Despite increased safety measures and increasingly stringent laws, consumers still fall victim to odometer fraud daily. Due to a lack of consumer awareness, consumers think that the oldest car fraud in the book couldn’t possibly happen to them in today’s era with safer vehicles and digital odometers. That was the general idea when digital odometers were created to replace their mechanical forbearers, but the sad fact is that with odometer correction software readily available via the Internet, odometer fraud is easier than ever, and harder to detect.
What is Odometer Fraud?
Odometer fraud happens when someone resets or alters a vehicle’s odometer and/or documentation in any way with the intent to show less than the actual mileage. The odometer is the number one way to know how much use the car has seen and also helps indicate the vehicles condition and impending necessary repairs. As any mechanic will tell you there are certain things that need to be checked, changed or repaired every 20,000; 60,000 or 120,000 miles. If a vehicle has been “clocked” or “spun” the vehicle, may not receive the servicing it needs for its true mileage, putting the vehicles owner at risk.
Odometer tampering is a serious crime and consumer fraud issue that is on the rise. In 2002, the National Highway Traffic Safety Administration (NHTSA), a government office that is part of the U.S. Department of Transportation, determined that more than 450,000 vehicles are sold each year with false odometer readings, draining American car buyers out of more than $1 billion annually.
The U.S. group Consumers for Auto Reliability and Safety estimate that dealers make 10 cents profit for each mile the odometer is rolled back. Ten cents a mile doesn’t sound like much, but it adds up quickly. For example, a vehicle that is rolled back 35,000 miles, at 10 cents a mile, equals $3,500 profit or more.
Odometer fraud is most common with newer models that have accumulated a high mileage in a short amount of time, these are often leased, company and rental vehicles. Surprisingly, odometer fraud is committed most often by wholesalers who sell to dealers. The unaware dealer then sells the vehicle to an unsuspecting buyer.
One Victim’s Story
“The car was about 5 years old, looked to be in great condition, and I paid $6,000 for it,” says Sarah Evenson. “I’d heard about odometer rollbacks, but I was very surprised when I found out it had been done to my car.” Sarah, like many other car buyers, thought she’d gotten a great deal on the used car she bought through a private seller, but it wasn’t long before it was giving her serious headaches.
“It was burning oil. So I took it in to a dealer, and rather than deal with the repairs, I figured I’d just trade it in,” she explains. The dealer Sarah visited was a CARFAX subscriber, who ran a report on the car using its vehicle identification number (VIN). Unfortunately, he had bad news for her; someone had pulled off a classic used car scam: odometer fraud.
“The CARFAX report showed the car’s odometer had been rolled back about 40,000 miles,” Sarah said. Since the dealer could only offer her $900 for the car, Sarah decided to go ahead and spend $3,000 to replace the engine.
“In Sarah’s case, when it turned out her odometer had been rolled back, the value of her car instantly dropped by nearly $5,000,” explained Larry Gamache, director of communications for CARFAX. “On top of that, she had to spend an additional $3,000 on repairs.”
Protect yourself from odometer fraud
The best way to avoid being the next victim of odometer fraud is to look for the warning signs when shopping for a used car. Beware, Jack Gillis author of The Car Book, estimates that 1 out of 10 used cars on the market has had their odometer meddled with. However, using the following tips will keep you from falling for one of the oldest tricks in the book:
• Ask if the seller has a CARFAX Vehicle History Report, if they don’t, spend the money to get one – you won’t regret it. Use the report to check for odometer discrepancies in the vehicle’s history.
• Don’t be shy, ask to see the title and compare the mileage with the odometer.
• Compare the mileage on the odometer with the mileage on the vehicle’s maintenance or inspection records. Also, look for oil change and maintenance stickers, usually found on windows, door frames, glove box or under the hood, these always include the mileage.
• Check that the numbers on the odometer gauge are correctly aligned. If they’re crooked, contain gaps or wobble when you hit the dash with your hand, walk away from the deal and report it.
• Be wary of older vehicles that have a shockingly low mileage.
• Examine the tires. Tires last for about 20,000 miles, so if the odometer shows 20,000 miles or less, it should still have the original tires. If they don’t, be skeptical and ask questions.
• Look at the wear and tear on the vehicle. Pay careful attention to the gas, brake, clutch pedal and rugs; the amount of wear should correspond with the mileage.
• Have a trusted mechanic inspect the vehicle. He will be able to tell if the wear and tear is consistent with the mileage.
It is possible that an odometer may be rolled back and not identified in a CARFAX, this can happen in several ways. The most common being the odometer is rolled back, but not beyond the last recorded mileage, or the title itself is altered, and the mileage is rolled back.
If you have been a victim of odometer fraud report it to the NHTSA at 202-366-4761 or email@example.com, you are also encouraged to contact a lawyer. If you come across a vehicle with an altered odometer report it and prevent others from falling victim.