Floyd flooded homes in eastern North Carolina last September,
it also soaked more than 75,000 cars in water awash with motor
oil, fertilizer and other contaminants.
Even though the cars were written off
as total losses by their insurers, some of them will be repaired
and sold to unsuspecting customers all over the nation.
They aren't the only losers you could
wind up driving: Vehicles totaled in wrecks or cars that have
been officially declared lemons may also wind up on a used
But you can minimize the risk of becoming
a victim of this practice known as title washing or
the line to cleanliness
The key factor is the state line.
The Floyd cars, the rebuilt wrecks and
the lemons will go on sale in another state. As part of their
movement they will get a clean title, one which shows no signs
of their unfortunate history.
Do your homework
you step onto the car lot
Here are some steps you can take before
plunking down cash for that used car:
If you can, get the car's vehicle
identification number. There are a number of companies
that offer access to a national vehicle identification
number database for a fee. Every vehicle manufactured
since 1981 has a 17-character number (VIN), which
identifies the year, make, model, body style, engine
size, restraint system and place of manufacture
of any given vehicle. We did a search and found
a number of sites. Be careful to check the legitimacy
of these companies with the Better Business Bureau
or another consumer protection agency.
- On the Kelley
Blue Book site, you can do a free search to
find out which vehicle identification numbers have
been cited for things such as flood damage or odometer
fraud. A more complete history report of these cars
costs $19.50. Carfax
has a similar service and car shoppers can order
car history reports for $19.95.
- At the car lot, ask to see a copy of the dealer's
warranty before you buy.
- Ask for the car's maintenance record from the
owner, dealer or repair shop.
- Use your state's lemon laws to your advantage.
States have lemon
laws and consumer legislation that can help some victims.
But even lemon laws have their limits when it comes to these
There is no federal law to stop the practice.
That could change with bills brought before Congress by two
powerful senators, Sen.
Dianne Feinstein, D-Calif., and Sen.
Majority Leader Trent Lott, R-Miss.
The cleaned-up Floyd cars floating onto the market are
just a surge in a steady flow of junk onto used car lots.
The number of damaged cars being resold
is staggering: Of the approximately 2.5 million vehicles involved
in accidents last year and so badly damaged they were declared
a total loss, roughly 40 percent were rebuilt and put back
on the road, according to the National
Association of Independent Insurers.
"It's a dirty practice and with everything
else you need to worry about when buying a used car, this
lack of disclosure only ends up burning the consumer,"
says Sally Greenberg, senior product safety counsel for Consumers
Union, a watchdog group based in Washington and publisher
of Consumer Reports.
Dirty lemons also roll over state lines
and come up clean.
"It is possible that car dealers
can ship lemon cars across state line after they've been reported
in one state," says Amy Mall, deputy state director for
Feinstein's Los Angeles office. "That's the loophole.
"There's really no federal standard
on the books that can stop that dealer from applying for a
new title in another state. (The consumer) may have no idea
he's buying a lemon even if the title is clean and clear."
States such as Florida and California have seen widespread
title washing even though strict lemon laws are in place to
protect consumers, says Janet L. Smith, assistant attorney
general for Florida's Lemon Law Arbitration Program. In Florida
alone, an investigation of 20 manufacturers of rebuilt cars
found that 88 percent of these vehicles were being resold
to dealers and in turn to customers without the required lemon
Sen. Feinstein is sponsoring the Salvaged
and Damaged Motor Vehicle Information Disclosure bill, which
would provide nationwide written disclosure, with every sale,
of previous salvage and major damage. Cars, motor homes, pickup
trucks and motorcycles would be protected.
"We have seen case after case in
which serious physical and financial losses were inflicted
on innocent victims who unknowingly purchased a vehicle that
had sustained major damage," Mall says.
Feinstein's own legislative director was
a victim of title laundering in 1996 when he purchased a used
Saturn in Virginia, only to discover that the car had been
in a flood in Pennsylvania, where it was originally purchased.
"He probably never would have known the car's history
if his mechanic had not run the car's vehicle identification
number for him," Mall says.
Lott is sponsoring similar legislation
but some consumer groups argue his bill is flawed because
it allows states to opt out of having to disclose a vehicle's
"It really defeats the purpose of
having a federal law in place if states can chose not to mandate
it," Greenberg says. "You would think all 50 states
would want to protect car shoppers."
You can urge your member
of Congress to back these efforts and you can follow
the progress of the bills.
-- Posted: Nov. 19, 1999