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Dealer Fraud: Flood Vehicles Flood the Market

On Behalf of | Sep 15, 2015 | Dealer Fraud

The Pennsylvania Attorney General recently issued a press release providing some recommendations for avoiding flood vehicles. According to the Federal Trade Commission, recent flooding in the Midwest and Southeast could spell trouble for car buyers throughout the country.

Annually, floods and hurricanes occur throughout the United States in which thousands of vehicles are fully or partially submerged and damaged. A common form of dealer fraud is the dealer not providing disclosure of this flood history.

When a dishonest dealer or owner makes cosmetic repairs and moves one of these vehicles out of the state where the damage occurred, the title gets “washed,” thereby omitting all evidence of flood or vehicle reconstruction from the title.

The car is then shipped to other states and sold to unsuspecting buyers. What looks like a good deal to the buyer may turn into a series of costly repairs and a safety threat down the road.

The Attorney General encouraged consumers to do the following to avoid purchasing a flood-damaged vehicle:

· Have the vehicle inspected by a trusted mechanic before agreeing to a purchase.

· Look inside the trunk, spare tire compartment, glove compartment and dome lights for evidence of moisture, silt, rust or corrosion.

· Check the engine for water damage or moisture.

· Examine all areas for signs of rust, including the underside of the vehicle, door hinges and seat springs.

· Look for dirt or dried mud under the dashboard, floorboard carpet or in air vents.

· Perform a diagnostic check of all electrical systems and look for brittle wire casings, rust or corrosion.

These are all things, of course, that dealers are well-are of and do as a matter of routine. It is virtually impossible for a dealer not to know that a vehicle has been in a flood.

Consumers should check the following resources and verify that the vehicle history report has the most current information:

· The National Insurance Crime Bureau (NICB) maintains a free database at www.nicb.org that allows consumers to check for flood damage using vehicle information numbers (VINs).

· AutoCheck provides a free “storm damage scan” for consumers at www.autocheck.com .

· The National Motor Vehicle Title Information System (NMVTIS) allows consumers to check a vehicle’s history at www.vehiclehistory.gov .

Attorney General Kane advised consumers to understand the difference between a flood title and a salvage title.

A flood title means the vehicle was damaged from sitting in water deep enough to fill the engine compartment.

A salvage title means the car was declared a total loss by an insurance company that paid a claim on it. The criteria for declaring a salvage title varies by state, and a small number of states give stolen vehicles a salvage title.

If you or someone you know has been the victim of consumer fraud, you or they should contact a qualified attorney immediately.

It’s important to know your rights before you try to vindicate your rights.

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