dealer or shop will allow an inspection before a purchase, and if the car is a lemon, it can be avoided, or if still desired, a lower asking price can be negotiated. Glenn in Brooklyn, NY.
Great article and great cautionary tale. Was it this one? https://bringatrailer.com/listing/1957-mercedes-benz-190sl-30/