Businesses Target Illegal Immigrants Advocates for undocumented workers in California have failed to win legislative approval for state-issued auto licenses for illegal immigrants. But that doesn't mean the undocumented can't buy a car, register and insure it -- or even get a mortgage and buy a house. The loophole that allows unlicensed people to buy a car is part of an emerging market trend that views illegal workers as a potentially lucrative market.

Businesses Target Illegal Immigrants

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From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.


And I'm Melissa Block.

For years California has rejected the idea of issuing drivers' licenses to illegal immigrants. But there's no law in the state to stop those same immigrants from buying, registering and even insuring a car. In fact, selling automobiles and lots of other expensive items to people in the US illegally has become big business. And as NPR's Richard Gonzales reports, California is just one state where merchants are cashing in.

(Soundbite of traffic)


Wilson Way is auto row in Stockton, California, about 80 miles east of San Francisco. Colorful banners feature enticements in Spanish, such as `Your work is your credit,' and `No license? No problem.' On a slow, scorching hot day, used car salesman James Alvarado sits inside his air-conditioned office trailer. He says many of his customers buy cars without showing him a valid California driver's license, and he says that usually means they can't get one.

Mr. JAMES ALVARADO (Used Car Salesman): I know they're illegal. I don't ask them; I really don't care. They pay taxes on their car when they buy it. They pay $8 for every hundred.

GONZALES: No licencia, no problema, huh?

Mr. ALVARADO: Yeah, no licencia, no problema. Money's green. That's what everybody wants, you know.

GONZALES: California has no laws requiring car buyers to have a driver's license, says Bill Branch, a spokesman for the state Department of Motor Vehicles.

Mr. BILL BRANCH (Spokesman, California Department of Motor Vehicles): Under California law, you can purchase and register a car without a driver's license. But you'll be breaking the law if you attempt to drive that car without a license at any time.

GONZALES: And that includes just driving it off the car lot.

Mr. BRANCH: And you're not going to be able to renew the registration without proof of insurance, which requires the driver's license.

GONZALES: Branch says most insurance companies won't sell policies to people without a valid California driver's license, but there are a handful of companies that will. Insurance broker Leo Garcia(ph) says he sells about 80 policies per month; 90 percent of them are to illegal immigrants.

Mr. LEO GARCIA (Insurance Broker): For the most part, it's not a big risk because, if you think about it, the people that drive without a license are more careful. They don't want to get pulled over; they don't want any problems 'cause if they do, they're going to lose their car or truck. And if it's a truck, usually they work construction, and, you know, they're going to work and you're messing with their livelihood, you know. So most of them when they come in here and buy auto insurance, it's very rare that I even receive a claim from them.

GONZALES: Garcia says those insurance policies aren't cheap either. The premiums can run 20 to 30 percent higher than average, and that's just a fact of life, says Antonio Sanchez(ph), a construction worker who has been in the United States illegally for 15 years.

Mr. ANTONIO SANCHEZ (Construction Worker): I'm driving without a license because they don't give you. So I have to drive it; I have to go to work. So I need it. It's really necessary to drive in this country.

GONZALES: Leo Garcia, the insurance broker, says all he asks for is a Mexican license or a matricula consular. That's an ID card issued by the local Mexican Consulate. He says it all adds up to a very lucrative business.

Mr. GARCIA: I don't even put a sign out there because I don't want to get overwhelmed. Just I get enough business from the dealerships themselves. Yeah, it's a gold mine.

GONZALES: Garcia's gold mine is only a part of a burgeoning business of selling to illegal immigrants, everything from cars and insurance to homes and mortgages. Economist Belinda Reyes of UC Merced says the trend suggests a contradiction between the market and immigration laws to keep illegal immigrants out of the country.

Ms. BELINDA REYES (UC Merced): And in the economic reality, they are being hired and they're working and they're buying. And the business community responds to create opportunities for a new market and finding ways to adjust, the same as banks and the same as many other sectors, including car salesmen.

GONZALES: But the trend alarms Ira Mehlman, a spokesman for FAIR, a group which advocates immigration restrictions. He says it's the government's job to impose checks and balances on business.

Mr. IRA MEHLMAN (Spokesman, FAIR): Obviously, it's the objective of business to maximize their profits, but we do it all the time. We limit what businesses and industry can do when they start to take steps and institute policies that really don't serve the public interest.

GONZALES: Back in Stockton, insurance broker Leo Garcia says he's not breaking any laws, and he sees nothing wrong with selling auto insurance to illegal immigrants or anyone else who can pay for it.

Mr. GARCIA: That's probably why.

(Soundbite of beeping noise)

Mr. GARCIA: There it goes; money calling (laughs).

(On phone) Hello. This is Leo.

GONZALES: Richard Gonzales, NPR News.

Mr. GARCIA: (On phone) OK. What's the phone number?

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