In his Colerain Avenue office, at Hyde Park Country Club or at Christ the King Church in Mount Lookout, Harry Hocks Jr. was ever the car salesman.

        Son of the late, longtime Buick dealer Harry Hocks Sr., Mr. Hocks followed his dad's footsteps into the auto business. By 1960, he was one of the top car salesmen in the country.

        Even after selling Hocks Buick in 1984, he continued to peddle cars to a loyal clientele of doctors, business owners and retirees.

        Not anymore. Mr. Hocks, believed to be in his 70s, has been accused of swindling many of those clients. His company, Harry Hocks Leasing, has all but vanished. Both were brought down in a legal tangle that involves two of Cincinnati's biggest banks, the city's biggest auto dealer and customers who thought — incorrectly — that they owned the cars they obtained from Mr. Hocks.

        That's the nasty legacy of what began this past summer as a pair of run-of-the- mill loan default cases filed against Mr. Hocks by Fifth Third Bank and Firstar Bank. The banks obtained quick court judgments for $2.6 million and the right to repossess the cars. But because most of Mr. Hocks' customers had paid for the cars with cash, both they and the banks want the keys.

        “I'm devastated,” said Peter Cardullias, a University of Cincinnati professor who was referred to Mr. Hocks last year and obtained two vehicles. “I'm out $28,000 plus the payments I've made, and that's a big chunk of change.”

        The banks are taking different tacks in resolving the crisis. Firstar, out the most money — $1.6 million — filed suit against 74 people who possess the cars it has liens on, including Mr. Cardullias. Fifth Third is working out ownership and compensation on a case-by-case basis with more than 90 people — out of court.

        Leo Grosser, owner of a consulting engineering firm in Highland Heights, went before Hamilton County Common Pleas Judge Steven Martin on Nov. 9 to fight Firstar for the Buick Park Avenue he bought from Mr. Hocks for $26,100 in 1998. On the witness stand, he expressed no animosity for the man who'd sold him cars for 25 years.

        “Harry Hocks was, to me, one of the most trustworthy men I ever met — up until all this happened,” Mr. Grosser testified.

        Last Friday, the judge gave Mr. Grosser three days to surrender his car until the case is final.

        Efforts to reach Mr. Hocks, who lives in a modest condominium in Hyde Park, were unsuccessful. He changed his telephone number to an unlisted one. His lawyer, Don Rafferty, would not consent to an interview. When the banks sought his testimony in court, Mr. Hocks invoked the Fifth Amendment.

        This much is known: In May, Joseph Automotive, the city's biggest auto retailer, locked Mr. Hocks out of his office of 17 years at Joseph Buick-GMC on Colerain Avenue, according to Mr. Hocks' response to the Joseph lawsuit.

        But where the money went remains unclear. By all accounts in the legal battle, Mr. Hocks is broke.

        “We haven't found a palatial home anywhere or anything like that,” said Doug Tripp, a Cincinnati lawyer representing Firstar. “The issue is whether he's got any nonexempt personal property that's worth anything. But he's stonewalled us in our attempts to get any information from him.”

        Said Alan Statman, who represents Fifth Third Bank: “His attorneys tell us he doesn't have anything.”
       

Cash flow

        Mr. Hocks' financing deal with Firstar goes back to 1995, when Harry Hocks Leasing obtained a revolving credit line to bankroll its auto-leasing operation. The bank loans would be used to buy vehicles. The debt would be paid as customers made monthly lease payments.

        In March 1999, Fifth Third provided additional financing in the form of a credit line that eventually reached $1 million. It, too, was of the understanding that Mr. Hocks would be leasing the vehicles he bought, mostly from dealerships owned by Joseph Automotive.

        Consumers heard a completely different pitch.

        According to interviews with six Hocks customers, lawyers suing Mr. Hocks and the Firstar lawsuit, customers thought they were buying vehicles from Mr. Hocks. Most, in fact, paid cash. Most were older people who had bought cars before from Mr. Hocks or his father.

        The buyers, though, did not walk away with a title. At Mr. Hocks' suggestion, the customers agreed to let him keep the titles in his name. It was an attractive option. In exchange for letting Hocks Leasing reap the tax benefits of depreciation, the buyers wouldn't have to pay state sales taxes on the cars. Mr. Hocks also offered a discount on the sticker price and to take care of their registration renewals. One customer interviewed said Mr. Hocks offered to surrender title upon his request, leaving him with the responsibility of paying whatever sales tax was due.

        That left Mr. Hocks with the matter of presenting the banks with lease documents, not purchase contracts. To do so, Firstar and the car buyers contend in their lawsuits, Mr. Hocks forged customers names on bogus lease documents.

        In effect, the lawsuits claim, Mr. Hocks received payments from both the banks and from the customers.

        The scheme collapsed early this year when Mr. Hocks quit making payments on the bank loans.

        “This could have been going on for years,” Mr. Statman said. “He just couldn't generate enough cash flow to keep it alive.”

Locked out

        Mr. Hocks' problems also soured his longstanding relationship with Joseph Automotive. After Joseph bought Hocks Buick in 1984, it provided Mr. Hocks an office, a supply of vehicles and, in February, a $138,008 loan, according to the lawsuit. When Mr. Hocks fell behind on his payments, he was locked out of his office and was sued. A civil judgment was entered against him for the debt.

        The Joseph family was as taken aback by Mr. Hocks' problems as anyone, they said through their attorney.

        “They were very surprised to find out he wasn't doing business as agreed,” said Bill Coley II, who represented Joseph in court. “They hope he makes full restitution to everybody involved.”

        As the banks ponder the recovery of their combined $2.6 million, all eyes are on the collateral: the cars. The buyers, understandably, don't want to give them up. The banks, equally understandably, don't want to give them up, either.

        Firstar's approach was to take the holders of its disputed vehicles to court, which has forced Mr. Hocks' customers to hire legal counsel. Mr. Tripp, Firstar's lawyer, said the bank is simply exercising its legal remedies.

        “The vehicles themselves are the collateral for the loan from Firstar to Hocks Leasing. The vehicles are still owned by Hocks Leasing,” Mr. Tripp said.

        Firstar worked out some of the disputes before suing the 74 holdouts. The parties continue to talk.

        “We sent out letter after letter after letter and spent hundreds of hours on the telephone with these folks to resolve the issue,” Mr. Tripp said.

Sharing the loss

        Fifth Third has refrained from starting a court battle with the 90 or so people holding its collateralized cars.

        “We're successfully negotiating on a case-by-case basis, and we've been able to satisfy everyone as much as anyone can be satisfied in a fraud situation,” Mr. Statman said. “It's not a home run for the end user, and it's not a home run for the bank. We're trying to share the loss.”

        Cincinnati lawyer Hans Zimmer represents about 50 of the car buyers, including Mr. Grosser, in their legal fight with Mr. Hocks and Firstar. He saluted Fifth Third for its handling of the delicate affair.

        “They have taken the position that, while legally they have a relatively strong argument, they're willing to negotiate a fair deal with consumers,” Mr. Zimmer said. “They're taking into account their status as a good corporate citizen and their recognition that the bank and consumers are two victims of the same fraud.”

        As it sinks in that Mr. Hocks doesn't have the money to repay everyone, questions are now being asked about the possibility of criminal charges being filed. The Ohio Bureau of Motor Vehicles said it is investigating the matter, but has no criminal authority. The Ohio Attorney General's Office, which has undertaken auto retailing fraud cases in the past, would not confirm or deny an investigation of Mr. Hocks.

        Mr. Cardullias, who teaches students to work with the disabled, just shakes his head at how a visit to a reputable car lot representing a reputable manufacturer could result in financial disaster. He said he is dismayed by the lack of oversight by Mr. Hocks' partners in business.

        “I'm amazed that people didn't know what was going on since he was doing it so long,” Mr. Cardullias said. “This did not happen overnight.”

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