Wednesday, July 1, 2009

Towing scam investigation snares Greg Shepard

Former City cop indicted on fraud

By St. Louis American staff

Ending months of speculation, the U.S. Attorney’s Office in St. Louis indicted a former City police officer last week for allegedly scamming individuals whose cars had been towed by City police and bribing a policeman to go along with the scam.

Gregory P. Shepard was indicted on multiple charges including mail fraud, wire fraud and bribery, all involving his operation of S&H Parking Systems, Acting United States Attorney Michael W. Reap announced.

According to the indictment, Shepard served as manager for S&H Parking Systems and its affiliated businesses, located at 1325 N. 10th St. S&H is affiliated with St. Louis Metropolitan Towing, which has a contract with the St. Louis Metropolitan Police Department. Parks Auto Sales titles and sells a large number of vehicles towed by St. Louis Metropolitan Towing.

The indictment alleges that between approximately October 2004 and August 2008, Shepard devised a scheme to defraud vehicle owners, lien holders and purchasers of vehicles towed by St. Louis Metropolitan Towing and affiliated businesses by contract with the City police.
Regulations require that titled owners and lien holders be given 30 days to retrieve their vehicles after receiving notice before their vehicles can be sold on police auction. If vehicles are not retrieved within 30 days of notification, S&H Parking Systems or one of its affiliated companies can purchase the vehicles and obtain original titles for the vehicles by submitting various forms to the Missouri Department of Revenue.
Despite reports to the Missouri Department of Revenue, Shepard gave no notice, or delayed notice, to vehicle owners and/or lien holders of vehicles towed by St. Louis Metropolitan Towing, according to the indictment.

On other occasions, according to the indictment, Shepard falsely told vehicle owners or lien holders that their cars were no longer held by these affiliated companies when in fact they were. On many occasions, Shepard allegedly made false statements to titled owners of towed vehicles which resulted in artificially inflated storage fees.
‘And others’

The U.S. Attorney’s Office said Shepard “and others” were guilty of these acts of deceit, though only Shepard had been indicted as of press time.

For the entire span covered by the indictment, Joe Mokwa was chief of police. Mokwa testified in the police board trial of Officer Scott Tillis that he had known Shepard for 30 years. Mokwa also testified that he and members of his senior command visited with Shepard at the tow lot on a regular basis for “coffee.” Mokwa also testified that as police chief he at times called Shepard personally regarding towed vehicles.

Tillis testified that he was suspended without pay on a bogus charge after he initiated an investigation into activities at the tow yard after a large number of his neighbors’ vehicles were towed the same night under suspicious circumstances.

Tillis testified that Shepard denied him entrance to the tow yard, saying, “I’m with Joe,” meaning Mokwa. Tillis testified that Internal Affairs and his own command were reluctant to investigate Shepard or the tow yard.

Tillis remains suspended without pay 15 months later.

Mokwa also testified that he is not a subject of the federal investigation and that his retirement from the police force – with taxpayers on the hook for all of his legal fees – was not forced.

According to the indictment, an employee from the St. Louis Metropolitan Police Department passed vehicles for inspection despite obvious flaws. Shepard made many cash payments to this individual for conducting these faulty inspections, according to the indictment.

The indictment also charges that Shepard, a board member of the St. Louis Policemen's Credit Union, notarized a Bill of Sale showing that a vehicle repossessed earlier from a City police officer was being purchased from the credit union by an independent third party known as Grant Auto Sales.
The vehicle was actually purchased by Parks Auto Sales for $1,400, resold by Parks Auto Sales for $3,100, and the profit of $1,700 was never returned to the credit union.

Shepard, 52, was indicted by a federal grand jury on seven felony counts of mail fraud, two felony counts of bribery involving federal programs, one felony count of wire fraud, and one felony count of making false entries.

If convicted, mail fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000; bribery carries a maximum penalty of ten years prison and/or fines up to $250,000; wire fraud carries a maximum of 20 years prison and/or fines up to $250,000; and false entries carries a maximum penalty of 30 years in prison and/or fines up to $1,000,000.

The charges set forth in an indictment are merely accusations. Shepard is presumed innocent until and unless proven guilty. Shepard’s defense attorney David W. Harlan claims his client is innocent.
Assistant United States Attorney’s Jeffrey Jensen and Hal Goldsmith are handling the case for the U.S. Attorney’s Office.

The St. Louis police are governed by a board appointed by the governor of Missouri. It includes as ex officio member the mayor of St. Louis. Mayor Francis G. Slay served on the police board for the entire span covered by the indictment.

Wiley Price photo of Chet Pleban interrogating Joe Mokwa.

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