Feds Just Busted A $545-Million Catalytic Converter Theft Ring Involving An App For Catalytic Converter Sales

Thanks to high material prices and a car shortage threatening to keep things on the road longer, catalytic converter theft has been a big deal over the past few years. While nabbing individual thieves is a lot of legwork, there is a way to theoretically reduce the street value of stolen catalytic converters overnight – find who’s been buying them from thieves and book them. A coordinated law enforcement effort including Homeland Security and the FBI has indicted 21 people in nine states for a relatively sophisticated scheme of buying stolen converters off the street and selling the precious metals inside. Here’s how it allegedly worked.

While many people have been indicted in this case, the such a scheme wouldn’t have been so lucrative if it weren’t for DG Auto of New Jersey allegedly stepping up to the plate. See, DG Auto is a specialist recycling business, one that exclusively focuses on catalytic converters and has the resources to de-can converters and separate out the platinum, palladium, and rhodium inside. It even has an app for selling loads of catalytic converters or using toll refining, where DG Auto refines catalytic converters but doesn’t become the owners of said catalytic converters. While businesses like this are excellent resources for automotive recycling facilities, they can spell big trouble if everything isn’t above-board.

Indeed, prosecutors estimate that the value of materials in stolen catalytic converters allegedly processed through DG Auto clocks in at $545 million. Prosecutors claim that one defendant received $45 million in wire transfers for stolen catalytic converters, while another is said to have received $13 million. Given the sheer quantity of money this case involves, it’s not surprising to see charges laid across five states. The defendants who allegedly sold DG Auto stolen catalytic converters are said to have just paid thieves for the emissions control devices, meaning these middlemen allegedly weren’t even stealing the items in the first place.

As to be expected, law enforcement agencies have slapped defendants with a litany of charges like conspiracy to commit money laundering, and have already seized millions of dollars in assets including homes, cash, and ironically, luxury cars. While the Department of Justice doesn’t mention what sort of luxury cars were seized, I wonder if any of them had their catalytic converters missing.

Catalytic converter theft is a huge pain in the ass if you happen to be on the receiving end of it. Not only do thieves haphazardly slice out the emissions components, often nicking brake lines along the way, replacement is a proper nightmare. If you live in California, you’ll need expensive CARB-certified catalytic converters, while for those in other states, some platforms might not have suitable aftermarket catalytic converters available. Oh, and even if an aftermarket manufacturer makes catalytic converters for your car, don’t count on them being available due to the topsy-turvy supply chain.

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Some 28 years ago, Vincent Vega asked, “What’s more chickenshit than fucking with a man’s automobile?” Today, we might have an answer. It’s significantly more chickenshit to play middleman, a fairly cushy position with all the money of the stolen catalytic converter market and much less risk compared to crawling under vehicles with a Sawzall. Still, the bust of what was allegedly a major theft ring could be good news for car owners as thieves will scramble to find new buyers for stolen cats. With many recycling facilities requiring proof of ownership, it should only get harder to find dodgy recyclers.

Lead photo credit: sidewalk flying, licensed under CC BY 2.0.