By Mike Antich
Digital odometer fraud is growing at an alarming rate, according to new research from Carfax. The research data reveals the number of vehicles with rolled-back odometers has increased 57 percent nationwide over the past four years. According to NHTSA, more than 450,000 cases of odometer rollbacks are reported annually. However, the total number of odometer tampering incidents (including those not caught) is estimated to be substantially higher. The veracity of these estimates seems to be reinforced by the newly released Carfax data.
“Odometer fraud is alive and well,” said Larry Gamache, communications director at Carfax. “Con men continually find ways to cheat the system, especially in a soft economy like this, and digital odometers are no exception.”
Jack Gillis of the Consumer Federation of America agrees: “We estimate one in 10 cars have their odometers rolled back. Sellers obviously make more money if a car’s mileage is deflated.”
Clocking Targeted Fleet Vehicles
Clocking an odometer is an industry term meaning a vehicle’s odometer or documentation (or both) has been altered and the difference not disclosed to the buyer. Up to the 1970s, clocking was often associated with fleet vehicles. In October 1972, the U.S. Congress passed the Motor Vehicle Information and Cost Savings Act, popularly known as the Odometer Act. Fleet resale values were negatively impacted with the passage of the federal Odometer Act. As a result of the odometer legislation, fleet depreciation costs increased due to the higher vehicle mileage at time of resale. Prior to the federal Odometer Act, mileage really meant very little because “spinning,” “clocking,” or whatever term was used, was an accepted practice by many unscrupulous vehicle remarketers. Cars with more than 40,000 miles were virtually impossible to retail by dealers in the 1970s, who “clocked” them to make them saleable. “The buying automotive public demanded low mileage and they got it,” said one fleet lessor of the time in a published 1974 interview in Automotive Fleet magazine.
Today, odometer tampering continues to be a problem for vehicles on retail leases, especially those leased by self-employed business people and those employed as sales or manufacturer reps. Often, these individuals exceed the annual miles allotted under the lease and face substantial mileage penalties at the end of the lease term. Some of these individuals are prone to entertain the idea of clocking an odometer. All too often, these individuals do not view themselves as criminals, but rather as resourceful or wily businesspeople who found a way to “beat the system” and avoid paying a mileage penalty. An informal grapevine exists among retail lessees, especially those within specific professions that pass on the names of mechanics who might be agreeable to rolling back an odometer for a price.
The federal Truth in Mileage Act (TIMA) of 1986 requires sellers to provide actual (truthful) odometer readings and to dis-close any known inaccuracies. TIMA made odometer fraud a felony. Failure to disclose that an odometer has been changed or repaired (altered in any way) and/or falsifying mileage documentation will result in fines and/or imprisonment. Any time a vehicle’s ownership changes hands, its mileage at the time of sale must be declared. TMU (True Mileage Unknown) is the acronym used when an odometer’s mileage cannot be verified. A TMU designation lowers a vehicle’s resale price.
Digital Odometers are not Tamper-Proof
Many new cars are equipped with digital odometers that store the mileage in the vehicle’s engine control module (ECM), making it difficult (but not impossible) to manipulate the mileage electronically. Even though mileage is recorded on the ECM, nothing prevents a clocker from purchasing a chip at a wrecking yard from a similar model vehicle with less mileage and substituting it on the vehicle. In other instances, odometer mileage is more difficult to manipulate. For example, odometers now add mileage driven in reverse to the total as if driven forward, to accurately reflect the true total wear and tear on the vehicle. (Older vehicles could be driven in reverse to subtract mileage.)
The introduction of digital speedometers initially was thought to provide a means to minimize odometer tampering. However, this has not proven the case, as the Carfax data demonstrates. Tampered digital odometers are even harder to identify than mechanical odometers since there are no visible moving parts. Clockers use the same tools meant to correct mileage on digital odometers to rollback mileage.
“Unscrupulous people using relatively inexpensive software and devices available legally for re-calibrating faulty odometers can reprogram digital odometers,” said Gamache of Carfax. For instance, digital odometer calibrators can be purchased online, and despite “disclaimers” from sellers, they are used by some for odometer fraud. In addition, foreign companies sell software on the Internet to anyone who wants to roll back a digital odometer.
With older mechanical odometers, the speedometer can be removed from the dashboard and the digits wound back or the drive cable can be disconnected and connected to another odometer/speedometer pair while on the road. By simply unhooking the odometer, an unscrupulous lessee or mechanic can either clock the odometer or reinstall the odometer to a halfer, a device which records only half the miles actually driven. The ability to clock an odometer can be easily done by those determined to do so. Any competent, but unscrupulous mechanic can roll back an odometer. Many lessees seeking to avoid mileage penalties purchase reducers or halfers from a local electronics store that record only a fraction of the actual mileage driven.
Clues that Clocking has Occurred
Used-vehicle buyers can’t always tell by just looking at a vehicle if its odometer has been rolled back. Although difficult, it is possible to detect an altered odometer. Carfax has compiled the following tips to detect odometer fraud:
• Ask to see the title and compare the mileage on it with the vehicle’s odometer. Be sure to examine the title closely if the mileage notation seems obscured or not easy to read.
• Compare the mileage on the odometer with the mileage indicated on the vehicle’s maintenance or inspection records. Also, search for oil-change and maintenance stickers on windows, door frames, in the glove box, or under the hood.
• Request a Carfax Vehicle History Report to check for odometer discrepancies in the vehicle’s history. If the seller doesn’t have a vehicle history report, use the vehicle’s VIN to order a Carfax vehicle history report online.
• Check that the numbers on the odometer gauge are aligned correctly. If they’re crooked, contain gaps, or jiggle when you bang on the dash with your hand, walk away.
• Examine the tires. If the odometer displays 20,000 miles or less, the vehicle should still have the original tires.
• Inspect the wear and tear on the vehicle – especially the gas and brake pedals, floor mats, steering wheel, etc. – to be sure it is appropriate for the number of miles displayed on the odometer.
• Ask a trusted mechanic check the vehicle’s onboard computer and inspect the vehicle thoroughly prior to purchase.
To check for potential odometer rollbacks free of charge, you can visit www.Carfax.com/odo.
Keeping a Clean Reputation for Fleet Vehicles
In prior decades, fleet vehicles were often targeted by clockers because they were high-mileage, late-model vehicles. Since fleet vehicles had a past reputation of being clocked, along with the fact that it has taken decades to remove this stigma, a new increase in odometer tampering threatens to dredge up this negative (but erroneous) image of fleet vehicles. It’s in everyone’s interest to put clockers out of business and behind bars. Clocking is a federal crime all of us should diligently work to identify and eliminate.
Let me know what you think.