WASHINGTON, D.C. (WRIC) — Federal law enforcement officials announced on Wednesday, Nov. 2 that a partnership between the FBI, Homeland Security and IRS, as well as state and local police executed a coordinated takedown of a nationwide network of criminals who are believed to have processed over $545 million worth of components from stolen catalytic converters.

According to the United States Department of Justice, arrests, searches and seizures taking place in nine states — including Virginia — resulted in a total of 21 people being arrested and charged for their roles in the network.

Catalytic converters are part of vehicles’ exhaust systems and reduce the amount of toxic gas and pollutants that are released into the air. They are particularly enticing to thieves for the following reasons:

  • They contain precious metals such as palladium, platinum, rhodium and others, which are sometimes worth more than their weight in gold.
  • They lack identifying information such as serial or vehicle identification numbers, making them difficult to trace back to their original owners.
  • They can be stolen in less than a minute in many cases.

Because of the perceived low risk and high reward, catalytic converter thefts have increased across the country in the last year. The problem is so bad in Virginia that state police recently announced rewards of up to $25,000 for information leading to the arrests in connection to vehicle thefts.

The 21 people involved in the network have been charged in two separate indictments, one in the Eastern District of California and the other in the Northern District of Oklahoma. Law enforcement executed more than 32 search warrants and seized millions of dollars worth of assets, which include cash, bank accounts, homes and luxury vehicles.

In California, nine people were charged with conspiracy to transport stolen catalytic converters, conspiracy to commit money laundering and other charges. According to court documents, three of the defendants operated an unlicensed business in their Sacramento home from which they bought stolen catalytic converters from local thieves and sold them to DG Auto Parts LLC in New Jersey for processing.

DG Auto was being operated in multiple locations around New Jersey by six of the defendants, who purchased stolen catalytic converters and extracted the precious metal powders from them. The precious metals were then sold to a metal refinery for what is believed to be over $545 million.

According to Phillip A. Talbert, U.S. Attorney for the Eastern District of California, last year approximately 1,600 catalytic converters were reportedly stolen in California each month. California accounts for 37% of all catalytic converter theft claims nationwide.

In Oklahoma, the 13 defendants were charged with buying catalytic converters on the street and selling them to DG Auto, as well as another company. According to court documents, one of the defendants in the Oklahoma indictment was wired over $45 million, another was wired over $13 million and a third was wired over $6 million, all of which from DG Auto.

“This national network of criminals hurt victims across the country,” FBI Director Christopher Wray said in a statement. “They made hundreds of millions of dollars in the process — on the backs of thousands of innocent car owners. Today’s charges showcase how the FBI and its partners act together to stop crimes that hurt all too many Americans.”

“This case is not unique,” Chief Jim Lee of the IRS Criminal Investigation added. “There are real victims here – friends, neighbors, and businesses – and our hope is that today’s arrests will deter similar criminal activity.”