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Garage is open, despite infractions

Bribes and phony inspections discovered at Charlotte business.

By Fred Clasen-Kelly and Gavin Off
frkelly@charlotteobserver.com

The sign on the door warns customers: "We do not perform illegal inspections. Do not ask."

But inside the Auto Inspector garage in east Charlotte, two employees operated by different rules.

They offered fake inspection results to help vehicles pass emissions tests, collecting as much as $100 per vehicle.

The N.C. Division of Motor Vehicles wants to shut down the garage - one of the busiest inspection stations in the state. The owners acknowledge employees broke the law.

But more than three years after the state opened its investigation, Auto Inspector is still inspecting.

The case shows how a garage caught breaking the inspection program's most serious rules can avoid punishment and remain open through a lengthy appeals process.

"I have to follow the law," DMV Commissioner Mike Robertson said. Once a case reaches the courts, he added, "It's out of our control."

The Division of Motor Vehicles licenses inspection stations.

When the division attempts to suspend or revoke an inspection station's license, state law allows the business to request a hearing with the agency to contest the charges.

If the garage loses, the owner may appeal the decision to the commissioner. Garages can appeal that decision to state courts, which can take more than a year.

Garages facing suspension almost always exhaust their appeals, because citations for serious violations can close the business for at least six months, Robertson said.

Faking test results

Located on Central Avenue, Auto Inspector is operated by brothers Brian and Jeff Stahl, who have gained a significant foothold in the inspection market.

Workers there performed 43,416 vehicle inspections from 2008 to March 2011. Only four stations in the state inspected more vehicles during that time.

All but 84 vehicles passed safety inspections. All but 296 passed emissions tests.

The totals mean the garage, one of several owned by the Stahls, could have received more than $1 million in fees for conducting safety and emissions tests.

In 2008, the state alleges, two workers at the garage falsified results for about two dozen emissions tests over a four-month period by plugging a substitute car into a machine that checks its computerized emissions system, or onboard diagnostics.

The diagnostics system indicates whether the vehicle emits too many toxins.

The owners do not deny their employees took bribes for falsified emissions test results. They said it is unfair that garage owners, who are unaware of fraud, are held responsible for the actions of workers.

"I've got employees just like Food Lion," Jeff Stahl said. "When a worker at Food Lion sells to someone underage, they don't shut down the whole place."

Commissioner Robertson said state law dictates the agency hold garage owners responsible for rule violations. "There is no wiggle room," he said.

Troubled times

The Stahl brothers said they were working as mechanics in the late 1980s when they opened the first Auto Inspector garage.

Customers came to them complaining that repair shops wrongly failed their vehicles during inspections to force them to pay for unneeded repairs, the brothers said.

"They were getting killed," Jeff Stahl said. "It still happens today where they say, 'We'll pass you, but you've got to get your headlights aimed. That's $30.' "

They said they expanded the business to nine garages by 2006, but trouble has hampered the business in recent years. The brothers now operate five inspection garages in Mecklenburg County.

Combined, the five shops inspected nearly 115,300 vehicles, passing about 113,500 for a safety inspection pass rate of 98.5 percent, data from 2008 through early 2011 shows. The pass rate for emissions at the shops was 94.1 percent.

State records show the average pass rate in Mecklenburg County for safety inspections is 95.18 percent, and for emissions tests, 92.8 percent.

Court records show the Internal Revenue Service placed tax liens against Auto Inspector in 2006 totaling nearly $1.5 million. The IRS filed another lien against the company for $238,000 in 2007.

Documents also show the IRS won judgments against Brian Stahl for $506,000 in 2008 and $125,000 in 2009. The judgments remain unpaid, according to court records.

Auto Inspector owed another $76,000 to the N.C. Department of Revenue in 2009, records show. The judgment is still not paid, documents say.

Brian Stahl said a payroll management company Auto Inspector used at the time did not pay Auto Inspector's federal payroll taxes. He said his business is now repaying the government.

Since late 2008, the DMV has cited Auto Inspector garages for at least 44 rules violations, including illegal emissions inspections.

Brian Stahl said the business has incurred violations because it performs so many inspections.

Jeff Stahl said the business tries to operate within rules, but cheating employees are difficult to detect. The DMV also enforces its rules far too strictly, he said, often citing stations for minor offenses.

"I've brought in cameras" to stop workers from faking inspection results, Jeff Stahl said. "There's no way to stop someone from doing this."

Case unresolved

The DMV temporarily shut down the Auto Inspector garage on Central Avenue earlier this year based on a court ruling. Soon after, the Stahls filed for a temporary restraining order, allowing the garage to remain open until the case is resolved.

Robertson said the DMV is trying to speed up the disciplinary process by seeking federal charges against the most egregious rule breakers.

Earlier this year, five Charlotte area car dealership workers pleaded guilty to violating the federal Clean Air Act. Prosecutors allege they ran a scheme in which they falsified results on emissions tests.

The charges carry a maximum sentence of five years in prison and a $250,000 fine, prosecutors said.

Investigators sought an arrest warrant for one of the men in April. All five suspects admitted guilt in July.

Researcher Maria David contributed to this report.

Clasen-Kelly: 704-358-5027
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