'Unnatural Acts Department': Sales Fraud Investigators Uncover Fiat Chrysler Code Word

Federal investigators probing Fiat Chrysler Automobiles for alleged sales tampering have uncovered a strange phrase that they believe is a code word.

According to the Wall Street Journa l, company executives would sometimes call up regional managers and dealers and utter a specific phrase. Investigators believe this was a signal for dealers to go ahead and boost end-of-month sales in any way necessary.

The U.S. Justice Department and Securities and Exchange Commission both launched separate investigations into the automaker in July, after hearing reports of inflated sales numbers.

FBI and SEC investigators reportedly visited nine employees in their homes and offices on July 11, while federal staff attorneys visited FCA’s U.S. headquarters in Auburn Hills, Michigan on the same day, and raided or visited locations in Orlando, Dallas and California.

The WSJ report, drawn from sources familiar with the issue, claims that executives would tell managers and dealers that the “unnatural acts department” was open. The message would be delivered in a conference call or in a one-on-one phone conversation. Once given the green light, dealers could aggressively incentivize vehicles, or perhaps go even further.

Investigators have focused on the practice of moving vehicles from a dealer’s inventory to its test fleet, and reporting that transaction as a sale. The sale would then be rolled back at the beginning of the next month.

When it changed its sales reporting methods in late July, ending a 75-month sales streak, FCA claimed, “It is admittedly also possible that a dealer may register the sale in an effort to meet a volume objective (without a specific customer supporting the transaction).”

Sketchy sales reporting is behind a racketeering lawsuit filed against FCA by an Illinois dealer group. Napleton Automotive Group claims the automaker paid them to inflate sales data at their dealerships. FCA has denied the practice.

[Image: Fiat Chrysler Automobiles]