Q: Legality of using multiple LLCs to bypass NC dealer's license requirements?

A: Please refer to North Carolina General Statutes Section 20-286(11)(a)(2) which states that a Motor vehicle dealer or dealer is defined as "[a] person who... [o]n behalf of another and for commission, money, or other thing of value, arranges, offers, attempts to solicit, or attempts to negotiate the sale, purchase, or exchange of an interest in five or more motor vehicles within any 12 consecutive months, regardless of who owns the motor vehicles."

A: What you’re describing raises serious legal and ethical concerns. In North Carolina, individuals or businesses selling more than five motor vehicles per year must have a valid dealer’s license. Trying to sidestep that requirement by using multiple LLCs could be considered a deliberate attempt to evade licensing laws, which can lead to civil penalties or even criminal charges if proven.

Selling cars under a “rent to own” model while withholding title transfer from buyers may also violate consumer protection and DMV regulations. Buyers have a right to title and registration, and denying that while demanding full coverage insurance—especially when the seller carries no insurance—could place undue and unfair risk on the consumer. It may also mislead the buyer into thinking they have ownership rights when they do not.

If there are active complaints against this seller, it would be wise to report the situation to the **North Carolina Division of Motor Vehicles (DMV)** and the **Attorney General’s Consumer Protection Division**. Authorities can investigate whether the business practices are deceptive or in violation of dealer licensing rules. When someone uses loopholes to avoid accountability, it not only hurts consumers—it undermines trust in the system.