AZ Law Has Police Doing Repossessions

WSMV Channel 4 

Phoenix, AZ – November 26, 2013 – What if borrowers who were 90 days delinquent were pulled over by police at gunpoint, cuffed and handled like car thieves? Well, it’s a reality as the result of Arizona criminal code 13-1813 “Unlawful failure to return a motor vehicle subject to a security interest; notice; classification.”

While not many lenders would risk the negative publicity of taking advantage of such a law, some are. The architect and major proponent behind the law is former Arizona House Speaker Jim Weiers, who also happens to be the president of an auto finance company, BHFC Financial Services who directly benefits financially from the law he pushed through.

One major problem with the law is, Police can not identify the difference between a stolen vehicle and a delinquent one by the way the vehicle is reported. As such, normal caution and procedures are taken including the drawing of guns, backup officers and in some cases, helicopters.

“A felony stop, safety is always first, so they are going to treat that like every other stolen vehicle,” said Phoenix police Sgt. Jay Kalmbach.

He said he has no choice but to enforce criminal code 13-1813, a law that lists your car as stolen and labels you a felon if you are 90 days late on your car payment.

“Most times it’s people who have lost their jobs, things that have happened to them in this economy, they’ve gotten behind, and not really the intent there to try to defraud,” Kalmbach said.

Police computers simply indicate a stolen car, and that automatically means the officers call for back-up, when at least three other cars and a helicopter rush to the scene.

Officers must treat you like a potentially hostile criminal.

“Every stop that we make, there is potential risk for problems, something bad could happen.”

“We’re not a game show, but we were giving cars away for free,” stated David Kaufman, the president of Phoenix Corvette Center, who routinely reports overdue car owners to the police.

Kaufman said he sees little difference between cars that are hot-wired off the street and someone who stopped sending in their payment.

“Do I think that person should be held accountable and prosecuted the same way a shoplifter would? Yeah, I do. I don’t see anything wrong with that,” Kaufman said.

As the result of this law, Police in Arizona are in many cases performing repossessions.

But with this law, lenders like Kaufman and others don’t have to pay repossession prices, at least $400 a pop for each seized car.

“In the majority of those cases that are submitted to us, we can’t charge because we don’t have all of the information available,” according to a statement by Maricopa County Attorney Bill Montgomery.

This frustrates Kaufman, who said he believes more delinquent owners should be charged and fined.

“Theft is theft,” Kaufmann said.

But with 20 of these cases submitted per month just in Phoenix, and only 14 already busy detectives in the auto theft unit, Kalmbach says that just won’t work.

“I’d rather see my detectives going on the bigger cases,” Kalmbach said. “It’s just unnecessary risk.”

A person’s car is not only listed as stolen in Arizona, under this law, but if the car’s owner travels out of state, police officers there will see them designated as a felon.