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MASON CITY – A Mason City auto dealership owner has entered a guilty plea to the federal crime of laundering drug money and now faces massive fines and decades behind bars.
According to documents obtained by NIT from the United States Attorney’s Office in the Northern District of Iowa, on or about April 6, 2014, in the Northern District of Iowa, defendant Jerry T. Flaherty, with the intent to conceal and disguise the nature, location, source, ownership, and control of property defendant believed to be the proceeds of specified unlawful activity, did knowingly conduct and attempt to conduct a financial transaction affecting interstate or foreign commerce involving property represented by a law enforcement officer, to be proceeds of specified unlawful activity, to wit: the distribution of controlled substances, including cocaine and marijuana, in violation of Title 21, United States Code, Section 841(a)(1). This was in violation of Title 18, United States Code, Section 1956(a)(3)(B).
According to documentation forwarded to NIT:
Between at least 2010 and September 2015, defendant Jerry T. Flaherty owned Wheel Man Auto, LLC (hereafter “Wheel Man”), a car dealership located in Mason City, Iowa. On March 6, 2014, an undercover law enforcement officer (hereafter “UC1”) went to Wheel Man and met with defendant to discuss UC1 purchasing cars. The conversation between UC1 and defendant was recorded. During the conversation between defendant and UC1, the following exchange occurred:
UC1: Now this ain’t no credit card. I just, you know, I just sell weed and cocaine and I’m back and forth doing some things. And I just don’t want to cause no problem. You said them credit card things?
Defendant: Cash-cash deal is fine with me, that’s.
UC1: Yeah. I may just get, I might look at that 300 but I just don’t want the government forms to file. I just don’t want anything in my name so.
UC1 left Wheel Man without purchasing a car on March 6, 2014.
On April 8, 2014, UC1 and a second undercover law enforcement officer (hereafter “UC2”) returned to Wheel Man and met with defendant. After talking for a time at Wheel Man, defendant, UC1, and UC2 went to defendant’s house in Mason City. While at defendant’s house, UC1 and defendant agreed that UC1 would purchase a car for $20,500 cash, money which defendant believed was proceeds from the sales of illegal narcotics, a specified unlawful activity under 18 U.S.C. § 1956(c)(7). UC1 and defendant also agreed to put the car in UC2’s name so that it would not be in UC l’s name. Defendant also agreed to record the sale as a $15,000 credit card sale instead of a $20,500 cash sale.
The conversation between UC 1, UC2, and defendant at defendant’s house included the following exchange:
UC1: So how much I owe you now?
Defendant: 20,500
UC1: You know my deal. You know I sell cocaine and my thing is I just don’t need no, them government forms. So how did, how did you even pay for it anyway? I just want to make sure.
Defendant: 15,000 on a credit card.
UC1: Oh, perfect. We’re good. I’m just going to let you count. I know.
Defendant: I’d actually like to make that fucking paper disappear because I’m getting fucking, I show I made 200,000 this year already on paper. But it’s all on the computer. I can’t, you can’t hide it, it’s all everything I fucking do.
UCI then paid defendant $20,500 in cash for the purchase of the car. Defendant did not fill out the required Form 8300 government reporting form pursuant to 31 U.S.C. § 5331 and 31 C.F.R. 103.30(a)(1).
An Assistant United States Attorney tells NIT that “Mr. Flaherty was charged in federal court in Cedar Rapids on October 17 with one count of Money Laundering. He pled guilty to that charge on October 25. The next step in the case is a sentencing hearing, but that has not been scheduled yet.”
Flaherty will waive Indictment and plead guilty to one count of money laundering, in violation of 18 U.S.C. § 1956(a)(3)(B), punishable by the following maximum penalties:
(1) not more than 20 years’ imprisonment without the possibility of parole;
(2) a fine of not more than $250,000;
(3) a mandatory special assessment of $100; and
(4) a term of supervised release of no more than 3 years.
Hmmmmm one known drug and guns guy hauled off so far. One down more to come. Are they all related??? Hmmmmm
When is sentencing date ? Any updates???
No updates, no sentencing date set.
What do you think the Feds found when they did the sting 4 years ago????? NOTHING. It was obviously a mistake on Jerry’s part but one incident in all the cars he has sold I dont think merits the punishment. Some federal agent somewhere looks like a moron as they went through all his files and didn’t find anything. Now taxpayers are on the hook for way more than the 250 dollars he avoided collecting in taxes. Seems like a stout fine and educating home on what not to do would be more sensible. Their isntba car dealer in north iowa that hasn’t taken drug money or marked a car down Andrew thousand to make a deal. So put Jerry in jail for 50 grand a year and think of the revenue he generates in mason city at parts houses. Repair shops. And taxes. Probably Costs 500,000 for a 250 dollar mistake. Makes sense dont it?
Nah not really. Feds had to have had sufficient evidence to get s sting op even approved. If they went through the books 4YEARS AGO and found nothing then it would have been charged and taken care of 4 YEARS AGO. Most likely more to this, especially since there’s a plea agreement. Now that makes more since.. don’t it
Whats up with the construction company selling cars, and motorhomes as well as construction equipment at their business across from burks and scottys. Seems he always has something for sale. Wonder if he pays taxes on anything he makes a profit on?
They, feds probably don’t have prior evidence of that guy laundering drug money. Or lowering bought price to avoid taxes. Most don’t admit to laundering drug money to strangers.
I bought a set of tires and nice chrome rims from him this last summer. He just laughed when I asked him for a reciept. This was a cash deal. He’s got a personality of a rock. To bad loser
I guarantee that Flaherty has been cooperating with the Feds for the last 4 plus years, and a large amount of arrests are in the making. Anyone that associated with Flaherty should be scared.
Talking about money laundering – went to an auto auction in des moines to drive a car home for a dealer – while he was at the counter paying for it I observed the counter next to his and watched for maybe 10 minutes as maybe 6 Mexicans came to the counter to pay cash (cash counter) one vehicle alone was over 20k and he just reached into his pocket and drug out a wad of 100’s and stacked them on the counter to pay for it – there were 2/3 more standing there counting out cash also . ?????
Which auction house was it, the next time I go down there I’m going to watch.
They also probably aren’t telling the auctioneer or cash counter that they are buying said car with earned drug money and asking for a lower price listed so they can avoid taxes. There’s the difference.
You people commenting, wake up !! There’s obviously more to this story. So linked to drug crime, do the feds get to seize the business and all ,cars, property!! ?! Not charged until late 2018, why isn’t he in jail waiting sentencing? there’s way way more to this. Wonder if heads are rolling!
This place has always been linked to drugs and shady deals. Sting operation in 2014. Obviously feds had info on this place about drugs and laundering to even get a sting op approved. Charged Oct 17th 2018 and pled guiltily Oct 25th 2018 ??? Only one charge? Not being held In jail?? Awful fast, all kept quite… plea I’d be wondering what Info was “collected “ from 2014 – 2018 with “help” from this Jerry. Be interesting to see who else ends up going down and for what after this. Including what his sentence will be. Anyone who had shady business deals going on here probably shaking in their shoes when this came out. I doubt feds waited from 2014 until 2018 to just only charge only this guy one measly count.
just jerry? any other employes involved?
Misery loves company
I think someone nailed it when they talked about jealousy. Everyone in Mason City is jealous of anyone doing well, so they try to bring them down by any means necessary. Crap town.
Jealousy? There’s nothing to be jealous about. This wasn’t random. There has to be sufficient evidence for a sting op to even be approved in the first place. Are we all supposed to be jealous of 3 hots and a cot ?
I went into the place and just rude,Jerry is a very rude guy.. thats why i went to pritchers and bought a new tahoe..
Jumping titles on cars is most common on craigslist – or then again using some car dealers license to run your lowballer vehicles thru for a fee. Know your illegal game hillery.
To cast a stone ! How many of you NON licensed car dealers or low baller craigslisters have cheated/composed a lower buying price on a car you bought – probably over 90%. Since craigslist came online with a no fee advertising almost everybody is selling cars. Hell even the rich farmers are in the game as they have the time. Went to look at a 15k car on a farm – presto! he had 3 more vettes in the same barn for sale – one was over 70k. Don’t tell this Goodfella the state is not also getting screwed on tax money by your car flippers – you sound like a liberal always blaming someone else for the same thing you doing. Hypocrites.
Who you yelling at dude? Lol. It is not against the law to buy cars and sell them for a profit. You have no idea farmer with 3 vettes for sale isn’t paying or exchanging title for correct amount of sale for taxes. Feds obviously had enough evidence on Wheelman about people laundering drug money through him and avoiding taxes to run a sting on him. This appears to be more about the drug side of the deal because they charged him with the drug crime of laundering drug money. Otherwise if it was mainly about taxes feds would of charged him with tax evasion. Sting done in 2014 why was he allowed to keep running his business for 4 years? Why wasn’t his assets and accounts frozen after sting op was positive in 2014? Why isn’t he being charged with more counts? Sting op alone should have netted one count laundering drug money plus one count tax evasion. I’m sure if they went thru the books/accounts following each sale checking sale price, title, and amount titled for there’s many more counts could have been charged. Is this this the big fish or just really the little fish? Interesting to say the least.
Quit bashing Jerry he’s a nice guy with the desire to give people a good auto at a great price. Jealousy will get you nowhere but hard work and livin the dream will.
Dealers are always nice when you’re buying something from them.
Car or drug dealers? Or you mean both?
This whole thing is like peeling a onion. The more layers you pull off the more it stinks. This guy is has a lot of similarities to finding your neighbors door crapped in your yard a you step in it.
Your a complete idiot
He says, as he’s looking in the mirror!
I’m surprised he admitted it, and that’s the first step!
*You’re
Whats the Problem?? This guy just didn’t want to pay Taxes. NO ONE say anything about all the Mexican Restaurants that HAVE NO CUSTOMER and they are still on the Market. I know Jerry and he is a good guy. People offend others but never think, that the taxes going to the BIGGEST Thieves : POLITICIANS and BANKERS.
Jerry made his Money WORKING and no Stealing from others. Instead of get accused of Money Laundering he should be charge for Tax Evasion
Your a idiot as Well.
Happened in 2014/2015….old news.
Give him a break drugers need drugs.
And drug dealers need to be exterminated.
Wonder if he will spend anytime in prison? Funny thing. The globe gazette, or Kimt don’t report anything on it??? Strange? I wonder if the globe has done shady shit with wheelman?
I’m buying a vehicle from him. It’s titled to me in my name but he has a lien on it. What are my options? It’s almost paid for.
Regarding being given title with lien and vehicle nearly paid off… What did you ever find out? Thanks
Aw man, I like that guy. Ive bought a lot of great vehicles there for the right price too.
I know people that use to buy drugs from the back of the bussiness all the time.
How about all those Mexican restaurants all over the United States what percent of those are laundering drug money as well as screwing there workers out of there wages !!!!
Don’t forget that these same state regulated casinos allow smoking when the mom n pop bar n grill can’t allow smoking if they choose.
ITS WRONG !!!!
Smoking around food, and drinks is disgusting. You are gross.
You are a Liberal Sissy.
Oh yes, having to eat and inhale your death makes my political backing a specific one. You are also extremely dumb. If it affects someone else, keep it to yourself. You are weak for having to smoke in the first place. The fact no one tells people the need for a pacifier as an asult is a weakness makes me laugh. You are a pussy for needing a crutch.
Still a Whiny Sissy.
They probaly could get all the car dealers in MC if they tried. But most of the big ones got to much money. Never met a car dealer that was honest.
This is hilarious the effort that went into trapping this guy when every day there is millions of drug money laundered at state regulated casinos,
Well I bet people laundering money at Casinos aren’t TELLING casino employees that they are laundering their drug money through them. Lol this guy freely made this deal with strangers, freely talked about drug money being used to purchase vehicle and lowering price so buyer and himself could avoid taxes.
If only they could build a wall to keep these people out! It’s so simple.
TRASH !!!!!!!!!!
Where are all the Mexicans going to buy there cars now?
Johnson’s
For a long time I thought that there was something illegal going on there. All them high dollar vehicles, just sitting there.
THIS WAS ONLY ONE CAR DEAL. JUST THINK OF ALL THE UNDER THE TABLE DEALS DONE THERE. THE GOVERNMENT DONT HAVE ANY CLUE JUST HOW MUCH MONEY WAS NEVER PUT ON TH BOOKS . THEY NEED TO LOOK INTO ALL THESE DEALERS. THE PREY ON LOW INCOME PEOPLE FOR THERE BENEFIT AND DONT PAY TAXES
The police probally busted drug user/dealers and traced the vehicles. Probally found the out that paper work wasnt there and went and checked on them
One less cruddy used lot on seedy south fed
What a greedy stupid idiot I mean here you have 2 individuals telling him the cash is from illegall drug deals and he continued on with the deal knowingly he was breaking the law. No entrapment just greed
I’m confused why did they attempt to buy the car this is probably one of the most obscene things I’ve heard of so apparently out of the blue we have undercover officers they’re trying to purchase things just to test the integrity of somebody who may not have otherwise even committed a crime or be faced with the opportunity to do so? Gross it’s stories like this that gives law enforcement a terrible name and reputation.
I’m sorry but I just don’t see how it’s the merchants responsibility to identify where the money is coming from nor should he have to care.
Pretty sure they had some sort of lead that caused them to do this sting operation. They don’t just decide to go after businesses with out a good reason.
exactly correct, they wouldn’t have searched him out to sting him if they didn’t know that he has done this in the past. The officers just needed the hard proof and evidence.
there are laws against this to stop money laundering for terrorist and drug use. Anything over 10k is supposed to be reported right away.. It is federal law that if the merchant knows that the money was obtained illegally to report it… Not to mention the moral responsibility.
Sounds like entrapment to me.
Not if they has suspicion that he has done this in the past.