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Flood Damaged Cars Being Resold

Roseville, Calif.- In the destructive aftermath of Hurricanes Harvey and Irma in September 2017, hundreds of thousands of new and used cars were left flooded.ย  Some reports indicate that 500,000 to nearly 1 million vehicles may have been flooded.

It is projected now that the used car market will be “flooded” (no pun intended) with water-damaged vehicles.ย  One source says that within days of the storms, scammers began dumping affected cars into their used car inventory.ย  While many of these cars end up in the scrapyard, flood-damaged cars can be sold again to unsuspecting consumers.

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senior consumer advice editor for Edmunds says these damaged vehicles are often sold at independent used car dealerships or by private sellers through classified listings.ย  The cars aren’t just re-sold in the storm-affected areas, buyers throughout the country are at risk.

Why is law enforcement interested in this subject?

Because the resale of salvaged vehicles with “washed titles” (switched VIN numbers) is Fraud.  The National Insurance Crime Bureau (NICB) works with law enforcement agencies to protect consumers against scammers who try to sell such severely damaged vehicles.  Anything that is ruled a total loss by an insurance company should get a salvage title.  The problem occurs when unethical dealers buy the cars cheap at auction, clean them up, switch the VIN (Vehicle Identification Number) and retitle them in a different state without disclosing the flood damage.  Flood damage in cars can short the electrical system, cause corroded mechanical parts (especially from salt water flooding) and diminish safety features like airbags and anti-lock brakes.  There are also health risks such as mold and bacteria that can linger.

Here are some telltale signs of flood damage in a car:

* Musty odor
* Damp or discolored carpeting
* Brand new upholstery in an older car
* Fogging inside headlamps or tail lights
* Water line inside headlamps or under hood
* Mud or silt in the glove compartment, trunk or under seats
* Rust around doors, under the dashboard, the undercarriage or inside the hood and trunk latches
* Rust on tire changing tools attached to spare tire

The main form of buyer protection is checking the title history to make sure that it has no record of being marked as “salvage” or “beyond repairable.”  Vehicle history reports are available from various companies including Carfax, AutoCheck and the National Insurance Crime Bureau’s free VINcheck site.  NICB’s VINcheck website will help buyers determine if a specific vehicle has been reported previously as a declared loss vehicle or even reported stolen but not recovered.

January through March is typically high used-car-buying-season because people use tax refunds for this purpose.  Buyer beware.  Is the car for sale from out-of-state?  Did you see the car you’ve been looking for with a price that seems too good to be true?  Did you see the words salvage title?  You need to know that salvage title voids any vehicle warranty.  While it’s legal to sell salvaged cars, that fact must be disclosed and the vehicle must pass certain operational safety tests in order to be allowed on the road.

Resources:ย  National Insurance Crime Bureau; RPD officer, Member of Vehicle Fraud Task Force; AccuWeather; Edmunds; Fox News; New York Times; Consumer Reports

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