MASON CITY | The owner of a Mason City car dealership pleaded guilty to money laundering in federal court, documents said.
Jerry T. Flaherty, owner of Wheel Man Auto in Mason City, was the subject of an undercover investigation.
According to court documents, there is a proposed plea agreement though the details of the agreement are unclear.
Penalties for money laundering could result to up to 20 years in prison without the possibility of parole, a period of supervised release following prison of not more than three years and a fine of not more than $250,000.
A man answered the phone Friday at Wheel Man Auto but he did not identify himself. The man said Flaherty would be “gone until Monday” and that he had no comment on the federal charges.
According to court documents available on a public database, the incident of money laundering occurred on April 6, 2014.
One month earlier, on March 6, an undercover law enforcement officer met with Flaherty at Wheel Man to discuss a vehicle purchase. The conversation between the two was recorded.
“Now this ain't no credit card. I just, you know, I just sell weed and cocaine, and I'm back and forth doing some things,” the officer said, according to detailed accounts of the exchange in court documents. “And I just don't want to cause no problem. You said them credit card things?”
Flaherty told the officer that cash and a “cash deal is fine with me.”
“Yeah. I may just get, I might look at that 300, but I just don't want the government forms to file,” the officer told Flaherty. “I just don't want anything in my name so.”
The undercover officer then left without purchasing a car.
The officer and a second undercover law enforcement officer returned April 8 to Wheel Man. After talking for a time with Flaherty, the two officers went to Flaherty’s house in Mason City.
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While there, the original undercover officer and Flaherty agreed that the officer would purchase a car for $20,500 cash, “money which defendant believed was proceeds from the sales of illegal narcotics,” court documents said.
The two also agreed to put the car in the other undercover officer’s name so that it would not be in the original officer’s name. Flaherty agreed to record the sale as a $15,000 credit card sale instead of a $20,500 cash sale.
“You know my deal. You know I sell cocaine and my thing is I just don't need no...government forms,” the original undercover officer said.
“I'd actually like to make that f---ing paper disappear because I'm getting f---ing, (sic) I show I made 200,000 this year already on paper,” Flaherty said. “But it's all on the computer. I can't, you can't hide it, it's all everything I f---ing do.”
The officer paid in cash for the car, and Flaherty did not fill out the required government reporting form.
'Not likely to flee'
Flaherty owned Wheel Man Auto, LLC between at least 2010 and Sept. 2015, according to court documents.
He is listed as the “Manager” of Wheel Man Auto LLC as of March 2017 with forms filed with the Iowa Secretary of State. In documents from February 2015, a woman is listed a “President” with no mention of Flaherty.
Flaherty is listed as the owner of the property at 1201 S. Federal Ave. where Wheel Man Auto is located, according to property records.
He entered a guilty plea as part of a plea agreement in court Oct. 25 and was released from federal custody.
“I found by clear and convincing evidence that Defendant is not likely to flee or to pose a danger to the safety of any other person or the community,” United States Magistrate Judge Mark A. Roberts said in court documents filed Oct. 26.
No court date has been set for sentencing.