The Expert Podcast

A lot of good lessons come from this story if you are an owner of a classic car that you're restoring or if you're a mechanic or a restoration company. This is an excellent article about an event that happened that ended up costing somebody millions of dollars because of an improper restoration scheme and a mechanic that was not doing the right thing.

In this case, there was a wealthy individual who used to own Angie's List, which is a kind of a contractor-type social media platform. The former CEO had a bunch of classic cars, and he wanted to have them restored and properly brought back to their original state. So, what he did was he worked with a boutique mechanic, somebody who specialized in this type of work on older cars, and had them work on his vehicles. This mechanic also helped him find some vehicles.

Over the course of a couple of years, the mechanic overcharged for service work on multiple rare vehicles, and he also faked some vehicles. This is something to watch out for if you are a classic car collector—make sure that you're checking the provenance of a vehicle. Look, this is somebody who's the CEO of a major company. He had millions of dollars, and he thought he was doing proper due diligence on the vehicles, but what happened was he was promised that he was purchasing a very rare Austin Healey 100M sports car, which was claimed to be a coveted factory model but needed some assembly.

Come to find out, it was not that type of original factory vehicle. He paid $50,000 for it, and it turns out it was worth nothing. He discovered that the 100M was not a factory 100M as Hillinger, the alleged mechanic, had promised. Hillinger told the collector that it would cost $10,000 to assemble and then sent the collector an invoice for $130,000. But that wasn't even the worst part. The worst part was when the collector purchased a vehicle for $16,000 and was told that the work would be done in one or two years and cost $200,000. Four years later, the job wasn't completed, but he had bills for a million dollars.

These are big numbers, and while you might use smaller numbers for your particular scenario, the important thing is that if you are a collector and you're hiring somebody, make sure that they know what they're doing and have a good track record and history. Also, if you're a mechanic, make sure you're managing your restorations properly so you don't get into a situation where you're prosecuted.

Look, this mechanic has to pay back $7.2 million, but that's what's called trouble damages. In the state of Iowa, where this happened, if you cause damages through fraud, you have to pay back three times what you took in. So, this mechanic only took in $2.4 million for work over the period of time this happened, but he had to pay back $7.2 million. Now, he's filing for bankruptcy, will end up going to jail, and will face other financial downsides.

So, make sure that if you're a mechanic, you're managing your affairs properly. If you're a restoration client, make sure you get constant updates. If you see things spiraling out of control, maybe consider pulling those vehicles back and either doing it yourself or having another mechanic take over the job.