The Car and Truck Fleet and Leasing Management Magazine

NADA Urges Federal Action to Reduce Vehicle Title Fraud

May 22, 2008

WASHINGTON, D.C. --- The National Automobile Dealers Association (NADA) is urging the U.S. Department of Justice to finalize a critical rulemaking to help prevent rebuilt, wrecked, flooded or stolen vehicles from ending up on a consumer's driveway.

Each year, millions of vehicles are totaled, and many of them are refurbished and returned to the road with no record of the vehicle's severe damage. In an effort to reduce vehicle title fraud, Congress passed legislation in 1992 creating a national information system to link state DMVs electronically and to mandate that insurers and salvage yards report the VINs of junk and salvage vehicles to the National Motor Vehicle Title Information System (NMVTIS).

In a May 20 letter to Attorney General Michael Mukasey, NADA, consumer protection groups, law enforcement and auto industry representatives implored the Justice Department to make the NMVTIS rulemaking a priority by quickly finalizing the regulations to implement the insurance and salvage yard VIN disclosure requirements under the Anti-Car Theft Act.

In addition, the letter urges the Justice Department to make the NMVTIS data readily accessible to the public (via a Web site or similar electronic media) without waiting for the rulemaking to occur.

"The auto industry and consumer advocates share the same goal of ensuring that salvage vehicle reporting requirements are enforced under the law," said Ivette Rivera, executive director of legislative affairs for NADA. "NMVTIS presents an important opportunity to track potentially dangerous salvage vehicles -– whether it is keeping a problem vehicle off a dealer's lot or helping consumers spot a severely damaged vehicle."

The Justice Department has failed to meet the Congressional deadline of January 1998 for implementing the rules for the NMVTIS database.  Consequently, vehicle salvage fraud, title-washing and VIN cloning (switching the VIN of a stolen car with the VIN of a similar make and model) continues to plague used car buyers.

NADA, founded in 1917 and based in McLean, Va., represents about 20,000 new-car and truck dealers with nearly 43,000 separate franchises, both domestic and import.


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