A $600 million catalytic-converter theft ring has revealed what happens when the pricey car part is

Publish date: 2024-07-08
2023-10-20T18:33:29Z

It began as a business front under a family name: Vang Auto.

Then, within three years, members of the Vang family had sold millions of dollars worth of stolen catalytic converters, participating in a sprawling nationwide theft ring, prosecutors alleged in an indictment filed in October 2022.

On Monday, three members of the Sacramento, California, family pleaded guilty to conspiring to transport stolen catalytic converters to New Jersey for more than $38 million in wired payments, according to the US attorney's office for the Eastern District of California: brothers Tou Sue Vang, 32, and Andrew Vang, 28, and their mother, Monica Moua, 58.

Twenty-one people across five states were arrested last year in connection to a "national network of thieves, dealers, and processors" that sold $600 million dollars worth of stolen catalytic converters, according to the Justice Department. The defendants were charged in two separate indictments in the Eastern District of California court and the Northern District of Oklahoma. Thirteen were charged in the Northern District of Oklahoma where the case is still open. Six of the nine charged in the Eastern District of California still have open cases.

Catalytic converters, emissions-control devices installed on the undercarriage of most US vehicles that run on an internal combustion engine, have become a coveted piece of equipment for thieves.

Inside catalytic converters are precious metals — including palladium, platinum, and rhodium — that have become more valuable than gold. In 2021, an ounce of rhodium was valued at about $30,000.

According to the National Insurance Crime Bureau, insurance claims for catalytic-converter thefts increased by more than 288% from 2020 to 2022, to 64,701 claims from 16,660. More than 24,000 claims last year came from California.

The scheme, according to prosecutors

The Vang brothers and their mother operated a business called Vang Auto for which the brothers obtained a business license on May 29, 2019. According to the indictment, Vang Auto purported to be an "automotive dismantler business."

Prosecutors alleged in the court documents that the brothers and mother purchased catalytic converters "they knew were stolen from local thieves and cutters" — a term for people who steal the devices from vehicles.

Todd Leras, an attorney for Andrew Vang, told Insider in an email that he would prefer to comment on his client's case in court filings.

Heather Williams, a federal public defender for Tou Sue Vang, wrote in a statement that Vang had pleaded guilty to all 40 counts against him as part of a deal for his brother and mother to receive "beneficial agreements."

Shari Rusk, an attorney for Moua, said her client had a "very minimal role."

"She does not speak any English and had limited understanding of what was going on," Rusk said in a statement to Insider. "She did very little in connection with this offense."

Prosecutors alleged that the Vang brothers stored the stolen devices in different storage-unit facilities until they were shipped to a New Jersey business called DG Auto. An attorney who represented DG Auto did not respond to Insider's request for comment.

According to the indictment, DG Auto was incorporated as a catalytic-converter recycling company on February 4, 2020, and had locations throughout New Jersey. The business was operated by six employees who were arrested last year, according to the Justice Department.

Prosecutors alleged that the company extracted the precious metals from catalytic converters and sold the resulting powder to a metal refinery.

DG Auto employees knew that at least some of the catalytic converters were stolen and that their customers, including Vang Auto, were not licensed scrap dealers, prosecutors alleged in the indictment.

They also alleged that DG Auto employees created an app that was available to Apple and Android devices that could provide quotes on various catalytic converters, according to the court filings.

The indictment accused DG Auto employees of creating and operating the DG Auto Pricing Application to "increase their customer base, encourage the theft of the highest-value converters, and enable their affiliates to accurately price different catalytic converters."

DG Auto's app provided "real-time pricing information for catalytic converter thieves and their customers such as Vang Auto," the court documents said.

The app also charged subscription fees and users had to purchase credits to look up the price DG Auto would pay for a certain catalytic converter. Prices would change based on the market rates for the precious metals, the indictment said.

On various shipments, Vang Auto would at once send hundreds of stolen Toyota Prius catalytic converters or boxes of the devices weighing several thousand pounds, according to the indictment.

Between February 13, 2020, and May 31, 2022, DG Auto wired Vang Auto about $36.1 million. During that same period, the Vang brothers withdrew about $32.6 million to pay catalytic converter thieves in cash, the indictment alleged.

As part of his plea agreement, Tou Sue Vang is required to forfeit his assets, which include two properties in Sacramento County; 22 vehicles including Teslas, trailers, Jet Skis, ATVs, and a Ford F-250 truck; and catalytic converters.

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