Dude, where's my catalytic converter? Probably back in the supply chain

Paul Roberts
The Seattle Times (TNS)

SEATTLE — Tow truck driver Edgar Plata spent most of a recent Monday as he often does these days, picking up the pieces after a spree of catalytic converter thefts.

By the time he pulled up to my North Seattle home to tow my newly converter-less Honda, Plata, who works for Viking Towing, had already hauled off two vehicles with similarly violated exhaust systems.

"It's out of control," says Plata, 44, of the plague of thefts that now afflicts every community in the Seattle area — a plague that, in his view, can only get worse, given its very attractive economics.

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A stolen catalytic converter can fetch hundreds of dollars on the local black market, thanks to the platinum and other rare metals found inside. In just a few days, an experienced thief with a reciprocating saw and a set of cheap car jacks can "make thousands," says Plata, whose own converter was converted into quick cash by a thief a few years ago. "It's a big business," he says. "Supply and demand."

Just so. To lose your catalytic converter these days is to be a temporary supplier to a large, well-financed underground enterprise.

So far this year, some 2,500 catalytic converters have been reported stolen in King, Pierce and Snohomish counties, up from a total of 41 in 2019, when thieves started getting serious about catalytic converters, or "cats," and on pace to surpass 2021.

Such growth isn't surprising, given current prices for the metals used in the catalytic process: Platinum, for example, sells for $928 an ounce, palladium $1,884 and rhodium $14,000. At the street level, that means a stolen cat can fetch $1,000 or more, depending on the model. Few other stealable goods promise such profit for so little labor or legal risk.

Thieves "have it down to a science," says Gary Ernsdorff, a senior King County prosecutor who heads up cat theft investigations. "They go shoplift a sawzall from a big box store and can make $500 in a very, very [short] amount of time with, frankly, pretty low odds of being caught."

Those relatively easy profits have spurred more frequent, more brazen thefts. Where thieves, also known as "cutters" or "boosters," once mainly hit Toyota Priuses, they now case neighborhoods, parking lots and even car dealerships and government fleet yards for everything from Toyota Tundras and Honda Elements to Ford F-250 pickups.

(And, sadly, early 2000s Honda CR-Vs, which, as Plata tells me, have enough ground clearance that thieves "don't have to use a jack — they can just crawl under.")

But those easy profits aren't just fueling more thefts. They've also created a giant "shadow market," as Ernsdorff calls it — a sprawling supply chain that connects quiet neighborhoods like mine to a network of out-of-state, off-the-books processors and smelters that turn that contraband into untraceable, high-value commodities in weeks or even days.

"There's a structure and organization to it that you don't see with really any other stolen property at this scale," says Tim Meyer, King County Sheriff's Office spokesperson.

Local law enforcement officials won't share many details about the Seattle-area end of that shadow market, in part to protect ongoing investigations.

But drawing on recent cases — including a 2021 bust in Kent and spectacular federal sting in California last month — as well as media accounts, off-the-record interviews and online pricing and technical information, I have a pretty good idea what happened to my cat after it was sawed from my exhaust pipe.

Within hours of the early-morning theft, my cat probably had been sold to a local buyer, possibly someone the thief met on Craigslist, Facebook Marketplace, OfferUp or another online forum. (The old-school practice of selling stolen cats to local metal recyclers is harder now after a newly enacted Washington state law.)

The buyer would've quickly identified my cat's model from a reference number on the casing, looked online for the value of the metals inside (around $1,000 for a Honda CR-V) and probably offered the thief around $300. Today's buyers "just whip out their phone, pull up a website, punch in what the cat is and pay the person," Ernsdorff says.

From here, my cat likely took one of two paths.

That buyer might have added my cat to other recent purchases and shipped the lot to a processor who extracts the metals. Before last year's bust in Kent, for example, out-of-state buyers allegedly purchased nearly 800 stolen cats from locals and intended to transport them to an out-of-state processor.

Or the buyer may have flipped my cat up the chain to a middleman, known variously as a "core buyer" or a "consolidator," who coordinates purchases and shipping. In last month's federal sting in California, a core buyer was sending thousands of stolen cats to New Jersey for processing, prosecutors say.

(Processors typically cut open, or "de-can," the cats to extract the powdery metallic contents, which are sent to a refiner and purified back into untraceable metals.)

Some of these shadow operations are almost comically amateurish.

In the Kent bust, buyers parked their van in a parking lot and did a brisk daylight trade with "a line of boosters with catalytic converters in shopping carts and other conveyances," Ernsdorff says.

But some appear to be as tightly coordinated as any industrial supply chain.

DG Auto Parts, the New Jersey firm charged in last month's federal bust, allegedly advertised its services on Facebook. The company also provided buyers with lists of the highest-value cats, based on metals content and real-time metals market prices. The company even put the lists on a subscription-based app, available for iPhone and Android, to help "cutters in identifying the make and model of vehicles to target," federal prosecutors say.

These operations aren't cheap. The fact that thieves like mine know they can get hundreds or even thousands of dollars for every cat they steal only hints at the capital needed to keep this shadow market running.

The buyers in the Kent bust, for example, likely paid at least a quarter-million dollars for their vanload of cats, Ernsdorff says.

And that may have been a relatively small operation. DG Auto paid $36 million over two years to its big California supplier, which used much of the cash to finance ongoing cat purchases from thieves, federal prosecutors allege. Some thieves were also paid in drugs, prosecutors say.

DG Auto Parts, meanwhile, allegedly received a stunning $545.8 million from its refining partner, with much of that for metallic powder extracted from stolen cats, prosecutors say.

"This is a big-money business," Ernsdorff told state lawmakers this year. "Last year, I saw a buyer post a photo on Facebook of his brand-new Lamborghini, bought with catalytic converter proceeds, and it was his second Lamborghini."

To slow the further conversion of cats into sports cars, law enforcement agents typically take one of two approaches. They try to interrupt the supply of stolen cats, by targeting street-level thefts and purchases. Or they try to kill demand for stolen cats, by going after the operators with money.

Both approaches have limits. Even when police take out a deep-pocketed player, the fix is likely only temporary. As long as global metals demand remains strong, any busted cat kingpin will be quickly replaced.

Cutting off local suppliers has also been difficult.

Washington's new law makes it harder to sell a stolen cat. Buyers of used cats now have to demand proof that a seller actually owns the associated vehicle and also must hold full payment for three days.

But the law doesn't make it illegal to possess a used cat, or even dozens of them. That's partly because there's a large legitimate trade in used cats, tens of thousands of which get pulled off decommissioned cars and recycled each year in Washington alone. And anyway, once a cat has been cut from a car, there's no way to prove it was stolen.

In other words, there's still plenty of opportunity for unscrupulous buyers. "There's still guys that have their sites up" offering to "pay top dollars for cats," says Greg London, manager at Seattle's Recycling Depot.

London thinks most local recyclers follow the new law — Recycling Depot, for example, mostly buys documented cats from big auto dealerships and has just started buying from individuals, but only those with necessary paperwork. But London hears of local scrap dealers who still buy cats of dubious origin, and he doesn't expect that to stop as long as there are "big profits to be made."

Federal and state policymakers could make thefts a lot harder, some law enforcement officials say. Requiring all buyers to be licensed, for example, would discourage questionable purchases. Requiring automakers to stamp each cat with the car's unique vehicle identification number would make stolen cats traceable.

But without substantial regulatory changes, some law enforcement officials worry that organized theft will really only end when global metals prices fall.

Until then, a lot of the actual prevention is being left to people like me, using whatever tips we can glean from police or our insurance companies or online forums where victims share their cat trauma.

Since my own, I've been advised to park my car in my garage or, absent a garage, to park in a different place every night. I've been pointed to various cages, cables, panels and other, often quite expensive, cat-shielding technologies, which can't actually stop a theft but may persuade a time-pressed thief to try my neighbor's car instead.

Which means that what I'm mostly doing these days is bracing for the sound of cat theft — the whine of a metal saw in the wee hours, say, or the Harley-like roar of a cut-open exhaust system when I start my car the next morning. All while convincing myself that the odds of being hit twice really must be rather low.

On that point, though, I've gotten little reassurance from the mechanics, adjusters, cops and others I've talked to since the theft.

Ernsdorff, for one, thinks the serious thieves are getting more serious. After three years, they're better equipped, better informed and almost surreally proficient. He says surveillance videos show thieves removing a cat in "as little as 20 seconds."

Plata agrees. He thinks people like me in frequently hit neighborhoods should expect to keep getting hit, even if things seem quiet.

Especially if things seem quiet.

In Plata's experience, thieves will work a productive neighborhood for a few weeks, then will fade away once they've made enough cash to cover their immediate expenses.

But the hiatus is only temporary, Plata warns. "They're laying low. And once the money runs out, they'll come back."