A Sandy Lake couple pleaded guilty this week in Mercer County Common Pleas Court to theft charges for their role in an auto title and registration scam that reaches back at least two years.

John L. and Garnet O'Neil, of 1079 Creek Road, both pleaded guilty Tuesday to single counts of theft by failure to make the required disposition of funds, a first-degree misdemeanor. They face up to 5 years in prison and are to be sentenced late next month by Judge Thomas R. Dobson.

The couple was charged by state police on a combined 550 counts, most of them alleged bookkeeping violations, according to court paperwork. The O'Neils ran Sandy Lake Auto Sales, which is now out of business. John L., 50, was the owner and Garnet, 45, was the notary agent.

During late 2000, police received 59 complaints from customers who had paid the O'Neils for titles or registrations from PennDOT but had not received them, the court paperwork says. Many customers also paid for temporary license plates, but PennDOT had no record of them being issued, the paperwork says.

The prosecution of the staggering list of charges, which range from summary offenses to third-degree felonies, was "gutted" because state police improperly gathered a mountain of evidence, according to Assistant District Attorney Keith Bell, who handled the case.

"There was no indication at all of bad faith on their (state police troopers) part. They were doing what they thought was correct," Bell said.

Pennsylvania has no "good faith exception," which gives federal investigators more leeway in unearthing information.

"We lost our evidence because the court ruled -- and, we believe, properly -- that their search was overly broad," Bell added.

The evidence -- all of the O'Neils' business forms, receipts, returned checks and check ledgers as well as bank information for business and personal checking accounts in their names from the past two years -- were suppressed by defense attorneys Jack Kline and Paul Powers and ruled inadmissable in court.

Dobson said the investigation became a "fishing expedition" and ended up being "too broad" in scope.

"They (police) had enough evidence to show seven potential crimes had occurred. They should have been asking for all information related to those specific crimes, but they requested a warrant to look at everything (paperwork) the O'Neils had for the past two years," Dobson said.

According to the affadavit of probable cause filed in the case:

Police said John L. O'Neil refused to let troopers search the dealership in November 2000 and said, "Why should I make it easy for you to arrest me?"

"After the statement by O'Neil and after careful consideration of the preservation of evidence, the trooper advised O'Neil that a search warrant would be obtained and that he would return in the morning to execute the warrant." O'Neil then allegedly throw a stack of paperwork at the trooper in disgust. Troopers returned the next day and seized all paperwork at the dealership from the past two years.

In addition to pleading guilty to the theft charge, the O'Neils also said they would pay between $4,000 and $4,900 to cover victims' losses, generally between $75 and $200, Bell said.

In all, the O'Neils both faced 89 counts of reissuing temporary registration forms, 59 counts of theft by failure to make the required disposition of funds, 59 counts of applying for a certificate of title, 59 counts of grounds for disciplinary proceedings, five counts of odometer mileage statement violations, two counts of conspiracy to commit theft by failure to make the required disposition of funds and one count each of odometer disclosure requirements and investigation by police officers.

The O'Neils could not be reached for this story.

You can e-mail Herald Staff Writer Tom Fontaine at: tfontaine@sharon-herald.com