Kruse auctions?

[Restorer32]

Are the rumors true? Another site I visit says they have lost their Indiana Auctioneers license. Is this news or have I just been out of the loop?

[ted sweet]

its true but i am sure posting details wont be allowed here as to why.

[R Walling]

Indiana yanks Kruse auction licenses

[msmazcol]

We had a family of a deceased friend have a horrible experience. It still is unsettled.

Those are the facts.

[Guest Gary Hearn]

While pulling their license will eliminate sales in Indiana (or the use of the Indiana license in other states) I saw little to indicate the amount that may be owed to consignors for cars that were sold. I wonder what the total amount is and if any enforcement action is being taken to get those people the money they are owed.

Plain and simple, any funds received for the sale of a vehicle should have been segregated and treated as escrow. A down economy will have no impact on the proper accounting for customer funds, I only hope that justice is done in the end.

[MochetVelo]

Here's an article with more specifics about the money in question. I quote from Classic Cars For Sale web site.

VETERAN AUTOMOBILE AUCTIONEER DEAN KRUSE LOSES LICENCE

The Indiana Auctioneer Commission has permanently revoked Kruse International’s auction license after hearing complaints about business practices that left dozens of people awaiting payment for consigned cars sold at Kruse auctions. The panel also fined Dean Kruse and his company $70,000 and ordered the veteran automobile auctioneer to pay former clients the $300,000 he owes them.

According to Commission Assistant Board Director Katie Blackburn, the fine could have been twice as big, but the commission thought it was better for Kruse to pay his clients. “That was the State and the Commissioners’ primary concern - that he pays those people back, “ she said. “They didn’t want the civil penalty to impede his ability to do that.” Kruse must also submit quarterly reports to the Commission documenting his progress in paying back the $300,000 over the next 3½ years.

According to John Price, Kruse’s Attorney, the veteran auctioneer’s problems started when people bought cars at the September 2008 and 2009 auctions and didn’t pay for them, owing Kruse millions of dollars. Kruse, in turn, then owed 70 vendors $1.5m he didn’t have, although all but $300,00 had been repaid, said the lawyer,

The high profile judgement against Kruse marks the ignominious end of a classic car auction boom story that started at Auburn in 1971, since when thousands of visitors have flocked to the 110-acre Kruse auction site each Labour Day weekend to bid for cars once owned by Clark Gable, Elvis Presley and Marilyn Monroe. And while Auburn Mayor Norm Yoder is hopeful that Kruse can find some other auction house to take over his annual pitch, so that the city can still lure in big spending visitors to its hotels and restaurants, Kruse himself is reportedly considering selling both the real estate and his company.

Rivals Mecum, meanwhile, attracted more than 30,000 punters to their recent five-day Spring Classic Auction, their 23rd such annual bash to be staged in the same State at Indianapolis. More than 1000 collector automobiles, 66 per cent of the total offered by Mecum during the 19-23 May bash, changed hands for a mega-$41.7m. Clearly, the oldtimer auction market in Indiana has already moved on.

[Guest Gary Hearn]

Here's an article with more specifics about the money in question. I quote from Classic Cars For Sale web site.

According to John Price, Kruse’s Attorney, the veteran auctioneer’s problems started when people bought cars at the September 2008 and 2009 auctions and didn’t pay for them, owing Kruse millions of dollars. Kruse, in turn, then owed 70 vendors $1.5m he didn’t have, although all but $300,00 had been repaid, said the lawyer.

This makes no sense..... If a bidder did not pay for the car it should have simply reverted back to the owner/consignor and been treated as a "no sale". Kruse never should have let any vehicle leave the premises if it was not fully paid for with good funds.

If they were overlooking such a basis business tenet they deserve to go out of business. Unfortunately, it is the people who consigned cars who were burned by their lack of business acumen.

[Restorer32]

We just happened to be bystanders in 1980 or so when gun carrying Federal agents seized the proceeds of the Kruse Atlantic City Auction because of a "misunderstanding". Apparently they have had an ongoing problem with accounting.