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Vehicle Odometer Fraud

Introduction     How NIST Helps

    Violations of the Law

Prevention       One Last Thought





Introduction

Horse pulling a car

Be sure the mileage indicated on your odometer is correct when buying a used car. Photo on virtual loan from Peerless Rockville.


      There is a system in all vehicles that measures the distance the vehicle travels. It is called the odometer and it shows distance in either kilometers or miles on an analog or digital counter. It is a factor in the determination of the price of used cars. A practice among some used-car dealers is to tamper with the odometer by rolling it back, thereby showing a false mileage. The car dealers can then sell the cars at inflated prices to unsuspecting consumers. With an altered odometer, the car may not get the service it needs, such as maintenance and repairs, and the buyer may have major problems later on.
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How NIST Helps

      The National Institute of Standards and Technology works with federal, state, and local governments and agencies such as the Federal Trade Commission to set measurement standards that directly or indirectly affect regulations for vehicle odometers. These regulations require that car manufacturers make the mileage systems more resistant to tampering. They also guide the conduct of the nation's used-car dealers so that it will be much more difficult for the dealers to show false mileage on their cars.

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Violations of the Law

"THRIVING USED-CAR MARKET FUELS ODOMETER FRAUD"

      In the state of Washington, the government has discovered pervasive fraud netting large sums of money from dialing back odometers on used cars. Since 1978, the National Highway Traffic Safety Administration has conducted an increasing number of investigations of odometer fraud. Scam artists usually fix the odometer in minutes, add some new carpeting, do a lot of cleaning, and replace old brake pads with new pads to make used cars appear in better condition. Fraud rings have been found in Texas, California, Virginia, and West Virginia. From 1983-84, Michigan had the most odometer rollbacks with 2,200 fraud cases discovered. By 1995, the number had dropped to 100 (O'Brien, The Detroit News, August 25, 1996).

      Around the nation, federal courts have been cracking down on car dealers who rip off consumers by rolling back odometers and hiding the real condition of the cars. In Philadelphia, a court brought an indictment against three car dealers who were defrauding used-car buyers. The dealers rolled back the odometers, and resold the cars to consumers at inflated prices. The dealers had provided false odometer statements to buyers and had misrepresented the car mileage by as much as 90,000 miles. Similar cases have been brought against many used-car dealers in other states. Federal departments are now utilizing more resources than ever to crack down on a practice that the National Highway Traffic Safety Administration says costs consumers 4 billion dollars annually.


"ODOMETER TAMPERING CASE RESULTS IN FEDERAL PRISON TERMS FOR THREE GEORGIA MEN"

      Kent B. Alexander, United States Attorney for the Northern District of Georgia, Assistant Attorney General Frank W. Hunger of the U.S. Department of Justice, David W. Johnson Jr., Special Agent in Charge, FBI, and Barry Reid, Administrator, Georgia Governor's Office of Consumer Affairs, announced the sentencing of three Georgia used-car dealers. Billy Wilkins, 56, Aaron Taylor, 35, and Remer Brown, 36, pleaded guilty to odometer tampering on February 24, 1997. From April 1993 to June 1994, Wilkins supplied Taylor and Brown with high-mileage used cars in a condition such that they could be passed as having lower mileages. Taylor then rolled back the cars' odometers, and created forged documents to conceal odometer fraud. Together, Brown and Taylor re-sold the cars, misrepresenting the cars' true mileages. It was estimated that the average vehicle rollback was approximately 50,000 miles and that the cost to consumers from the fraud was approximately $4,000 per vehicle. Nationwide odometer fraud costs consumers $4 billion. Each of these three men received sentences of more than one year in jail and fines of more than $2,000.

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Prevention

SUGGESTED METHODS TO GUARD AGAINST ODOMETER TAMPERING

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One Last Thought

      Odometer fraud has recently been on the rise. Millions of used-car buyers have been or will be shortchanged by this practice. It is such a serious matter that the Federal Government is now actively involved in stopping it. With cooperation between the Federal Government and local officials, this problem can finally be put to an end.




Works Cited

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