A former part-owner of American Spirit RV in Billings, Mont. admitted Wednesday that he defrauded customers and businesses in a scheme in which he failed to pay off loans and liens, the Billings Gazette reports.
John David Huskey, 43, pleaded guilty to one count of wire fraud in U.S. District Court in Billings, the Billings Gazette reports. A plea deal calls for five other wire fraud counts to be dismissed at sentencing.
Huskey told U.S. District Judge Susan Watters that he essentially “robbed Peter to pay Paul” after the business expanded and couldn’t generate enough money to pay bills when the economy tanked.
Huskey was a part-owner of American Spirit from 2011-14 and was responsible for day-to-day operations.
From May 2012 to April 2013, Huskey sold warranties to customers for about 14 vehicles but did not pay Interstate Dealer Services, which the company had hired to administer the service contacts.
In one case, First Interstate Bank wired $62,900 to American Spirit to finance a vehicle and service contract, but Huskey did not use the money to fund the service contract, according to the report.
Huskey also sold vehicles to 10 customers but failed to pay off the lien on a trade-in vehicle, the prosecutor said.
Huskey also did not pay off flooring loans from financing companies Automotive Finance Corporation and from Dealer Services Corporation, which resulted in months of delays before customers got a lien-free title. The financing companies loaned American Spirit money to buy vehicles. Proceeds from sales were to have been used to pay off the loans.
Watters set sentencing for Jan. 27 and continued Huskey’s release.
He faces a maximum of 20 years in prison and a $250,000 fine.