Odometer Fraud Is Common and Illegal

Believe it or not odometer fraud is as common as ever. Modern cars with digital odometers are just as likely to be rolled back as a mechanical odometer.

 

Modern vehicles have multiple computer systems for different functions. Windows, door locks, radio, even sunroofs have their own systems. So its no surprise that the odometer has its own system too. Mechanics can connect a computer to your car to get information from these systems and to diagnose problems. Dealers and other people can use these same devices to reset the mileage of a car.

 

Look for “odometer correction” videos on YouTube. Many have links to eBay or AliExpress where you or I can order one of these devices. Other videos show how to replace the chip behind the dashboard. This is more like rolling back an old-school mechanical odometer and leaves all kinds of marks on the car.

 

Even though there are lots of videos on YouTube about “correcting” a digital odometer. Rolling back an odometer, however it is done, is illegal. Here are the details:

 

The Federal Odometer Act

The Federal Odometer Act, was passed by Congress in 1972 to prevent odometer tampering, and to provide other protections for car buyers. It has five major provisions relating to odometers:

  1. It prohibits odometer tampering, advertising or selling odometer fraud devices, and operating a vehicle knowing the odometer is not functioning;
  2. It provides steps to follow when a motor vehicle repair makes a change in the odometer reading;
  3. The Act requires when a vehicle is transferred, that the odometer reading and whether the odometer reading is accurate, has exceeded its mechanical limits (that is, for cars with five digit odometers, has exceeded 99,999 miles), must be disclosed. And it prohibits dealers as transferees from accepting incomplete disclosures;
  4. It prohibits false statements in conjunction with the disclosures; and
  5. It prohibits parties from conspiring to violate any of the Act’s provisions.

 

The Act gives you the right to sue anyone who has violated the Act with the intent to defraud, and if you are successful says you can get three times their actual damages or $10,000, whichever is greater plus reasonable attorney fees and costs. You have to file suit within two years from the date you discover the violation.

 

Two Paths of Liability

A dealer can be liable for 1) the odometer being rolled back and 2) disclosing an inaccurate mileage on the “odometer disclosure” form that is part of a car transaction. Even if the dealer did not perform the roll back they can be liable for making a disclosure if it can be shown they had the intent to defraud.

 

Intent to Defraud

The odometer fraud act has multiple intent requirements. Generally you must show an intent to defraud. But as one court said “the odometer is designed to give accurate information about how far an automobile has traveled, and no reason for turning it back other than to deceive potential buyers can be imagined.”

Intent to defraud can be easily shown when the dealer’s disclosure shows the odometer reading as accurate. Dealers are tasked with knowing how the law operates and must compare the prior disclosure statement with the one they are making.

Courts say that a dealer’s carelessness with odometer records is the same as intent to defraud. The same intent can be inferred when the previous disclosure indicates that the odometer is inaccurate. Additionally, intent to defraud can be inferred when the mileage disclosed to a consumer is lower than the mileage disclosed to the dealer when the dealer purchased the car.

 

How to Know if your Odometer was Tampered With

There are  few clues that may make you think your odometer has been tampered with. First, the car is having problems that only a higher mileage car would have. The serpentine belt is a perfect example. Modern serpentine belts last 90,000 miles or more. If you bought a car with an odometer that says 20,000 and the serpentine belt went out, then it could be that your odometer was tampered with.

If you suspect odometer tampering, then look your car up on a database. Carfax is a popular choice and a good one too. It often contains data from a car’s service checks. If the milage from one of those is greater than your odometer, then your odometer was probably rolled back.

If you have a car whose odometer was rolled back then give us a call today.

About The Author

Bill Clanton

Over the years my office has helped thousands of consumers who were cheated, ripped-off, and mistreated by debt collectors, credit reporting agencies, banks, credit unions, and car dealers. If you have a problem with a business being dishonest with you give me a call. I’d love to set them straight.