Colorado charged Charles Backhaus in March 1999 with swindling thousands of dollars from elderly people in an insurance scam.
To prevent any more victims, the state also revoked his insurance sales license in April 1999.
A month after that, the state gave him a license to sell cars.
Later, after Backhaus pleaded guilty to the scam in mid-1999 and a single charge of felony theft from an at-risk adult – an automatic disqualifier for anyone wanting to obtain a state-issued car-sales license in Colorado – the Motor Vehicle Dealer Board let him keep working.
A judge had ordered Backhaus, 52, to repay more than $110,000 he had swindled from a number of elderly people in the elaborate scam, El Paso County court records show. His earnings from car sales were his way to pay back his victims.
“He still owes me a great deal of money, but I wouldn’t buy a roll of toilet paper from him,” said Arthur Brisendine, an 82-year-old farmer from southeast Colorado who lost more than $18,000.
Eight senior citizens paid tens of thousands of dollars into bogus annuities Backhaus sold them from 1996 to 1999, state records show. The state Division of Insurance revoked his license in April 1999, and the attorney general prosecuted him.
In return for a guilty plea to a single count, eight other felony theft charges were dismissed. When Backhaus agreed to repay the stolen money, a six-year prison term was also set aside.
At the time of his plea, Backhaus already had a job: selling cars in Colorado Springs under a license issued him in May 1999.
Backhaus did not return several telephone messages from The Denver Post, and Phil Long officials say he stopped working there in late August.
Dealer board secretary Kirk Martelon made note of Backhaus’ conviction in a memo to the board in October 1999, five months after Backhaus was licensed: “This is a mandatory disqualifier. Offer a stipulation to a voluntary surrender and revocation of license.”
It should have been a slam- dunk. It wasn’t.
Nine months after his guilty plea, the board only suspended Backhaus’ salesman’s license for 30 days and gave him a probationary license, board records show.
No one involved with the case can recall how Backhaus kept his license. Not the board, not Martelon, not the lawyers involved.
“I can’t conceive how that happened,” said Mark Striegnitz, a board member since 1997 and owner of Mark’s Auto Sales. “The name sounds familiar, but there are so many. As far as I know, a mandatory (disqualifier) is the easiest decision to make.”
Colorado’s Auto Industry Division director Robert Sexton concedes that Backhaus’ conviction should have prevented him from being licensed long ago.
In March, Backhaus was before a judge for a third time since his guilty plea to explain why he still owes more than $94,000 to his victims and why he shouldn’t be sent to prison.
The judge placed Backhaus on another six years’ probation and ordered him to pay $300 a month to the bank trust of his victims, at least one of whom has since died.
What of his license to sell cars?
State computer records used to track a salesperson’s license show no indication Backhaus was ever placed on probation, was ever suspended or was required to prove he had paid restitution as the board had ordered. He has not been named in any complaints to the board.