A week after their company was reinstated to work for the Mobile Police Department (MPD), the owners of SOS Towing were arrested by investigators on allegations of insurance fraud.
According to an MPD spokesperson, officers executed a seizure warrant at SOS Towing Tuesday based on information the company was charging fees “above those regulated by municipal ordinance.” Owners Gary Lamar Smith Sr. and Gary Lamar Smith Jr. are now facing eight counts of first-degree insurance fraud and two counts of second-degree insurance fraud.
In Alabama, first-degree insurance fraud means the loss or potential loss exceeds $1,000.
This latest development comes as city officials are beginning to rewrite the“ancient” municipal ordinance that brought some local companies to the brink of closing and has now led to arrests.
Today’s raid at SOS Towing comes less than a week after the company and four others were reinstated to the MPD’s rotating list of wrecker services after a 60-day suspension for allegedly violating the same city ordinance.
Police opted not to seek an addition suspension against the companies due to growing pushback from the Mobile City Council, which is tasked with hearing appeals of those suspensions under city law.
Throughout that entire process, those companies — including SOS Towing — have accused other towing companies of violating the same ordinance and the MPD of being selective in its enforcement.
As Lagniappe has reported, some of the suspended companies specifically made allegations against Pitts and Sons Towing in Saraland, which has been accused of overcharging but not facing any scrutiny from MPD.
A representative from SouthPort Towing presented councilors with a Pits and Sons invoice last week that appeared to show improper charges collected earlier this year, and some have questioned why it hasn’t faced the same suspensions, raids and investigations that other, smaller companies have.
Ironically, it was Pitts and Sons that hauled away four SOS wreckers seized today in MPD’s raid.
In recent weeks, some members of the council have also expressed similar concerns that MPD appears to picking and choosing who faces consequences for violating a confusing ordinance that its own employees yard failed to comply with for years.
“It seems to me the city is continuing to focus on certain groups, but refuse to act on others,” Councilman Fred Richardson told Lagniappe Tuesday. “All violators should be treated the same.”
Richardson added that he’s not saying those accused have not violated the ordinance, but he believes everyone should be treated the same way.
He also said he believes the MPD is purposely ignoring violations from other towing companies — including some that were documented by representatives of the suspended towing companies and presented to members of the City Council last week.
Police did not offer much information about what led to the raids and arrests at SOS Towing today, even though only days ago MPD officials suggested to council members and local reporters that their investigative findings would be presented to local prosecutors before any criminal charges were brought.
SOS Towing has also played a somewhat usual role in this entire investigative saga because of J.C. Smith — a former employee of MPD’s impound yard, who is the brother of Gary Smith, Jr. J.C. Smith also operates the South Alabama Towing and Recovery Association with his wife, Crystal.
That association has been instrumental in some of the information that has become public about the internal investigation MPD launched once officials realized the department’s own impound yard overcharged motorists for years including for fees that aren’t allowed under the city ordinance.
Reached by Lagniappe, the Smith family directed all inquiries to their attorney, Michael McGovern, a Tennessee-based attorney that specializes in cases involving tow truck companies. More information will be added to this story as it continues to develop.
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