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Court documents show that Neil's Finance Plaza consists of two companies: Finance Plaza Inc., owned by Neil Erisman; and Regency Financial Corporation, owned by Tom Moore. In response to phone messages left for Erisman and Moore, a Regency spokesman said the company would not comment. But according to court documents, Finance Plaza buys cars cheaply at auction and sells them to consumers for at least double the auction price. Regency finances the purchases, usually at an interest rate of 18 percent or higher.
Sometimes consumers agree to pay far too much for a car because they have no other choice. "Since we don't have mass transit that's worth much in this city, you need a car to get to where the jobs are," Irwin says. "It's pretty much a necessity if you want to support your family and eat."
Most people Regency sues can't afford a lawyer. After Regency sued Brockman in July 2000, Brockman appeared in court alone twice before he hired Irwin. "I was real embarrassed and real nervous because I'd never been into a courtroom before," Brockman later testified. After Brockman hired Irwin in November 2000 and countersued for fraud and malicious prosecution, Regency dropped its lawsuit against Brockman.
But Brockman did not drop his countersuit. Regency's defense lawyer, Charles Weedman, later admitted in court that the company never should have sued Brockman. Regency only did so, the attorney said, because its lawyers didn't know that Brockman had "just kind of voluntarily brought the car back." A jury decided that the company had harmed Brockman by improperly -- and maliciously -- suing him, and awarded Brockman $30,000 in punitive damages. But a judge ruled that the company should pay Brockman only $1,000 for actual losses he had suffered. Brockman is asking the Missouri Court of Appeals to uphold the punitive-damages award.
In court, Irwin presented evidence that Regency and Neil's regularly failed to complete proper title work on the cars they shuffled back and forth, making those "sales" void.
At the time, Regency estimated it brought in about $200,000 a month in car payments and about $30,000 a month in judgments the company had won against consumers -- money that almost always came from garnished wages. The company employs a full-time attorney, Steve Coffin, whose only job is to sue customers for breach of contract. He files at least twenty such lawsuits a month.
Right now, hundreds of customers from Jackson, Wyandotte and surrounding counties are facing those lawsuits. Each suit alleges that the customer purchased a car through Regency, then "failed to comply with the terms and conditions of the contract." And hundreds of area employers are garnishing their employees' wages to comply with court-ordered judgments in favor of Regency.
But Neil's stays in business because there's a pool of customers who don't have the cash to buy a used car outright and have such bad credit that no one else will offer them an auto loan. Some of Neil's customers have been turned away at other dealerships who claim to finance anyone.
Buying a car at Neil's just adds to many customers' financial woes. Court records show that Neil's gets most of its cars at auction -- where other dealers often unload trade-ins with high mileage or wreck damage. Chances are, the cars will need costly repairs or break down before they're paid off.
One customer, Sherry Sievers, bought a car from Neil's in 2000 and within months had to spend $1,500 to repair the transmission. The engine died a few months later. Stuck with a no-good car and high payments to Neil's, Sievers, a customer service clerk who didn't make much money, had no option but to return the car. It showed up on her credit report as a repossession.