Two Fox Valley salvage dealers have been ordered to close by state officials who say the businesses broke the law.
The salvage dealer licenses of Gibson Iron Metal and Auto, Inc. in Neenah and Fox Valley Iron Metal & Auto Salvage, Inc. of Oshkosh were revoked by the state of Wisconsin for conducting fraudulent activities. The order, issued by Brian Hayes, Administrator of the Wisconsin Department of Administrations Division of Hearings and Appeals, determined the two motor vehicle salvage dealerships were in violation of state law.
The announcement by the Wisconsin Department of Motor Vehicles comes less than three months after the former owner of both businesses, Sterling W. Kienbaum, was sentenced to 11 years in prison on racketeering and theft charges for a multi-million dollar scrap metal scheme. Prosecutors say Kienbaum loaded scrap vehicles with dirt to increase their weight, then delivered the vehicles to Sadoff Iron & Metal Co. in Fond du Lac for payment.
Sadoff unknowingly paid millions of dollars to Kienbaum for dirt over a period of time from 2009 and 2015, according to court documents.
The judge ordered that the two salvage dealerships must immediately cease purchasing scrapped motor vehicles but will be allowed a wind-down period for the companies, which have approximately 50 employees. Fox Valley Iron Metal and Gibson Iron Metal have until the end of the year to sell, process or recycle the auto bodies and parts from motor vehicles it already owns.
The Wisconsin Department of Transportation’s Dealer and Agent Section licenses, regulates and resolves disputes about dealership sales and warranty repairs as well as educates the motor vehicle industry and public. It also investigates complaints about odometer tampering involving dealerships and private sellers.
