11/1/2009 CEO Letter
Greetings to all of you. I hope your year was manageable (profitable?) as we now look forward to 2010.
I thought I would make you all aware of some scams involving catalytic converters. There are certain converters that some brokers are selling that may not be what they appear to be. As an example, there are some converters that have come into the market from Europe and south of the border that appear very similar to converters here in the states. Many of these converters will have you cussing in German, Hebrew or even Spanish depending on which language you express anger in. We have run assays on many of these and there some that contain no precious metals at all. Of course we had to learn this the hard way through men whose names are not worth mentioning. We will refer to them as RC. Men like RC nd others were kind enough to take our money and then stare in disbelief to learn the product they sell is not what the buyer believes it to be. They repeat this over and over and continue to claim that they are just trying to make a living and did not want to cheat anyone. Believe me – they don’t give refunds.
On Monday October 26th, one of our customers in New England made arrangements to buy several thousand converters from a guy he did not know. Fortunately he called to ask our help in the deal.Upon inspection he immediatly became suspicous because of having many years in the business. Before over reacting he sent us pictures of the material and we immediately recognized it as low grade catalyst. Suspicions confirmed! He could possibly have suffered about two hundred thousand dollars in losses.I would not want to have been in the perpetrators shoes if he had pulled this off on our customer. You see this particualr customer would have taken matters into his own hands and I believe there would have been a few less RC's out there. While many of you may not have sympathy for such people - violence is not the answer.
It is our goal to protect ourselves and our customers from such unethical and immoral scams. In the process we feel it our duty to let even our competitors know what we have seen and experienced. Together, I believe, we can help protect each other and expose those who wish to harm or exploit us. Whether you are our current customer, friendly competitor or other business peer, please accept our heartfelt thanks for considering this message and working with us to promote healthy relationships and rooting out those that seek to defraud any of us.
Sincerely
This reply has been validated but the principals involved cannot be revealed due to pending litigation.
We, too, were defrauded of over $500,000 dealing with one company in China.
I took all precautions to ensure material quality. They sent samples which we had tested (test results were fine), then I flew to China and load-tested several hundred of the cats (again, converters lit up just fine). We then loaded the containers and sealed them with my seals and sent the containers to Ningbo port to await ICP assay results on several of the cats I load-tested and then shipped back to a US lab. The results on those were fine so I released the money and the containers were released.
When the containers arrived in the US, the seal numbers matched but the material inside the containers was different. None of the units I opened to load test while I was in China were in the container, though I personally helped load them into the containers while I was there.
As it turns out, the units which were shipped to me were completely counterfeit. I guess with a little payola they gained access to the containers after I left China and swapped the good units with the counterfeits which they themselves had apparently stamped out in their own factory. This company manufactures aftermarket cats (primarily for Japan and Brazil) and fabricates the shells on-site. We've since determined that a factory with the ability to stamp out aftermarket shells and very good looking counterfeit converters can also stamp fake seals with ease.
We've also learned that I am not their first victim. Unfortunately, neither my Senators or Reps., nor the US State Dept. nor the Chinese Embassy are willing to do anything to help. We have no protection against the Chinese yet if we did this to a Chinese company, our own government would crucify us!
The units were all Toyota, Nissan, and BMW. We contacted BMW and showed them the markings on these units and they said that while these blanks looked quite good, they were definitely not OEM.
All this to say, I believe China is the origin of most of the worthless cats. The low-grade ones come from all over Asia, the Middle-East, South American and the Carribean.
We have stopped purchasing any import units which are trimmed back to the brick. Suppliers pull this trick to remove the tell-tale wire O2 from the low-grade units which are worth about half.