According to Greenberg Traurig's Ron Schirtzer, star BMW salesperson Carlos Kirrigin ran a 12-year ponzi scheme that cost Field Motorcars over $5M. The ponzi scheme allegedly involved sales of BMWs to brokers and dealers in Puerto Rico that were made to appear as sales to end-users at prices higher by $1K-$3K than the actual sale price. Prime Wholesalers, for example, allegedly opened a fictitious account to conceal the true purchaser. With the help of fraudulent invoices, fictitious names, and transfers from bank to bank, said Schirtzer, Kirrigan was able to sustain the scheme.
The scheme was allegedly financed partly by outside investors. In addition, said Schirtzer, Kirrigin was buying and selling cars from sources other than from Fields, with Fields partly subsidizing this outside operation. Kirrigin also allegedly borrowed money from the next sale to pay for the prior sale, and eventually the scheme imploded.
Representing himself, Carlos Kirrigan argued that he was not greedy in a bad way, because that is what this capitalism is about. Kirrigan said he was the hardest working salesperson, but was no greedier than anyone else. In fact, his efforts were an important part of the dealership's ability to grow rapidly.
Over 16+ years, Kirrigan said, there were thousands and thousands of transactions, and nothing had changed throughout the years. Why would they only notice red flags after more than a decade?
Kirrigan said that every car dealership is a "ponzi scheme" in the sense that there's money coming in and money going out, and there's a float. If there was a conspiracy, said Kirrigan, it must have started at the top of the organization, where the benefits of his efforts allowed them to transform the dealership from a small store to a "Taj Majal."
From 1991 until he was dismissed in 2008, Kirrigan said, he was advancing the cause of Fields BMW, serving Fields BMW's market, working enormous hours, bringing in astronomical numbers, which significant benefitted Fields, and no one ever complained. "It's not like they only had a meeting once every nine years," said Kirrigan.
Kirrigan said he also did deals elsewhere, but he gave Fields as much business as he could, and possibly as much as they could handle.