What The Hell America!

This year, the head of Connecticut’s Department of Motor Vehicles made a startling public admission, telling lawmakers that the agency, which regulates the towing industry, has never enforced a century-old law meant to protect drivers whose cars are towed.

Under that law, if vehicle owners don’t reclaim their towed cars or can’t afford the fees, towing companies can sell them, but they are required to hold onto the proceeds for a year so the vehicle owner can claim the money. Tow companies are entitled to subtract their fees. But, even if the owner still doesn’t come forward, the companies aren’t supposed to pocket the profits and must turn over any remaining money to the state.

DMV Commissioner Tony Guerrera told lawmakers the agency had never set up a process to accept deposits and wasn’t tracking whether any money had come in.

In fact, the DMV commissioner said he wasn’t aware of that part of the statute until The Connecticut Mirror and ProPublica brought it to his attention last fall as part of an investigation into how Connecticut’s laws favor towing companies at the expense of drivers. After the story’s publication, the state treasurer’s office audited its deposits and determined that no tow truck company or the DMV had ever turned over money from sales in the history of the law.

In a statement, Guerrera said, “This law has been in effect since the 1930’s, yet unfortunately, there has never been a system in place to effectively monitor its implementation.”

This failure has hurt both vehicle owners and the state itself: Owners don’t have the opportunity to get money back that the law says should be theirs, and the state is missing out on both the potential payments and any interest or investment income that would accrue from the deposits.

The unenforced law is another example of how the DMV has failed to oversee the towing industry, which sells thousands of cars following tows each year. In an extreme case, reported by the news organizations last month, a DMV employee was found to be part of a scheme to undervalue cars and sell them for thousands in profit, according to an internal DMV investigation. The employee denied he did anything wrong and still works at the DMV.

In another, criminal court records show, a Norwalk towing company owner was caught driving a Mercedes-Benz he had towed, racking up nearly 6,000 miles in 22 months. The tower was charged with larceny and participated in a diversion program, after which his record was expunged. CT Mirror and ProPublica have spoken to dozens of people who had their cars towed and never saw them again. Many said they weren’t notified that their cars would be sold.

Legislators are now aiming to create a system to make sure car owners — or eventually the state — get that money. A wide-ranging bill to overhaul the entire towing statute would require towing companies to submit documentation to the DMV of the sale price, any towing and storage fees they incurred and information on the vehicle and its owner within 15 days of a sale.

The bill would also reform the process of “escheating,” or remitting money to the state. After reviewing the sale document, the DMV would require the tower to send a certified letter notifying the owner or lienholder of the sales proceeds. Instead of the general fund, leftover money would be sent to the state’s unclaimed property fund and appear on a publicly posted list.

Guerrera said the DMV recently added more staff charged with overseeing the sales system and added a section to its website this year to ensure tow companies are aware of the requirement to turn money over to the state.

During an interview late last year, Guerrera said that implementing the process wasn’t the DMV’s responsibility and that doing so was up to the state treasurer’s office. But the treasurer pushed back on that in a statement, saying it fell under DMV rules. After the initial CT Mirror and ProPublica story was published, Guerrera took more ownership.

“I am glad this has been brought to my attention and I am more than prepared to address this issue, ensuring that it is now being handled properly and in accordance with its intended purposes,” he said in a statement.

The Transportation Committee approved the bill on March 19, sending it to the House. Some lawmakers opposed it, arguing the bill was intended to target a “few bad apples” but adds unnecessary regulations on all towing companies.

House Speaker Matt Ritter, D-Hartford, said he expects lots of debate as the bill winds its way through the legislature, but he said the escheating process needs to be addressed.

“There’s got to be some accountability and transparency on that for sure,” Ritter said. “This is people’s property.”

Timothy Vibert, president of Towing and Recovery Professionals of Connecticut, said a past association president asked DMV officials about how to return funds to the state but received no answers.

He said tow companies rarely make back their towing and storage fees when they sell cars and questioned why any tower would ever give the state money.

“There might have been a little bit of a windfall with one car or another, but there’s been a whole lot of losers, so why does the state get a chance to take it?” asked Vibert, who owns Farmington Motor Sports.

He added that many towers would rather return the cars.

“What the towers are doing is keeping those cars and then just getting rid of them for $500 or $600,” Vibert added. “So we’re keeping the cars for, I’m going to guess 45 days, maybe sometimes 50, depending on the paperwork, and then we’re just disposing of them because they’re not worth anything.”

House Minority Leader Vincent Candelora, R-North Branford, said he thinks there usually isn’t money left over after fees. “I think, frankly, what usually happens is the tow companies wait for the towing and storage fees to exceed the value, so it never ends up going to the state or back to the individual,” he said.

Kristianne Hall experienced the fees piling up firsthand while she was bartending in downtown New Haven. The job posed a delicate balance. She had to work her shift and offer sufficient service to get good tips. But she also had to keep the parking meter fed. There were a few times Hall couldn’t get to the meter, and parking tickets stacked up.

In 2015, her car got booted and then towed when she couldn’t afford to pay the $500 to get the device taken off. By the time she had that money saved, she said, the towing company quoted her $2,000 to get the vehicle back from its lot.

Hall couldn’t afford that and never saw the car again. She estimated the 2008 Chevrolet Aveo was worth about $5,000, which is supported by a Kelley Blue Book report, thousands more than what the towing company told her she’d need to pay to get it back.

“Why was I not entitled to the rest of that money if I own that car outright?” she asked.

After the tow, Hall struggled to get to and from work. She had to take an Uber home because the city bus stopped running before her shifts ended. She quickly ran low on money and had to turn to her roommates to help her pay bills before she eventually moved in with her grandparents in Florida.

“I felt like a failure because I couldn’t hack it,” Hall said. “It was a really, really hard and almost traumatic situation.”