CARFAX: Odometer Fraud Increases Nationwide to 2.14 Million Vehicles

Rhea-AI Summary

CARFAX reports a significant increase in odometer fraud nationwide, with over 2.14 million vehicles potentially affected in 2024, marking an 18% rise since 2021 and adding 82,000 more cases from the previous year. The fraudulent practice, which can be executed quickly using modern technology, costs unsuspecting buyers an average of $4,000 in lost value, plus additional repair costs.

Nine out of the top 10 states reported increases, with Virginia showing the highest spike at 11.7%, followed by Arizona at 8.0% and Florida at 6.4%. The fraud typically occurs when sellers alter vehicle mileage displays to avoid lease charges or increase vehicle value.

Positive

• None.

Negative

• Odometer fraud increased 18% since 2021, affecting 2.14 million vehicles
• Average loss of $4,000 per affected vehicle for buyers
• Virginia reported 11.7% increase in fraud cases
• Modern technology makes odometer fraud easier to execute

Insights

Market Research Analyst

The surge in odometer fraud represents a significant market dynamic affecting the used car industry and SPGI's subsidiary CARFAX. With $4,000 average loss per incident and 2.14 million affected vehicles, this translates to potential market losses of $8.56 billion. The 18% increase since 2021 indicates a growing systemic problem that strengthens CARFAX's value proposition and market position. This trend could drive increased demand for vehicle history reports and verification services, potentially boosting SPGI's information services revenue stream. The geographic expansion of this fraud, particularly in key markets like Virginia (11.7% increase), Arizona (8.0%) and Florida (6.4%), suggests a broader market opportunity for fraud detection services.

Legal Expert

The escalating odometer fraud trend presents significant legal implications and opportunities for SPGI's CARFAX division. The federal Truth in Mileage Act makes odometer tampering a criminal offense and this widespread fraud (2.14 million vehicles) creates a compelling regulatory compliance use case for CARFAX's services. The documented financial impact of $4,000 per incident strengthens civil litigation potential and positions CARFAX as a critical tool for consumer protection. This growing fraud pattern may lead to stricter regulatory oversight and mandatory vehicle history checks, potentially expanding CARFAX's market reach and regulatory importance.

Up More Than 18% Since 2021, Costing Unsuspecting Buyers Thousands of Dollars

CENTREVILLE, Va., Dec. 10, 2024 /PRNewswire/ -- Odometer fraud remains a widespread and serious issue for used car buyers across the country, CARFAX data shows. More than 2.14 million cars on the road may have had their odometer rolled back this year, up more than 18% since 2021, and up more than 82,000 vehicles from just last year.

"Odometer rollbacks can occur when an unscrupulous owner or seller of a car alters the miles that display on a car's gauge cluster," said Faisal Hasan, Vice President of Data and Public Policy at CARFAX. "This might be done as a way to avoid mileage charges in a vehicle lease or to dramatically increase the value of a car. Today's technology makes rolling an odometer back easier than ever." It can take a bad actor just seconds to roll back an odometer, causing unsuspecting buyers to lose an average of $4,000 in value, CARFAX found, not to mention the additional costs of unexpected repairs and potential safety risks.

"I located a beautiful Chevy 4x4 Truck that sounded perfect: Low miles, great condition, etc. When I ran the CARFAX on the vehicle, I discovered the truck had approximately 180,000 miles rather than the 108,000 stated," said Jimmy Hendon, a driver in Atlanta. "The mileage was so far off from the accurate mileage that it was crazy. CARFAX saved me thousands of dollars and no telling how many headaches."

Nine of the Top 10 states with the most vehicles with rolled back odometers saw an increase this year. Virginia saw the biggest spike last year, at nearly 11.7%, followed by Arizona, up 8.0%, and Florida, up 6.4%.

How to protect from odometer fraud:

1. Check for potential odometer fraud at www.carfax.com/odo.
2. Obtain the CARFAX report for the vehicle's history and check the title, maintenance, and inspection records to compare the mileage on the vehicle.
3. Check out the wear and tear at the gas, brake, or clutch pedals.
4. Always have a trusted mechanic inspect the car before a purchase. They should be able to tell if a vehicle looks older than its odometer suggests.

Editor's note: We have a media tour on Dec. 10, 2024. A CARFAX expert and a mechanic will be standing by to show how easy it is to roll back a vehicle's odometer in real-time. Localized data available upon request. Please contact Em Nguyen at emnguyen@carfax.com.

About CARFAX

CARFAX, part of S&P Global Mobility, helps millions of people every day confidently shop, buy, service and sell used cars with innovative solutions powered by CARFAX® vehicle history information. The expert in vehicle history since 1984, CARFAX provides CARFAX Used Car Listings, CARFAX Car Care, CARFAX History-Based Value and the flagship CARFAX Vehicle History Report to consumers and the automotive industry. CARFAX owns the world's largest vehicle history database and is nationally recognized as a top workplace by The Washington Post. Shop, Buy, Service, Sell – Show me the CARFAX®.

S&P Global Mobility is a division of S&P Global (NYSE: SPGI). S&P Global is the world's foremost provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity and automotive markets.

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SOURCE CARFAX

FAQ

How many vehicles were affected by odometer fraud in 2024?

According to CARFAX, more than 2.14 million vehicles were potentially affected by odometer fraud in 2024.

What is the average financial loss for buyers due to odometer fraud?

CARFAX found that unsuspecting buyers lose an average of $4,000 in value due to odometer fraud, not including additional repair costs.

Which state saw the highest increase in odometer fraud cases in 2024?

Virginia saw the biggest spike in odometer fraud cases at 11.7%, followed by Arizona at 8.0% and Florida at 6.4%.

How much has odometer fraud increased since 2021?

Odometer fraud has increased by more than 18% since 2021, with an additional 82,000 cases reported from the previous year.