GREEN BAY, Wis. (WBAY) - Federal fraud charges have been filed against the former owner of vehicle consignment businesses in Northeast Wisconsin.
John Solberg is escorted into federal court in Green Bay. Nov. 27, 2019. (WBAY Photo)
Action 2 News has learned a federal grand jury has returned an indictment against John Solberg, 37, on 15 counts of fraud.
In video you'll see only on Action 2 News, our cameras captured U.S. Marshals escorting John Solberg and his brother, Robert, into the federal court building in Green Bay Wednesday morning. John was in an orange jumpsuit after spending the night in the Brown County Jail.
Robert Solberg, 35, was indicted in a separate case for conspiracy and odometer tampering. CLICK HERE for details on Robert Solberg's case.
During John Solberg's appearance in federal court, prosecutors said they had 41,000 documents related to the case.
The indictment says John Solberg conspired to “defraud automobile sellers, automobile buyers, financial institutions, and others through the use of the United States mail, by means of interstate wire communications, and by concealing material facts from federally insured financial institutions.”
The U.S. Attorney's Office says Solberg "operated, directed and supervised" dealerships under the names Backwoods Bargains, Standard Pre-Owned, Suamico Investment Group, and Bella Investments, LLC at locations in Suamico and Kaukauna.
Solberg was indicted on these charges:
Conspiracy to Commit Mail, Wire, and Bank Fraud (one count)
Mail Fraud (one count)
Wire Fraud (13 counts)
“Fraud schemes not only harm their victims but also erode trust within communities, making people less willing to engage in commerce with each other,” said United States Attorney Matthew D. Krueger. “These charges demonstrate a strong commitment by law enforcement at all levels to investigate and prosecute fraud aggressively.”
Action 2 News has been following the Solberg case for years. Viewers came to us asking to look into Standard Pre-Owned in Suamico and Kaukauna.
In May 2016, investigators served a search warrant at the Suamico location.
The warrant says John Solberg would contact people trying to sell cars on Craigslist and offer to do it for them. Court records state Solberg refused to pay the owners after the sale or refused to return their vehicles. In some instances, he would sell vehicles for a lower price, investigators say.
When people complained, investigators say Solberg would write checks that would bounce.
Several alleged victims filed a civil suit in 2016, claiming they lost $450,000 to Solberg and Standard-Pre Owned.
The Wisconsin Department of Transportation first started looking into the business in 2011 after receiving complaints from customers.
The Brown County Sheriff's Office started their investigation in 2016. They identified hundreds of alleged victims in several states.
The investigation was later handed over to the FBI and the U.S. Attorney's Office.
Solberg is being held in jail over the holiday weekend. He's expected to have another court appearance next week.
If convicted, the conspiracy count carries a maximum of 30 years in federal prison and a $1 million fine. The remaining counts each come with a maximum of 20 years in federal prison and $250,000 fine.
We dug through online records with the state Division of Hearings and Appeals and found 25 victims were paid from a $50,000 surety bond. Standard Pre-Owned was required by law to have one of these bonds.
The money the victims lost far exceeded that $50,000. Their settlements were pro-rated with each victim receiving about 18 cents for every dollar lost.
The Standard Pre-Owned case prompted state lawmakers to simplify the process for the Wisconsin Department of Transportation to deny, suspend or revoke certain licenses. It also allows the DOT to address "the most severe cases of fraud." Gov. Tony Evers signed the bill into law in May. CLICK HERE to learn about the new law.
John Solberg's brother, Robert, was taken into federal custody Friday for a separate case. Robert Solberg, 35, is charged in connection to a scheme to sell vehicles with altered odometers. CLICK HERE for full details on the Robert Solberg case.