Dealer Fraud

Buying a used car is always the best option for customers who can’t afford a new car. Used car dealerships are the most convenient places for finding used cars at a discounted and moderate price. The pre-owned cars are usually sold through independent dealers, franchises, rental car companies, auctions, private sales and leasing companies.

Buying used cars is most popular in California. The comparatively low price and the opportunity to save a rather big amount of money attacks a lot of car buyers. However, buying a used car may sometimes be complicated. Used cars may have hidden mechanical problems, in some cases they may have been previously wrecked and rebuilt.

Very often car dealers sell you these cars without disclosing the problems and the history of the vehicle. These are typical cases of car fraud. That’s why you should always get a vehicle history report of the vehicle you consider buying. Vehicle history reports are very easy to get. They protect you against purchasing used cars with costly hidden problems. The reports contain any information about accidents or major repairs, any lemon law buybacks, odometer fraud and other relevant data on the vehicle.

In some cases buying a used car makes more sense than buying a new car, especially for those consumers who are trying to save money or invest it on something else. This allows you to get a new car and trade in the old one.

According to some statistics 2.5 million cars are wrecked annually. One million of these vehicles end up back on the road again. Reading this article you can find several very useful tips on how to buy a used car and avoid most common dealer frauds.
Always use Vehicle History Reports to negotiate a lower price, check salvaged, wrecked and odometer fraud cars. Print out questions for you to ask the dealer. If you are buying a used car, make sure to get an AutoCheck Vehicle History Report on the Vehicle Identification Number (VIN). Also have a mechanic inspect the car on a lift. Your mechanic can put the car on a lift and instantly spot hidden frame damage, corrosion, previous crash damage, and fluid leaks. However you should know that your mechanic can’t tell you if your car title has been branded as a flooded vehicle, salvaged, rebuilt, stolen, junked, or passed through a salvage auction.

Very often used cars may be wrecked, re-built and then legally re-sold to unsuspecting car buyers. The used car seller can even get a clean title and bill of health and the used car buyer may never know the car had been wrecked and/or “totaled” in an accident!

However, you can still find out the car’s true condition if before the purchase you have it inspected by an independent mechanic.

The car that has been caught in a flood and later salvaged and cleaned up for re-sale to unsuspecting car buyers is known as a flood car. According to the law the title of a flood car is supposed to state that the car has been under water, but you can’t be sure that the title held by the used car dealer is legitimate.

The used car dealer may not know the car has been flooded so the only thing you can do to make sure is to inspect used vehicles thoroughly yourself or have a good mechanic do it. It is a good idea to check under the hood for corrosion and look for water lines indicating how high the water level may have reached during a flood. Also, check under the dashboard, seats and floor mats for signs of dirt and/or sand.

One of the forms of auto fraud that is widely used by car dealers is the misrepresenting the true condition of the vehicle. The dealer may tell the customer that the vehicle is in excellent condition and the customers believe this just because the vehicle is cosmetically clean and mechanically sound. Unfortunately, this is not always the truth. Be extra cautious if the vehicle you intend to buy comes without a warranty or “as is.”

Vehicles that have been wrecked, declared a total loss by an insurance company, or rebuilt have a salvage title. The title of the vehicle must disclose that the vehicle is salvage. Car dealers must disclose any salvage history to the buyers. The price of a salvaged vehicle is generally much less than an equivalent non-salvaged vehicle. Salvaged vehicles may have major safety defects depending on how well it was rebuilt.

There are vehicles that have been wrecked and rebuilt, but were not declared a total loss by an insurance company. These types of vehicles are much harder to identify because they do not carry the salvage title.

Avoid this dealer fraud by having the vehicle you intend to buy inspected by a mechanic and/or an auto body repairperson before you buy it. Always get a vehicle history report. You can get summary title reports from: Carfax (www.carfax.com) and AutoCheck (www.autocheck.com).

If you believe you are a victim of this auto fraud, you should contact a dealer fraud attorney.

It is common for dealerships to sell cars without disclosing that they were previously wrecked or salvaged. In case you have recently purchased a vehicle and you suspect it may have been in a serious accident before you bought it, you should take the following steps. First, have your car inspected by a qualified mechanic and ask for a complete report. If the inspection reveals that the frame is bent or the vehicle has safety-related problems, then you may have a possible case against your car dealer.
If the vehicles have been in an accident and the insurance company or leasing company “totaled” the vehicle, then the vehicles should be repaired at licensed repairers and then checked for safety. These vehicles may be with full disclosure of their salvage status sold if they pass the safety inspection. The vehicle must be titled as “salvage” by the insurance company that totaled it. If at the time of the purchase the car dealer failed to disclose that the vehicle you intend to buy is a salvage vehicle, consult a dealer fraud attorney.

__________________________________________________

[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]

If you discover that the vehicle you have purchased has been wrecked prior to ownership have the vehicle inspected by an expert body shop. Also have a written report completed. After this, contact an experienced auto dealer fraud attorney who will conduct the remaining investigation and evaluate the case.

__________________________________________________

[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]

The California Department of Insurance reported that Robert Andrew Nelson, 44, a resident of Cathedral City, California, was arrested on April 28 for allegedly defrauding his insurance company of $26,000. On October 28, 2007 Nelson filed a false police report and knowingly presented a fraudulent insurance claim. He reported that on October 27 he hosted a gathering of about a dozen quests. He claims that his guests were still at his home, when he went to sleep at about 8 p.m. Nelson claims that in the middle of the night someone stole his 2005 Expedition from his driveway and then returned it. According to Nelson he found the wrecked and damaged vehicle next morning.

After filing a claim with his insurance company Nelson received $26,000 as the replacement costs for the damaged vehicle. However, later a witness contacted the insurance company and informed that in the morning of October 28 Nelson’s vehicle struck another car.

The further investigation revealed Nelson was the driver of the vehicle at the time of the crash. Another witnessed informed that saw how Nelson walked around his vehicle after the crash. The third witness claimed that there were no other cars present, while Nelson claimed he hosted a gathering.

If convicted, Nelson could face a two to five year prison sentence and fine of up to $50,000.

__________________________________________________

[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]

Previously, wrecked, damaged ,flooded and poorly repaired vehicles were sometimes sold as “certified.” However, now a new California law prohibits the sale of used cars as certified if they had rolled back odometer reading, had been in a flood or had been previously wrecked (unless properly repaired). California car dealers can’t also sell certified cars “as is.”
Pursuant to the new law if cars previously damaged in a wreck or flood and not properly repaired and if the repairs did not make the car safe, then the car cannot be sold as “certified”. Also if the repairs of wrecked, damaged and flooded cars substantially impaired the use of the vehicle, it cannot be sold as certified.

__________________________________________________

[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]