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June 21, 2002 02:00 AM

NASCAR racer's dad charged in McCarthy Tire ripoff scheme

Vera Fedchenko, Tire Business staff
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    WILKES-BARRE, Pa. (June 21, 2002) — Luzerne County prosecutors have charged five men—including the father of a NASCAR race driver—in connection with an alleged conspiracy that involved stolen new truck tires and medium truck tire retreads from McCarthy Tire Service Co. Inc. that were then sold at low prices.

    Raymond Balls, a former service technician at McCarthy Tire, was arraigned May 3 on charges that he redirected tires from his employer's warehouse to Ed Spencer's Auto Yard in Salem Township, Pa., and Spencer's Junk Yard/Used Auto Parts in Hunlock Creek, Pa.

    Edgar Spencer Sr. and Edgar Spencer Jr., of Salem Township, have been charged with criminal conspiracy and receiving stolen property. Edgar Spencer Sr. owns Ed Spencer's Auto Yard and is the father of NASCAR driver Jimmy Spencer, according to investigators. Also charged with criminal conspiracy and receiving stolen property are Edgar W. Spencer Sr. and Edgar W. Spencer Jr. of Hunlock Creek, Pa., owners of Spencer's Junk Yard and cousins to the Salem Township Spencers, according to Assistant District Attorney Tim Doherty.

    All five men have been released on their personal recognizance, Mr. Doherty said. Mr. Balls has waived his right to a preliminary hearing, and the charges against him will be forwarded to a county court of common pleas, Mr. Doherty said. Meanwhile, the four Spencers were scheduled to appear before a magistrate June 13 to determine if there is enough evidence to try them. That hearing is continuing into the first week of July, he said.

    “We have been working continuously with McCarthy Tire on this,” Mr. Doherty said. “We're very confident that we will get a guilty plea or conviction on this.”

    Jack McCarthy, owner of Wilkes-Barre-based McCarthy Tire, referred all questions concerning the case to Mr. Doherty. McCarthy Tire is North America's 12th largest commercial tire dealership, according to Tire Business rankings.

    According to police reports, some individuals notified Mr. McCarthy that his tires were being sold at reduced prices at the junkyard. Mr. McCarthy sent an employee to investigate the allegations, and he confirmed that the federal “RDNL” codes given to each retreaded tire at McCarthy Tire were the same as the ones allegedly being sold at Spencer's Junk Yard, the police affidavit stated.

    Mr. McCarthy told investigators that a confidential informant purchased six retreads from Spencer's Auto Yard that bore the dealership's federal codes, but there were no records of purchase of those tires by Spencer's Auto from McCarthy Tire. The company then did an internal investigation, questioned staff and as a result, Mr. Balls admitted to being part of a conspiracy to steal tires from McCarthy's warehouse and deliver them to the two Spencer businesses, the police report said.

    The dealership then turned over its findings to the district attorney's office, which began a formal criminal investigation.

    Mr. Balls told investigators that he had worked at McCarthy Tire since 1993 and met Ed Spencer Jr. in 1994 during a service call, according to the report. Mr. Balls claimed that he was approached by Ed Spencer Jr. to get him some tires. Mr. Spencer allegedly told Mr. Balls, “I'll take anything, but I need these…” and gave Mr. Balls a list of tires he needed for customers.

    Since August 1998, Mr. Balls estimated that he sold in excess of 940 retreads and more than 40 new tires to the Spencer businesses, the report alleges. Furthermore, Mr. Balls said that he had bought four vehicles from the Spencers and, at times, they would exchange payment on the vehicles for tires, the report said.

    No other businesses have charged the Spencers with similar allegations of theft, Mr. Doherty said.

    The loss sustained by McCarthy Tire from the alleged conspirators follows another incident involving a White Haven, Pa., man, Kurt Keiper, who was sentenced to jail earlier this year for writing a bad check for $306,500 to McCarthy Tire on a tire purchase, Mr. Doherty confirmed. The dealership also is suing Mr. Keiper, claiming that he owes the company $850,000 for goods sold to his business, Keiper's Discount Tires.

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