Former Car Dealer Sentenced for Fraud

The former owner of a southern New Jersey car dealership will not have to serve a federal prison term for operating a scheme that defrauded customers and lenders.

The Press of Atlantic City reports Harry Klause will instead serve three years probation and four months of house arrest.

Klause, the president and manager of Ocean City-based Harry Klause Cars and Trucks, had pleaded guilty in August to a complaint charging him with wire fraud.

Prosecutors said the 64-year-old Ocean City man would buy trade-in vehicles from customers and apply the purchase price against the cost of vehicles those customers bought. He also agreed to pay off existing loans those customers had on their vehicles.

However, he didn't do so in a timely way, causing damage to customers' credit scores.

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Copyright AP - Associated Press
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