Fake Texas Paper License Plates: A Loophole Causes Trouble

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This problem has cost local and state governments at least $220 million in lost revenue from 2018 to 2021, according to an investigator.

HOUSTON — A New Orleans police officer visiting Houston was fatally shot in the Galleria area in August 2021. The getaway car used by the suspects had temporary tags, which turned out to be fake.

It was not an isolated incident.

There are thousands of paper plates on the road that shouldn’t be. A loophole with the Texas Department of Motor Vehicles has allowed fake car dealerships to print and sell temporary plates.

“Texas is the laughing stock of paper plates in the United States,” said Vidor Police Captain Edward Martin.

Capt. Martin, who is also a board member of the Combined Law Enforcement Associations of Texas, said he has been tracking this issue for years.

“These people have direct access to the Texas DMV electronic licensing system. It’s the same tag. It’s just issued illegally,” Capt. Martin said.

Captain Martin said there was no verification process in place.

“I can come in and put the surname Smith first name John from Timbuktu, USA. They will take it. They don’t examine you. They don’t want to know if you’re a living human being,” he said.

HPD Sgt. Tracy Hicks of the Houston Auto Crimes Task Force said about 40% of stolen cars they impound arrive with fake tags.

“It’s a $100,000 truck, brand new. We usually take them here because it becomes evidence. That’s what the scammer was driving,” he said. “If his story is, ‘Oh well, I bought it.’ Oh really? If you bought it, why do you have a useless paper tag?”

Hicks went on to say that many criminals will trade their real license plates for papers while they are in the process of committing a crime.

“A lot of criminals that they put on a paper tag go out, commit their crime, take it off and then go back to the real tags,” he said.

HPD Sgt. Thomas Griffin demonstrated how it works.

“This is a fake temporary car tag, and this specific dealership was selling it on a lot that really didn’t exist, right?” KHOU 11 News asked.

“That’s correct. It was found on a vehicle with the wrong VIN. There’s also a wrong Mylar sticker on the inside of the door,” Sgt. Griffin said. “So it was a stolen vehicle, but it was driven with a fake paper dealer tag issued by Kasniels Auto Sale LLC.”

RELATED: Harris County Toll Road Authority Cracks Down on Drivers With Fake Paper License Plates

KHOU 11 News went to find Kasniels Auto Sales on Lockwood Drive and found no trace of the business. We’re not the only ones who had trouble finding them.

According to the Texas DMV, Kasniels’ license was revoked on November 8, 2021, “for misuse of temporary labels and for failing to meet the requirements of an established and permanent place of business.”

The Texas DMV said Kasniels Auto Sales “issued over 7,800 temporary buyer tags in less than a week, from 8/26/2021 to or about 8/30/2021.”

sergeant. Hicks said that was impossible.

“We’ve seen a lot of car dealerships that don’t even have a batch of cars selling thousands of them,” he said.

CTC Financial, the sister company of Coast to Coast Motors in Houston, has filed a lawsuit against Kasniels, claiming it sold a fraudulent tag used by a driver to avoid a car loan.

KHOU 11 News spoke to coast-to-coast marketing manager April Hanson, who confirmed they couldn’t find the company.

“No, we haven’t been able to find the Kasniels,” she said.

KHOU 11 News also tried to track down Kasniels to get their perspective. Besides this empty lot we visited, we made phone calls and searched, but found no sign of anyone connected to their DMV license.

So what could or should be done to crack down on fraudulent license plates?

Texas cracks down on fake paper plates

sergeant. Joe Escribano of the Travis 3 County Constable’s office obtained a web DMV dealer tag report from Texas and crunched the numbers. He said the issue cost local and state governments at least $220 million in lost revenue from 2018 to 2021.

That number, according to Sgt. Escribano’s breakdown of the report is growing by about $2 million a week. Police are calling it a multi-million dollar criminal enterprise hidden in plain sight.

There has been progress in enforcement. A crackdown on tolls in January led to more than 1,300 citations.

Law enforcement officers go through all this training to spot temporary illegal tags on the streets, but some told us this problem could be stopped dead if dealers were properly vetted.

The Texas DMV has taken action against dealers it says are abusing the system.

Records obtained by KHOU 11 News show the agency revoked the license to print labels from 34 Texas dealerships from the start of 2021 through the last week of February. Many of them were in Houston.

However, Captain Martin insists DMV can do more.

“We could almost end this overnight because anyone who wants to do it the right way will go and pay that $25 per person,” he said.

He said dealers can be verified by photo, fingerprints and even state-issued ID.

“All the bad guys are leaving. They’re not going to come down and identify themselves,” he said.

According to HPD’s Auto Theft Task Force, the DMV imposed new limits on the number of tags a single dealer can print each month and made it easier to quickly close dealerships for fraud.

The Texas DMV board voted to consider using fingerprints for the dealer licensing process, but that was before their executive director resigned in early February.

RELATED: Texas DMV chief resigns under pressure to stop widespread sale of fake paper license plates

Nevada DMV official issues Texas paper plate warning

And the problem of fraudulent paper plates isn’t just causing heartache here, it’s creeping into other states that are counting on the Texas DMV board to fix it, once and for all.

Joseph Decker, Chief of the Nevada DMV’s Compliance Enforcement Division, explains why they are issuing a serious warning to Nevada drivers about Texas paper tags.

WATCH: Nevada DMV official warns drivers about Texas paper tags

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