Getting Off - S4-E16
Continuity mistake: When Jamal is been helped out of Ed Burnell's wrecked BMW 7 Series, the wrecked car is a late 80s-early 90s E32 model. However when Burnell was driving it at the beginning of the episode, it was a newer late 90s-early 00s E38 model. Again, the production crew couldn't afford to wreck a brand new car so an older one was substituted.
Answer: He doesn't have the authority to arrest him - when anyone is arrested in the show, a police officer does it. Also he tells Ty that he is going to be submitting his case findings to Ty's insurance company, who would no doubt contact the IRS, who then would have him arrested for fraud etc.