Mass. man charged in car registration tax dodge

July 30--MANCHESTER -- A Chinese citizen is accused of lying about living in the city to obtain titles and registration documents for his personal cars and avoid Massachusetts' sales tax.

Zhiyu "Tony" Zhang, 30, of Quincy, Mass., registered his personal vehicles, one a 2013 BMW, in Manchester to avoid mandated insurance coverage and sales tax, according to New Hampshire State Police.

"Quite honestly, it's the New Hampshire Advantage," New Hampshire State Trooper Andrew Player, who investigated the case, told the New Hampshire Union Leader in a phone call Tuesday.

State Police arrested Zhang at Concord District Court on Monday, where he was facing motor vehicle charges unrelated to the case.

On Tuesday, Judge James Michael, presiding in 9th Circuit Court, Manchester District Division, reduced Zhang's bail from $50,000 cash/surety to $10,000 personal recognizance. He ordered Zhang, whom attorney Bruce Kenna said is legally in the country on a B-2 visa, not to travel outside the country without court approval and to sign a waiver of extradition.

Luxury car purchases

For the past year, Kenna said he has represented Zhang in a running argument with state police, Troop G in Concord, over the legitimacy of his business. He said state police have not been able to convince any prosecutor -- state or federal -- that Zhang's business is illegal.

Zhang, according to Kenna, has operated American Lending LLC for the past two to 2 1/2 years out of his Quincy apartment.

Player said American Lending is in the business of obtaining cars in the U.S. that are then exported to foreign countries, mostly China, where there is a high demand for luxury cars. The most popular cars, he said, are BMX5, Mercedes GL350, Porsche Cayenne and Range Rover.

Player said companies in the business of reselling the cars do so with the use of straw buyers. The buyer goes to a dealer, purchases the car, drives it around the block and then hands it over to the company. The buyer submits the paperwork for registration and title to the state, and the buyer is paid $250 to $1,000. The car is then trucked to a pier in New York, New Jersey or even California and then shipped to China.

With a New Hampshire title, it's officially a used car, so it gets out from under a federal law prohibiting the export of new cars, Player said.

Player said the state DMV and state police track registrations and titles of high-end vehicles and investigate when someone buys two to five cars.

Police: False statements

Zhang, however, is not charged in connection with his company. He is accused of two counts of criminal solicitation -- one a misdemeanor, the other a felony -- and three counts of unsworn falsification.

According to criminal complaints, he is accused of twice asking a man by the name of George Ahlin "to make a material false statement upon which an application for a certificate of title" was based that listed Zhang's legal address as 106 West River Drive in Manchester. Zhang is also accused of signing forms at City Hall and at the DMV, stating he was a Manchester and New Hampshire resident, respectively.

Player, in court documents, said Zhang has lived in Quincy since June 13, 2010.

On March 1, 2013, Player said Zhang bought a 2013 BMW 750LI from Herb Chambers BMW in Boston and indicated in paperwork that he had lived in Quincy for 2½ years.

That same day, he allegedly went to the Manchester DMV and applied for a 20-day registration, listing his mailing address as 1 Balsam Way, Apt. 208, Manchester. Zhang did not change his legal address from the 106 W. River Drive, Player wrote.

On April 1, Ahlin, acting on Zhang's behalf, registered and titled the car at city hall, according to court records. The title application listed Zhang's mailing address as 1 Balsam Way, Apt. 106, and his legal address as 106 West River Drive, Apt. 19.

Two days later, Player said Zhang changed his address with Liberty Mutual Insurance to the Quincy address and the company issued an insurance policy for the BMW.

In August 2013, Zhang renewed the BMW registration, listing the same two addresses, according to Player's affidavit.

Kenna told the judge that his client was a student from 2006 to 2013 at Southern New Hampshire University, where he earned an MBA and a second master's degree in information technology. He has no criminal record, aside for some motor vehicle issues, Kenna said.

Zhang is to return to Circuit Court on Aug. 11 for status and probable cause hearings on the charges.

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