Former owner of high-end Upland auto dealership charged with theft, tax fraud

Shane Hammond still has the yellow 2008 Ferrari F-430 he bought for $105,000 in 2019 at the former CNC Motors in Upland. He says it evokes strong, painful memories whenever he looks at it.

“I’m stuck with it, and I’m stuck with the memory of who put me in this position. Every time I look at that car I think of that son of a bitch,” Hammond, 53, said of Clayton Thom, the former owner of the high-end auto dealership.

Hammond, a former Santa Clarita resident who now lives in Idaho, said in a telephone interview on Thursday, Nov. 2, that Thom assured him he was buying a solid car at the time of purchase. Hammond, however, said the car presented nothing but problems from the day he bought it.

“The very first night we got that car it almost killed us because the throttle got stuck wide open,” Hammond said.

Hammond was one of dozens alleged victims who claim to have bought super lemons instead of supercars from Thom. Dissatisfied and frustrated customers also alleged CNC Motors was floating titles and not paying them for vehicles sold on consignment, nor was the dealership squaring auto loans with banks. It prompted a DMV investigation that ultimately wound up in the hands of the California Department of Justice.

The dealership finally closed in 2021 as the DMV was investigating widespread complaints.

Criminal charges

On Wednesday, Nov. 1, California Attorney General Rob Bonta announced his office had filed criminal charges against Thom, 50, and his former business manager, Valerie Tanaka, 61.

Thom is charged with 37 felony counts of grand theft and one count of elder theft for allegedly stealing more than $4 million from 35 customers from 2018 through 2021. Additionally, Thom and Tanaka are both charged with 13 felony counts of tax fraud for allegedly not remitting $4.4 million in sales taxes to the state.

The two pleaded not guilty during their arraignment Tuesday in Rancho Cucamonga Superior Court.

Thom remains in custody on $8.7 million bail at the West Valley Detention Center in Rancho Cucamonga. Tanaka was released from custody on her own recognizance following their arraignment, court records show. The two are scheduled to next appear in court on Monday, Nov. 6, for a pretrial hearing. Thom also is requesting that his bail be reduced, according to court records.

In a statement this week, Bonta said, “I am grateful to my legal team and our state agency partners for their incredible work in this case. Fraud against Californians and against the state will not be tolerated by the California Department of Justice.”

Embezzlement scheme

Authorities allege Thom, while acting in his capacity as owner of CNC Motors, encouraged his customers to place their high-value vehicles on consignment at his dealership, sometimes persuading them to surrender the titles to their vehicles.

The alleged victims signed contracts that promised payment within 20 days of the sale of their vehicles. Thom, however, would sell the cars and not pay his alleged victims, using the consigned vehicles to settle his debts and to obtain loans, according to the Justice Department.

Thom allegedly prevented customers who purchased consigned vehicles from receiving legal ownership and did not endorse, date, and deliver certificates of ownership and registration to the customers. In some cases, Thom provided his customers with forged titles, according to the Justice Department.

With Tanaka’s assistance, the Justice Department alleges, Thom collected but failed to pay about $4.4 million in sales tax to the state from 2017 to 2021.

Reached by telephone on Thursday, Tanaka declined to comment.

Court records show a deputy public defender had been appointed to represent Thom.

‘Bittersweet news’

For Thom’s alleged victims, some, including Hammond, were left with conflicting emotions upon hearing the news that Thom was in custody facing multiple felonies.

“There’s a certain sense of satisfaction as you’re telling me this, but I know I will never get any kind of repayment from that guy, which I wrote off long ago,” said Hammond, owner of a design and fabrication company that manufactures props for the film and television industry.

Dan Hurlbert, an Austin-based YouTuber and supercar aficionado who came to Hammond’s aid in 2021 and launched an online campaign against Thom and CNC Motors, said he fielded upwards of 100 complaints on his Normal Guy Supercar website from irate CNC customers who claimed to have been swindled by Thom.

“It’s unfortunate the whole situation happened. There are still tons of people out there who haven’t been made whole, and probably will never be made whole,” Hurlbert said in a phone interview on Thursday, Nov. 2.

He said he understands why it took authorities so long to charge Thom, given the complexity of the case.

“I don’t think it’s enough punishment,” said Hurlbert, who added that the ordeal prompted him to open his own dealership, NG Supercars, in 2022.

“We started our own supercar dealership to have an honest and transparent option for people. This whole thing was a motivator to do that,” Hurlbert said.

Hammond said he’s made attempts to sell the Ferrari, but because he has to disclose its rocky history, few people have shown interest. He said the sale price for the year, make and model of his vehicle ranges from $135,000 to $179,000. He paid $105,000 for it and poured in another $70,000 into repairs.

“I think the best offer I had on it was $112,000,” said Hammond, who had difficulty reconciling the news of Thom’s arrest with everything he has gone through in the past four years.

“It takes some of the burn away, but it still hurts,” he said. “It’s still coming up short for us. So it’s bittersweet news.”

Source: Orange County Register