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Don't get flattened
by a used car with a rolled-back odometer
By Lucy
Lazarony • Bankrate.com
When Rosemary Shahan, president of Consumers for Auto
Reliability and Safety, looks at a used car, she wonders how many
miles have been rolled back on the odometer.
"So many dealers and sellers make profits off
this. It's almost the way they do business," Shahan says.
A dealer pockets an additional 10 cents profit for
each mile rolled back on a car's odometer. Ten cents for each mile
may not sound like much, but it adds up quickly.
Roll back 20,000 miles off an odometer and the price
of the car gets bumped up $2,000. That's an extra two grand for
the dealer. Take 40,000 miles off a car and dealer might pocket
an extra $4,000 or more.
The National
Highway Traffic Safety Administration estimates that odometer
fraud costs Americans more than $1 billion in inflated car prices
a year. That number does not include inflated financing, insurance
and tax costs, additional repair costs, or consumers' anger
and frustration at being cheated.
"It's buyer beware when you're dealing with mileage,"
says Dick Morse, director of the odometer fraud staff at NHTSA.
Technology fails to solve problem
There was lots of talk that odometer fraud would be curbed with
the introduction of digital odometers in the mid-90s. That hasn't
happened.
"As long as there's a gauge on a vehicle, someone
will find a way to roll it back," says David Szwak, an attorney
in Shreveport, La. "The criminal always stays one step ahead."
It takes about 10 minutes to roll back a mechanical
odometer. Rolling back a digital odometer may take a few hours.
There are plenty of people out there willing to do it, as NHSTA
has learned through its investigations.
"One guy, his whole livelihood is rolling back
odometers for dealers," Morse says. "He's figured out
how to do it. It just takes longer."
Hard-to-sell cars likely candidates
The most popular targets for odometer fraud are
leased company cars. Salespeople rack up lots of miles on these
cars before turning them in and dealers get stuck with two-year-old,
high mileage autos that are tough to sell.
Wholesale dealers (dealers who buy and sell cars to
other dealers) snatch up these high mileage cars, roll back the
odometers and sell them to retail dealers. Retail dealers then sell
the tampered-with autos to unsuspecting consumers. Most NHTSA investigations
involve cars coming back off lease.
"You've got a couple million cars coming into
the market with 70,000 to 80,000 miles, and they're rolled back
to 25,000 to 30,000 miles," Morse says.
Any popular, hot-selling vehicle may be a target of
odometer fraud. Sports utility vehicles were targeted in much of
the 90s. Odometer fraud can happen anywhere, but Morse says it seems
to be especially heavy in the Northeast and in states along the
Canadian border.
Kilometers-to-miles conversion confusion
One of the latest scams involves used cars coming
in from Canada. These vehicles have odometers measured in kilometers
that must be replaced with odometers measured in miles. The mileage
conversion from kilometers to miles is often inaccurate.
"If you live in a border state -- watch out,"
Shahan says.
While the majority of odometer tampering happens in
the wholesale end of the auto business, it does occur at some retail
dealerships. Retail dealers that do odometer rollbacks are often
involved in other kinds of fraud.
"If odometer fraud is going on, there's 10 to
15 types of fraud going on," Szwak says.
Learning to spot and avoid cars with rolled back mileage
may save you a world of hurt.
"The No. 1 piece of advice is they should be
skeptical," Shahan says. "Don't believe the odometer."
Beware of wear and tear
Keep your eyes peeled for inconsistencies. Does the odometer reading
match the mileage stated in the oil change sticker on the car's
window? Does it jibe with the mileage listed in the car's repair
records? Are there marks on the odometer or misaligned numbers?
Does the car show more wear on the brake pedal or rugs than is consistent
with the alleged mileage?
A car with 20,000 miles should have its original tires.
If it doesn't, find out why. Trust your instincts.
"If you've got an inkling that something's not right with a car
you're looking at, it's time to walk away," Morse says.
Sites such as CarFax
let you check a car's history by its vehicle
identification number. You may be able to find out if a car has
had one owner as the seller claims, if the odometer has been rolled
back or if a car has been junked or salvaged.
A CarFax search, while useful, might not provide a
complete history for every auto. The reason? CarFax gets much of
its data from state motor vehicle departments, and some of these
departments are slow to report auto title information.
"They don't always get the data in time,"
Shahan says. "They depend on getting data from states. Some
states are excruciatingly slow in recording the information."
Ask a mechanic you trust
The best advice for used car shoppers is to have the auto inspected
by an independent mechanic before buying.
"Take the car to a good, reliable mechanic to
see if the odometer reading is consistent with the wear and tear
of the car," Morse says.
It can save you a lot of cash and a lot of headaches.
Most consumers learn about odometer fraud when a supposedly low-mileage
car needs all kinds of repairs or when they go to trade in the car
and are offered a much lower price.
"Cars are so sophisticated. There's a lot that
you can't tell by kicking the tires," Shahan says. "It
really takes a pro."
Amy C. Fleitas
contributed to this story.
-- Updated: Aug. 22, 2002
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