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Feds: Drivers Faked Bankruptcy To Avoid Auto Impound Fees

A tow truck in action. (CBS)

A tow truck in action. (CBS)

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CHICAGO (STMW) – In a city well-practiced in the way of scams, this is a new one.

Charges made public this afternoon by the U.S. Attorney’s Office allege a scheme where people whose cars were towed to a city pound paid off someone to help get their cars out without paying fees to the City’s Finance Department, the Sun-Times is reporting.

How they did it: They pretended they were filing for bankruptcy.

Daniel Rankins, 30, of Chicago was arrested Thursday and was scheduled to appear in court Thursday afternoon on charges that he took a $600 cash bribe to help someone file a false bankruptcy petition.

But charging documents make clear that the alleged scheme was widespread.

Last May, the City’s Finance Department alerted the bankruptcy trustee to “a significant increase in the number of individuals who appeared to be using bankruptcy as a means of obtaining the release of their vehicles from city auto pounds without paying associated fines or fees.”

“The U.S. Trustee’s Office reviewed and identified more than 1,000 individual pro se bankruptcy filings in which the only creditors identified in the petitions were the Revenue Department and the city’s auto pounds,” the charges say.

“In almost all of these cases, the debtors filed applications claiming an inability to pay the $306 Bankruptcy Court filing fee.”

(Source: Sun-Times Media Wire © Chicago Sun-Times 2013. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)