Bloomington-based Walser Automotive Group will pay $490,000 to the State of Minnesota to resolve a felony tax evasion case that accused the dealership network of using Montana shell companies to disguise brand-new luxury vehicles as tax-exempt used cars. The settlement, finalized this week, ends criminal charges filed against the company in Hennepin County in January without Walser admitting any wrongdoing.
According to a criminal complaint reported by FOX 9 Minneapolis-St. Paul, prosecutors alleged that Walser Automotive worked with Montana-based limited liability companies to make new cars appear used, avoiding Minnesota's motor vehicle sales tax. Investigators said the arrangement centered on independent broker William Frederick Ward, 59, who purchased high-end new vehicles for Walser-related transactions and then requested that titles and paperwork be placed in the name of a Montana LLC. Montana charges no motor vehicle sales tax at all, a gap investigators described as a well-established tax avoidance tactic.
How the Montana Shell Company Scheme Allegedly Worked
Court filings cited by MN Crime describe Walser Automotive Group as headquartered in Bloomington, distributing its used-car inventory through Walser Preowned Sales LLC, which holds licensed facilities in Edina and Eagan. Per the criminal complaint, Walser Automotive gave Ward permission to buy cars in the name of Green Hornet Holdings LLC, a Montana entity the company formed after an earlier vehicle-purchasing entity, Walser Investments LLC, was placed on General Motors' known exporter list. That blacklist, according to industry context reported by FOX 9, is a tool manufacturers like GM use to block brokers and dealerships from buying new domestic vehicles meant for grey-market export. Walser Investments LLC was solely owned by Ward, and he was reportedly the only Walser vehicle purchaser who used Montana LLCs for these purchases.
Once the vehicles arrived, Walser Preowned classified them as used and tax-free under its used motor vehicle dealer license, per the complaint, then sold them to buyers Ward had already lined up. Investigators said the vehicles sold to those end buyers were apparently never placed in operation and carried odometer readings identical or nearly identical to their initial acquisition mileage. The complaint also states that Walser sometimes leased cars to employees for a few months before taking them back and reselling them as used, a method one Walser witness described as a way to generate used-car inventory.
The Legal Line Between New and Used
Minnesota law defines a vehicle as used only after its title transfers from the person who first acquired it from the manufacturer and the vehicle is actually placed in operation, rather than held solely for resale. That statutory threshold, reported by FOX 9, is precisely what investigators said Walser's scheme violated by treating zero-mile cars as used inventory. The Minnesota Department of Revenue notes that the state's motor vehicle sales tax rate rose from 6.5% to 6.875% in July 2023, a rate applied to all vehicle title transfers statewide.
Charging documents reported by KARE 11 put the scale of the alleged scheme at $350,745 in avoided taxes across 34 luxury vehicle transactions between March 2020 and August 2023. Those same documents tie the timing to post-pandemic market conditions, when high demand and severe inventory shortages let dealers resell new high-end vehicles immediately above sticker price, creating a financial incentive to funnel cars through the tax-free Montana route. Court documents also noted that witnesses gave inconsistent answers about whether and when Ward, his Minnesota corporation, or the Montana LLCs operated under a Walser dealer license.
Denials, Charges Against the Broker, and What Comes Next
Ward and Walser staff members denied, per the criminal complaint, being aware that other Minnesota dealers used Montana LLCs, and they denied that the arrangement was intended to evade Minnesota sales tax. Ward and Walser staff also said buying vehicles through a Montana LLC was simply the only way to acquire cars for resale, and Walser employees denied knowing that Ward sometimes represented himself to dealers as an individual buyer seeking a personal-use vehicle. Ward and Walser witnesses further denied knowing that a new car must actually be placed in operation, rather than held for resale, to qualify as used under state law.
Ward was separately charged in Hennepin County with felony motor vehicle tax evasion and misdemeanor brokering without a license, according to MN Crime, which reported he had operated without a Minnesota dealer license since joining Walser in 2017. That case against Ward remains pending; the settlement does not resolve it. As part of the agreement reported by Richfield Patch, Walser must repay the taxes and penalties within 20 days, establish an internal sales tax compliance committee, submit to three years of random audits by the Minnesota State Patrol, and cooperate in the prosecution against Ward.
Hennepin County court records show the felony case was filed on January 30, 2026, and closed roughly seven months later once prosecutors agreed to drop the charges in exchange for the $490,000 payment — an amount that exceeds the original $350,745 tax estimate to account for interest and civil penalties, per the same court records. Andrew Walser, the company's CEO, said Wednesday that the matter had been resolved with all charges against Walser fully dismissed. The settlement gives the State Patrol explicit authority to conduct unannounced compliance audits of Walser's sales and titling operations for the next three years, a monitoring arrangement meant to prevent any repeat of the scheme investigators outlined.
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