Odometer fraud is a growing problem in the United States. The National Highway Traffic Safety Administration (NHTSA) estimates more than 450,000 vehicles sold every year contain odometers showing false readings. Fraudsters manipulate these odometers either physically or digitally to show fewer miles than the vehicle has, thereby deceiving consumers and artificially inflating the vehicle’s price. This not only costs consumers thousands of dollars in unexpected repairs (the NHTSA estimates Americans lose $1 billion each year to odometer fraud) and denied resale value but can also put them at potential safety risk by obscuring the wear and tear on important components.
Consumers who suspect their vehicle’s odometer reading might be incorrect should confirm this before seeking legal help, but legal help absolutely exists to get them the compensation they deserve. Odometer fraud is a federal crime in the United States, codified into law since 1972.
The first step you should take if you suspect odometer fraud is checking for common, telltale signs. Ideally one would do this during the car shopping process, but better late than never. Older vehicles or some specialty vehicles still use physical odometers. These odometers use a system of interlocking gears to measure mileage traveled. These gears turned physical numbers which tell owners how many miles the vehicle had. Physical dometers could be altered by simply removing them and rolling the miles back by hand or using easily available tools, including power drills and screwdrivers.
This leaves behind visible evidence for the eagle-eyed consumer. Misaligned numbers on the odometer or irregular spacing between the numbers gives away an altered odometer. Other more general signs are mismatches between the odometer reading and the car history report. The single most telling sign of odometer tampering is if the car shows more visible wear than a vehicle with similar mileage and a confirmed accurate odometer. Often overlooked signs of wear include brake pedals showing more metal than rubber, replaced spark plugs, brake pads or calipers, and depending on the total mileage, whether the vehicle still has its original tires.
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Most modern vehicles now use digital odometers. These devices use sensors to measure wheel rotations and record miles driven. Digital odometers are easier to falsify, as they can be accessed using digital devices available online. One possible method still involves removing the odometer from the vehicle, except this time the device is connected to a computer. The user then edits the mileage and re-flashes the chip controlling it. Other methods include removing and replacing the odometer chip with one from a compatible vehicle with lower mileage, resoldering the new chip onto the circuit board. Other methods involve connecting devices to the vehicle’s on-board diagnostic ports to alter the odometer reading, eliminating the need to remove the odometer entirely.
The next step you should take is checking for maintenance stickers and comparing that to the documentation you received when purchasing the vehicle. Your dealership must provide documents with the official mileage reading at the point of sale. You can compare this with maintenance stickers and maintenance records to see if the numbers match up. Several websites allow, for a nominal fee, consumers to check their vehicle’s VIN against online databases. These sites will not only show you the vehicle’s reported mileage, but also if the vehicle was involved in a reported crash or flood. Either can cause the owner further headaches in the future.
Dealers must present mileage documents per the federal Truth in Mileage Act (TIMA). These are part of the many forms consumers sign when buying a vehicle. The federal law requires such disclosures for all passenger vehicles, pickup trucks, motor homes, motorcycles, and trucks with a Gross Vehicle Weight Rating less than 16,000 pounds that are less than ten years old.
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The law allows exceptions for certain vehicles including vehicles 20 years or older, vehicles with Gross Vehicle Weight Ratings over 16,000 pounds, snowmobiles, all-terrain vehicles, vehicles that are not self-propelled, or in the case of a title transfer in which at least one of the registered owners is staying the same, except when the title submitted is from out of state.
The law changed on Jan. 1, 2011, making vehicles 20 years old or older exempt from odometer disclosure statement requirements. For example, a 2011 model year vehicle won’t be exempt from odometer disclosure until 2031.
Rolling back an odometer, whether it’s an electronic odometer or older analog odometer, is a federal crime. Odometer fraud convictions can include fines up to $10,000 for each violation, with each altered odometer counting as a separate instance. A conviction also opens the perpetrator to civil lawsuits from anyone to whom they sold a tampered vehicle, with the law allowing damages three times the number of actual damages or $10,000, whichever is greater. Those found guilty of odometer fraud can also be sentenced to three years in federal prison.
Once a consumer decides their odometer is wrong, their next step should be taking the vehicle to a trusted mechanic. They have the tools needed to take a closer look into the vehicle and determine its wear and tear, and can help you determine whether or not you’ve been scammed.
Odometer fraud is a serious crime, and one the U.S. justice system takes seriously. One notable odometer fraud case occurred in April 2021 when two Texas men pleaded guilty to conspiracy to make false odometer statements and commit securities fraud.
The U.S. Department of Justice issued a statement saying the two men, 61-year-old Nepthali Luna and 36-year-old Devon Luna of San Antonio admitted to selling high mileage used vehicles with incorrect mileage readings on the vehicles’ odometers titles and odometer disclosure statements. Court filings show the younger Luna purchased high-mileage vehicles and then caused those vehicles to show false, lower mileage before selling them for inflated prices.
The Lunas admitted, according to the DOJ statement, to selling 225 vehicles with “rolled back” odometers resulting in consumer losses surpassing $550,000. Nepthali Luna faces a maximum sentence of five years in prison, while his son Devon faces 10 years for securities fraud and three years for making false odometer statements.
If you think you bought a vehicle with a falsified odometer and your mechanic agrees with you, you should immediately notify your insurance company. If you are financing the vehicle, you should notify the bank as well. You should also get in touch with a qualified car fraud attorney to pursue a odometer fraud claim.
Every U.S. state has anti-fraud laws that protect consumers when their dealership rips them off. Texas consumers, for example, are protected by the Texas Deceptive Trade Practices Act (DTPA). The act, signed into law in 1973, allows consumers to fight back against false or misleading business practices and get compensation for damages. These malicious practices can include odometer tampering or odometer fraud.
The auto fraud attorneys of Allen Stewart P.C. are ready to help you with your odometer fraud claim. They have the experience and expertise needed to see your claim through and get you the compensation you deserve. Don’t wait; contact Allen Stewart P.C. today.