Securities and Exchange Commission Interested in BMW
BMW Group revealed this week that it is under investigation by the U.S. Securities and Exchange Commission following a report of a probe related to the company’s sales practices. A spokesperson for the automaker confirmed the situation on Thursday, saying BMW was in full cooperation with authorities and their investigation.
The probe was reported on earlier in the week by The Wall Street Journal, which had insider sources alleging the company had manipulated sales figures. The SEC is specifically worried that BMW had been engaging in “sales punching” by allowing dealers to register cars moved onto lots as sold to artificially boost sales figures.
You might recall Fiat Chrysler Automobiles being busted over something similar in September. The SEC fined the automaker $40 million for over-reporting monthly vehicle sales for a period of years. Regulators said the carmaker “inflated new vehicle sales results by paying dealers to report fake vehicle sales and maintaining a database of actual but unreported sales.” FCA can’t be officially faulted with anything, since it settled the matter with the $40 million, but it did reissue years of reported sales figures after the SEC took an interest in 2016.
The Wall Street Journal said the SEC is currently trying to determine whether or not BMW engaged in similar sales shenanigans. The agency itself said it could not comment, however.
"Registering vehicles as being sold," sounds different than BMW encouraging dealers to register vehicles, which is what I think I read in the WSJ the other morning. If the dealers are actually registering the vehicles in their respective states, than the buyers are the second owners. More likely, the lease companies are the second owners, but it does paint a picture of how big BMW's incentives to the dealers to engage in sales punching would have to be, and how desperate BMW would have to be for the illusion of sales.
"Investigations" like this always have two characteristics in common: The "penalty" is less than whatever profits were gained by the illegal activities. None of the money ever trickles down to the consumers who were defrauded. This is not "law enforcement". It's just the government taking its cut of the scam.