A California auto dealer abruptly closed most of its locations this past week without explanation, leaving employees unable to cash their paychecks amid rumors of a possible sale. But records filed in an ongoing fraud case brought by the Securities and Exchange Commission offer some insight as to the possible root cause: the dealership’s owner has been struggling to grapple with an immense load of debt, Jalopnik reported. A report from the Daily Republic in Solano County, California, first broke word of the closures on Friday, confirming six of the seven dealerships owned by Momentum Auto Group had closed up shop. A day later, a local ABC affiliate reported a seventh dealership had closed, with some locations posting signs that read “closed until further notice,” while others said “out of business.” It wasn’t immediately known how many workers might be out of a job at this point, nor if the closures are even permanent. Records indicate that Momentum employed about 300 workers in the area. But what’s clear from records in a separate, ongoing SEC case is that Momentum’s owner, Rahim Hassanally, has spent months trying to address an enormous debt load associated with the dealer group. And while records indicate a sale was in the works, he now finds himself caught up in the fallout of the SEC’s investigation.
