DATE: Thursday, September 4, 1997           TAG: 9709040470

SECTION: LOCAL                   PAGE: B5   EDITION: FINAL 

SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER 

DATELINE: HAMPTON                           LENGTH:   71 lines

TESTIMONY: CRUMPLER HAD OLDER PARTS PUT ON NEWER VEHICLES FORMER EMPLOYEE SAYS IN A HEARING THAT THE CARS HAD BEEN RETURNED AFTER LEASES.

A former employee of Bob Crumpler's Denbigh Nissan testified Wednesday that the dealer told a worker to have door panels and tires removed from manufacturer-owned cars, replacing them with worn or damaged parts from his own vehicles.

Jack Peirson, a parts manager who left the Newport News dealership last year, said the switches were made in August 1996, after the cars had come off leases. At the time, he said, Nissan owned the previously leased automobiles.

Peirson spoke during a state Department of Motor Vehicles hearing in Hampton that will help determine whether Crumpler can keep his Nissan franchise. The series of hearings, which began in July, continue today.

Nissan Motor Corp. has been trying to end its relationship with the dealer since December, when a videotape of Crumpler uttering racial slurs aired nationwide. Since then, it has alleged that the dealer cheated the manufacturer by doctoring warranty claims.

Peirson testified that Crumpler directed employees to perform free repairs on a customer's Nissan Pathfinder - and then bill the manufacturer for warranty work, even though the vehicle had about 90,000 miles on it. The customer had done a favor for Crumpler, he said.

``Mr. Crumpler was very specific,'' Peirson said after his testimony. ``He would tell us to fix the car but not send him the bill.''

After receiving a tip from one of Crumpler's employees, Nissan dispatched its auditors to the Newport News dealership in January, said Dave Burrows, a regional fixed operations manager for the manufacturer.

Nissan's investigators looked at 240 warranty claims from 1995 to 1996, finding 40 that looked questionable, Burrows said.

For example, the dealership claimed it had replaced an engine on a vehicle on Sept. 13, 1995, when its speedometer read 54,770 miles, he said. But 11 days earlier, the same car had about 83,400 miles on it, Burrows said.

Nissan paid $3,290 on the claim.

In many cases, Nissan said, it was unable to track down the customers who owned cars with questionable repair work. Burrows blamed the dealership in part for ``switching'' addresses and phone numbers.

When auditors requested additional information from Crumpler, they were not permitted to enter the building, Burrows said, saying that Crumpler also did not give Nissan's attorneys information on several other rental-car claims.

Crumpler attorney Bill Lehner denied that the dealership had attempted to withhold documents. He said the information on rental bills already had been sent and would be sent again.

While the dealership may have erred on some claims, Lehner said, that doesn't indicate calculated fraud. For example, workers might not have realized that Nissan had changed a rule in 1995 allowing its dealers to charge less to make certain repairs involving oil leaks.

As for the ``phantom'' customers: ``We can locate these people,'' Lehner said. ``I don't know why they can't.''

Nissan has sought to bolster its case with testimony from a key witness, James Edward Allison, a former service manager at Crumpler's dealership. But Allison has been a no-show, and a Newport News Circuit judge issued a warrant for his arrest last month.

James Mollica, the manufacturer's attorney, said Allison's son, Todd, also has been subpoenaed. A Nissan investigator, in court records, said he was unable to track down the elder Allison.

Last week, the younger Allison dropped off the key to his Newport News apartment and moved out without notice, according to neighbors and employees at the rental complex.

It wasn't immediately clear why the Allisons did not want to testify. ILLUSTRATION: Bob Crumpler is fighting efforts of Nissan Motor Corp.

to take his Newport News dealership franchise from him. KEYWORDS: RACISM TESTIMONY HEARING

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