More than two years after events overtook Upland’s premier high-end auto dealership, engulfing it in scandal and forcing its closure, the primary owner of the company and the company’s former business manager have been criminally charged.
On Wednesday, November 1, the California Attorney General’s Office filed 37 felony counts of grand theft and one count of elder theft and 13 charges of tax fraud against Clayton Thom, the former co-owner of now defunct CNC Motors. Valarie Tanaka, the Business manager and head accountant at CNC, was charged as a co-defendant to Thom in all 13 of the tax fraud charges.
In 2018, CNC, which had been founded in 2006 by Craig Thom and his sons Fraser Thom and ClayThom and had functioned out of three other locations, including one in Upland, located into an impressive automobile sales facility and showroom known as CNC Motors at 1018 East 20th Street, located just north of the 210 Freeway near the Campus Avenue exit in Upland. The dealership and its showroom were constructed under the aegises of CDJT Development, CNC Motors Real Estate LLC, and CRAIG THOM PROPERTIES, LLC, a California Domestic Limited-Liability Company created by Clay Thom in September 2016, four years after the death of Craig Thom. The undertaking, which entailed a 27,500-square-foot showroom, and 12,000-square-foot auto service and detailing facility, was built at a reported cost of  $11.5 million, which included land acquisition, grading, engineering and architectural preparation, construction and the cost of installing a storm drain and sewer lines in compliance with city specifications and requirements.
vehicles, including late model Maseratis, Ferraris, Jaguars, Porsches, Lotuses, Aston Martins, Lamborghinis, Bentleys, Rolls Royces, McLarens, Mercedes Benzes, less expensive mid-range vehicles as well as restored vintage 1930s, 1940s, 1950s and 1960s cars. Contained under the same roof as CNC were Lotus of Upland LLC, an auto dealer; Spyker of Upland LLC, another auto dealer; GFY Auto Inc, another dealer; Fast Fix & Detail, an auto services provider; and LIG Financial Services, a lender.
The dealership/showroom at 1018 East 20th Street played a key roll in allowing Thom to perpetrate what the California Attorney General’s Office now maintains was little more than a pyramid scheme. Thom utilized the showroom filled with well upwards of $30 million worth of impressive vehicles to get car owners to entrust him with their vehicles, many of which were exotic ones valued at over $100,000, so that he could sell them on consignment. Making confident representations that he could sell the vehicles in relatively short and obtain for the seller a price generally considered to be above the listed value of the cars, providing both himself and the seller a tidy profit, Thom in virtually every case induced car owner into voluntarily turning the vehicle over to CNC by personally driving the vehicle into the CNC showroom and handing over the keys to Thom or one of CNC’s employees. This was a strategy to turn any dispute over CNC’s possession of a vehicle it did not have title to and any subsequent disposition of the car into a civil rather than a criminal matter.
In most cases, Thom would then sell the vehicles, obtaining payment either in cash from the buyer or payment in full from the buyer’s lender. Thom invariably permitted the purchaser to take immediate possession of the vehicle upon the cash sale or the signing of documents, offering assurance that the title documentation to the car would be soon forthcoming.
When the seller would seek payment, Thom used a variety of assertions to defer passing the money received in the sale through to the title owner, including that payment was to be made later that day, the next day, or within a few days. Upon coming to the dealership, either by invitation or unexpectedly, the seller would be told that the dealership did not at that juncture have sufficient funds in its accounts to make payment or that the company controller who had possession of the company’s checkbook was not there. On occasion, Thom would arrange for a check to be cut to the car seller, but payment on the check would be canceled or it was returned for insufficient funds.
In some cases, Thom sold the cars directly to a buyer. In other cases, he unloaded the cars to a dealership. In virtually every case, Thom made those sales without himself being in possession, even as an intermediary, of the title, such that the purchaser never actually received title.
Multiple sellers reported to the Sentinel and other sources that they were not notified of the sales until they made an inquiry. In this way, the seller was not asked to hand off title nor provided with the opportunity to sign a release of liability. On at least three occasions known to the Sentinel, an owner, having logically but erroneously assumed on the basis of a misrepresentation by Thom or another CNC salesperson the individual or entity in possession of the car had secured insurance for it, canceled his insurance coverage for the vehicle.
There was further indication that Thom on some occasions took cars on consignment and then provided those cars to individuals or dealerships to whom he had previously owed money. CNC reportedly was in arrears to Lotus well over $2.5 million by Spring 2021, and as a result, those who had purchased brand new Lotus Evoara GTs from the dealership had not been given title to the cars and were unable to register them.
There were multiple narratives from Thom’s victims that he had, as a middleman, perfected the means of taking the money involved in the transactions he was involved in for himself and leaving ownership up in the air between the sellers and buyers, most often with the seller still in possession of the title and the buyer in possession of the car.
An element of Thom’s formula was keeping the seller in the dark as to who the purchaser was.
A significant number of the sellers financed the purchase of the vehicles in question and therefore found themselves owing money on the cars. Thus, the sellers were in a large number of cases counting on the sale of the vehicles to pay off the debt relating to the original purchase of the vehicles. By getting involved with Thom and CNC, the would-be sellers were in the position in which they were yet paying the liens on cars they didn’t have. In such cases, the original owner had title to the vehicle and legal liability for it. The individual in possession of the car did not have title, which rendered problematic the securing of registration and insurance for the vehicle in question. So, in addition to the owner yet making payments on a car he no longer possessed, he found himself in the position of having to pay for insurance on the vehicle as well.
In one case, the owner of a car was stiffed by Thom after he dropped the car off with CNC as part of a consignment arrangement. The car then was transferred to a dealership to which Thom reportedly owed money as part of a trade to pay down on that debt. The owner of the car, unable to induce Thom to make good on the money owed from the consignment sale, without Thom’s cooperation, initiated a search for his car. He succeeded in locating the vehicle in the showroom of another dealer. After first feigning interest in purchasing the vehicle, the owner was able to obtain particulars with regard to what had occurred, at which time he produced his title to the car and informed the dealership that the car was his. The dealership’s owner, recognizing that the dealership could not claim legal ownership of the car, while acknowledging that the owner indeed appeared to have the right to take possession of the car, prevailed upon the owner to permit the dealership to make contact with Thom to get things squared up before that occurred. After several days, nothing was resolved and Thom was not forthcoming with any money. At that point, the owner returned to the dealership with his title document and members of the police department in the city where the dealership was located, and was able to recover his car.
Outcomes for most of those who were seeking have Thom and CNC Motors sell their vehicles were generally not as satisfactory.
One factor is that the Upland Police Department has been reluctant to get involved in the matters involving CNC. On a basic level, since Thom did not have possession of the cars themselves and the original owners in their narratives generally acknowledged having voluntarily turned the vehicles over to CNC, investigators could readily conclude the matter fell within the rubric of civil law rather than criminal law, in that while what CNC and Thom had engaged in conversion and a civil theft, their collective actions did not rise to the level of a criminal act. Further, to the extent that criminal fraud could be conceivably have been alleged against CNC or Thom, the Upland Police were discouraged from pursuing the matter as a criminal case, given that CNC represented one of the City of Gracious Living’s more prestigious business operations. Consequently, when those who had lost a vehicle or money to Thom’s tactics approached the Upland Police Department, its officers routinely referred them to the California Department of Motor Vehicles and its criminal/civil investigative arm.
One of the earliest efforts to hold Thom and CNC accountable through a civil action was that by The Alegra Collection, LLC, a car dealership in Tampa , Florida that purchased 2017 Mercedes G550 for $225,000 in December 2020 from CNC Motors. Alegra sued CNC, Thom and Joseph Firmapaz a CNC sales representative in United States District Court for the Middle District of Florida in Tampa, alleging that while CNC delivered the vehicle, it withheld the title. Ultimately, CNC, Thom and Firapaz were able to get the suit dismissed by going to an effort to pay the owner of the vehicle, obtain the title and provide it to Alegra.
This illustrated how Thom was able to remain a step ahead of the law and authorities in that he would ultimately perform and come through for those customers or victims if, but only if, they showed the willingness to pursue action of some sort against Thom and CNC. Those who took such meaningful action, which required finding Thom to serve him, would eventually be paid. Those who did not take any action or effective action would not be paid. The ratio of those paid to those who were not was less than one to ten. This qualified what Thom was engaged in, authorities say, as a pyramid scheme.
Thom until 2021 lived in a 5,100-square foot mansion on a 0.38-acre lot at at 2588 West Euclid Crest in San Antonio Heights, the unincorporated county area north of Upland. That home, valued in 2021 at $1.4 when it sold in 2021 had been paid for by funds from the Thom Family Trust. Clayton Thom and his wife, Amy, cleared out of that residence as more and more of the victims of the fraudulent CNC car consignments had become aware of where the couple was living and began sharing that information with other victims.
Thom and his family sought to prevent those who had dealings with CNC and the public at large from learning where they were living in the aftermath of their departure from San Antonio Heights.
At this point, the long arm of the law has caught up with Thom.
According to California Attorney General Rob Bonta, Senior Assistant Attorney General James Root, Supervising Deputy Attorney General Patricia Fusco and deputy attorney generals Michael Hasychak, Vikram Mandla and Marisa Landin allege 51 separate sometimes related and sometimes unrelated criminal acts against Thom and Tanaka, 44 of which are counts lodged solely against Thom and 7 of which are lodged against both Thom and Tanaka.
According to the criminal filing, Thom stole, or in the language of the filing, “fraudulently appropriated,” vehicles from sellers and stole, or in the language of the filing “did knowingly and designedly, by a false representation and pretense by fraud” from buyers of some of those cars. Not all of the cars stolen were fraudulently sold, though some were. In those cases where an alleged car theft occurred and an alleged fraudulent sale occurred, two counts are listed. Where only an alleged car theft occurred, as single count is listed. According to the filing, in one of the cases, a 2003 was stolen from a senior citizen sometime between June 2018 and December 2019 and was sold for $150,000. With regard to that matter, four counts were filed, one pertaining to the grand theft of the vehicle, another pertaining to the grand theft of the $150,000 and a third charge of grand theft from an elder and another pertaining to the grand theft of $250,000. Apparently, the vehicle was sold $100,000 more than it was valued at.
Two counts of grand theft were filed with regard to a 2020 Mercedes G63 stolen on November 26, 2019, which was fraudulently sold for $251,593.85.
Two counts of grand theft were filed with regard to a 2020 Chevrolet Corvette stolen in November 2020 and fraudulently sold for $47,986.16.
Two counts of grand theft were filed with regard to a 1953 Jaguar X K 120 between September 2018 and March 2020 and fraudulently sold for $100,000.
Two counts of grand theft were filed with regard to a 2020 Mercedes G63 stolen on June 1, 2020, which was fraudulently sold for $183,341.59.
Two counts of grand theft were filed with regard to a 2005 Thunderbird stolen between January and February 2021, which was fraudulently sold for $22,000.
Two counts of grand theft were filed with regard to a 2017 Nissan GTR solen between October 2020 and December 2020, which was fraudulently sold for $123,909.26.
Two counts of grand theft were filed with regard to a 2017 Nissan GTR solen between October 2020 and December 2020, which was fraudulently sold for $109,084.09.
Two counts of grand theft were filed with regard to a 1970 Chevrolet Chevelle stolen between July 2020 and October 2020, which was fraudulently sold for $40,000.
Two counts of grand theft were filed with regard to a 2017 Chevy Corvette stolen between February 2020 and July 2020, which was fraudulently sold for $66,217,60.
Two counts of grand theft were filed with regard to a 2018. Dodge Challenger Demon stolen between September 2020 and December 2020, which was fraudulently sold for $139,230.13.
Two counts of grand theft were filed with regard to a 1999 Porsche 911 stolen between August 2020 and December 2020, which was fraudulently sold for $31,767.13.
Two counts of grand theft were filed with regard to a 1981 Chevrolet Corvette stolen between September 2020 and February 2021, which was fraudulently sold for $20,378.
Two counts of grand theft were filed with regard to a 2000 Ferrari 360 stolen between October 2020 and December 2020, which was fraudulently sold for $73,869.08.
A single count of grand theft was filed with regard to a 2001 Hummer stolen between December 2020 and April 2020.
A single count of grand theft was filed with regard to a 2009 Audi R8 stolen between August 2020 and November 2020.
A single count of grand theft was filed with regard to a 2007 Ferrari stolen between July 2020 and October 2020.
A single count of grand theft was filed with regard to a 2014 Mercedes Benz SLS stolen between February 2021 to March 2021.
A single count of grand theft was filed with regard to a 2009 Maserati Quarttroporte stolen between July and October 2020.
A single count of grand theft was filed with regard to a 1975 Lincoln Mar IV stolen between October 2020 and November 2020.
A single count of grand theft was filed with regard to a 2017 Tesla stolen in August 2020.
A single count of grand theft was filed with regard to a 2016 McClaren 675 GT Spider stolen between December 2020 and April 2021.
Both Thom and Tanaka were charged with failing to report $434,381 in income collected by CNC Motors during the third quarter of 2018 in a filing dated October 18, 2018.
Both Thom and Tanaka were charged with failing to report $434,381 in income collected by CNC Motors during the third quarter of 2018 in a filing dated October 18, 2018.
Both Thom and Tanaka were charged with failing to report $593,128 in income collected by CNC Motors during the fourth quarter of 2018 in a filing dated January 31, 2019.
Both Thom and Tanaka were charged with failing to report $452,982 in income collected by CNC Motors during the first quarter of 2019 in a filing dated April 30, 2019.
Both Thom and Tanaka were charged with failing to report $442,840 in income collected by CNC Motors during the second quarter of 2019 in a filing dated July 31, 2019.
Both Thom and Tanaka were charged with failing to report $588,489 in income collected by CNC Motors during the third quarter of 2019 in a filing dated October 18, 2018.
Both Thom and Tanaka were charged with failing to report $695,887 in income collected by CNC Motors during the fourth quarter of 2019 in a filing dated January 31, 2020.
Both Thom and Tanaka were charged with failing to report $42,000 in income collected by CNC Motors during the first and second quarters of 2020 in filing dated May 20, 2020 and December 31, 2020.
Thom is also charged separately with failing to file tax returns for January through March 2021, filing false sales tax returns in quarters 1, 3 and 4 in 2019, filing a false sales tax return in quarter 1 of 2020, filing a false sales tax return in quarter 2 and 3 of 2020, failure to file a sales tax return in quarter 4 of 2020 and failure to file a sales tax return in quarter 1 of 2021.
Thom was taken into custody on Monday, October 30 at 4:40 p.m. by investigators with the California Attorney General’s Office at a residence in the 2100 block of Laurel Avenue in Upland. He remains jailed, held in lieu of $8.7 million bail.
Tanaka was arrested as well, but she has been released on her own recognizance.