Digital era boosts odometer rollback crime: Internet Scambusters #556
Odometer rollback scams are on the rise, boosted by software and Internet guides that make them easy to do.
The crime costs more than 450,000 Americans a total of over $1 billion every year.
In this week's issue we explain what to do if you discover or suspect you're a rollback victim -- or, better yet, how to avoid being scammed in the first place.
7 Ways to Spot an Odometer Rollback Scam
Odometer rollback has to be one of the oldest tricks in the book. As long as people have been buying cars, sellers have been turning back the mileage to make their autos look like a better deal.
The remarkable thing is that, despite relentless campaigns and special investigations, unscrupulous sellers are still doing it.
Various estimates suggest:
* More than 450,000 cars are sold every year with false mileage readings.
* 1 in every 10 cars on the road today have been "clocked."
* The fraud costs American auto buyers $1 billion a year (in terms of the difference between what they paid for the cars and their true worth).
Actually, those are old figures from the latest available official statistics. But according to the Department of Transport's Office for Odometer Fraud Investigations (OFI), the number has escalated since they were compiled in 2002.
One reason is that the digital age has made it easier than ever to alter odometer readings. You can actually buy software online that claims to be able to do this.
And there are scores of websites with all kinds of instructions on how to alter mileage readings, both manually and digitally.
But the crime can also be as simple as replacing a high-mileage odometer with a low-number device bought from an auto scrapyard.
In a recent raid, police recovered a stack of these used odometers in an alleged fraudster's home.
OFI's main job is to track down and prosecute the crooks but it also operates a Customer Outreach Program (COP) providing information on odometer laws, disclosure requirements, and guidance on what to do if you suspect odometer tampering.
However, it doesn't play any role in civil actions that might help victims recoup losses resulting from odometer fraud. You need an attorney for that.
If You're a Victim
If you're a victim, current civil law provides for compensation of $1,500 or treble damages, whichever is greater.
Damages are based on the reduced resale value of the auto, increased insurance costs and taxes, repair costs and the time spent sorting the whole mess out.
If you think you're a victim, there are three key actions you should take.
First, try to establish if your hunch is correct. Use some of the tips below in our prevention section, notably getting a CARFAX report. Also, consider getting a reputable, expert auto mechanic to check it out.
Second, if you know or are pretty sure you've been defrauded, report it to state and federal investigation agencies.
The National Odometer and Title Fraud Enforcement Association (NOTFEA) maintains a state-by-state register of contacts.
And third, consult an attorney -- though, depending on the nature of the deception, you may not be able to take civil action until criminal proceedings have been completed.
How to Spot a Clocked Car
So, what can you do to avoid buying a clocked car? Here are 7 key tips, from the National Highway Traffic Safety Administration (NHTSA):
1. Ask the seller to show you the vehicle's title document and compare that with the mileage reading on the odometer. Be wary if the number is difficult to read or seems to have been altered.
2. Ask to see maintenance and inspection records. Again, these should show all prior odometer readings.
3. Look for records on oil change stickers on windows and doorframes or in storage compartments.
4. If the odometer is of the older, mechanical type (rare these days), check that the numbers are properly aligned in the viewing window. If they're not, that could be a red flag. Tap on the dashboard glass by the odometer. If the numbers wiggle, that could also be a telltale sign of tampering.
5. Check the tires for wear. If the supposed mileage is less than 20,000, the vehicle should still have its original tires.
6. Also review the general wear and tear on the auto. Are the upholstery, trim, pedal covers, carpets etc., how you'd expect them to be for a car with this odometer reading?
7. Get a CARFAX Vehicle History Report.
We highlighted the value of these reports in a couple of earlier issues:
Scammers Dump Flooded Cars on Unsuspecting Buyers
A CARFAX report will reveal any discrepancies in the car's history.
These reports have to be paid for, so ask the seller to provide one. Otherwise, use the vehicle's identification number (VIN) and order one yourself at carfax.com.
Be sure to check out NHTSA's Odometer Fraud page.
Finally, always remember the Scambusters adage that if a deal looks too good to be true, it probably is.
In the case of autos, any bargain buy warrants closer scrutiny and a healthy dose of skepticism, starting with the odometer.
That way you won't be among the half million or so buyers who get caught out by odometer rollback this year.
Time to close today, but we'll be back next week with another issue. See you then!