Indiana Consumer Fraud

What is Auto Fraud?

Fraud may be committed by an automobile dealership by misrepresenting or failing to disclose such things as the true condition of the vehicle (i.e., whether the vehicle was involved in an accident or sustained some type of damage when in possession of a prior owner), the true mileage of a vehicle or the true ownership history of the vehicle. Fraud may also occur when a dealership allows a consumer to take delivery of a vehicle prior to obtaining financing, promises to obtain financing, fails to do so and then refuses to return the consumer’s down-payment or trade-in vehicle.

Different types of fraud that can occur during a vehicle transaction may include;

  • ODOMETER FRAUD: the mileage that is showing on the odometer of the vehicle at the time of purchase determines the condition and value. The issue of possible fraud comes into play if;
    • the odometer has been disconnected or turned back.
    • the vehicle’s mileage was misrepresented to you.
  • PRIOR DAMAGE OR SALVAGED, WRECKED VEHICLES: some dealers have been selling poorly rebuilt wrecked or salvaged vehicles, which may turn out to be unsafe or priced too high. The majority of these vehicles were involved in accidents or floods. Though they look good on the surface, they may have steering problems, defective brakes, inadequately welded parts and overall, poor handlingIt is the responsibility of the selling dealer to inform you before purchase if the car has, to their knowledge, a “salvage title” or has been involved in an accident.Be certain to inspect the vehicle thoroughly if you intend to take it home! Look for the following;
    • even matching of paint on the outside and inside of the door frame.
    • the parts of the car should line up with each other and the spaces between the hood and trunk and around the doors are straight.
    • flood damage is fairly evident in certain vehicles by the presence of mud or dirt under the mat in the trunk, or moisture under the seats or inside the trunk or hood. There may also be watermarks inside the doors.
    • if the car has an out of state title, it may have been moved to another state due to its extensive damage.


A dealer must not withhold information as to the condition of the vehicle at the time of purchase. No buyer wants to find out about damage to their “new” car after they have assumed possession and the car is in their driveway. Whether your vehicle was involved in an accident, holds a salvage title, or was damaged due to flood, you have the right to know, prior to purchase and can not be deceived as to your cars past “life”.


Another practice used by some dealers is selling vehicles that were used for rental purposes and claiming these were “executive driven”. The consumer purchases the vehicle, believing that only one owner drove and owned it. Later, extensive problems may surface, some of which are due to excessive wear and tear caused by many different drivers having driven and used the vehicle.


  • Check the vehicle over thoroughly to see if the actual condition matches the mileage that is showing in the odometer.
  • If the vehicle has been repainted, look to see which parts have been replaced. Paint can be used by offenders to cover older parts, thus giving the vehicle a newer look.
  • Look in the left door frame, inside left front window, in the glove compartment, under the hood, or in the trunk, for maintenance and oil change/lube stickers that could contain accurate mileage information.
  • Be wary of a vehicle advertised or represented as part of a fleet, that has especially low mileage.
  • The numbers should be aligned properly on the odometer gauge, crooked or misaligned numbers could be a sign of tampering;*GM vehicles with mechanical odometers have black spaces between the numbers. If the spaces are silver or white, the odometer has been tampered with.*Electronic odometers are built to show tampering, represented by an asterisk or some other mark in the display. Your owners manual will have more information on this feature.
  • You MUST be provided with a written statement of the actual mileage disclosed on the odometer at the time of purchase, if you are not given this document you may already have a claim under the Truth In Mileage Act.

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