Department of Justice

U.S. Attorney’s Office

Southern District of Mississippi

FOR IMMEDIATE RELEASE

Wednesday, January 22, 2020

Two Mississippi Men Sentenced for Roles in Automotive Fraud Scheme

Two Long Beach, Mississippi men were sentenced today for their roles in a long-running odometer tampering scheme, the Department of Justice announced.

U.S. District Judge Louis Guirola Jr. sentenced Oscar M. Baine, 42, to 36 months’ incarceration and ordered him to pay $619,200 in restitution. Jeffrey Lyn Savarese II, 36, was sentenced to 15 months’ incarceration and ordered to pay $320,000 in restitution. Both men pleaded guilty in July to conspiracy to alter odometers. Baine also pleaded guilty to odometer tampering.

As part of his guilty plea, Baine admitted that he purchased high-mileage vehicles from wholesale automobile auctions, dealerships, and individuals, and arranged to alter the vehicles’ odometers to reflect false, lower-mileage readings. Baine admitted that he paid Savarese and others to change or alter odometers at his used car lot in Gulfport. Baine then sold the rolled-back vehicles to unsuspecting consumers for inflated prices. He also admitted that he and a co-conspirator caused at least 387 vehicles to be rolled back between 2011 and 2014, which resulted in consumer losses of more than $600,000. Savarese admitted that he began altering odometers for Mississippi and Louisiana used-car dealers in 2011 and reset the odometers on at least 200 used vehicles for Baine.

“The Department of Justice has long been committed to prosecuting automobile dealers, wholesalers, and mechanics who defraud consumers by selling vehicles with unlawfully altered odometers,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Vehicle mileage is critical to consumers who rely on that information to evaluate the value and safety of a used vehicle.”

“These criminals not only defrauded hundreds of people but they directly put families and the general public at risk,” said U.S. Attorney Mike Hurst of the Southern District of Mississippi. “We will continue to do all that we can to protect our citizens from fraudsters who endanger others just to make a quick buck.”

Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Andrea Jones of the U.S. Attorney’s Office for the Southern District of Mississippi prosecuted the case. The National Highway Traffic Safety Administration Office of Odometer Fraud Investigation (NHTSA), assisted by the State of Mississippi Office of the Attorney General, investigated the case.

NHTSA estimates that odometer fraud in the United States results in consumer losses of more than $1 billion annually. Individuals with information relating to odometer tampering should call NHTSA’s odometer fraud hotline at (800) 424-9393 or (202) 366-4761. More information on odometer fraud is available on the NHTSA website at https://www.nhtsa.gov/odometer-fraud and tips on detecting and avoiding odometer fraud are available at www.nhtsa.gov/staticfiles/nvs/pdf/811284.pdf .

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.

Clocking is still affecting 6.49% of UK vehicles today

Dashboard of car

A Rapid Car Check survey has found that 6.49% of vehicles have mileage issues.

In a pool of 1 million, 64,986 were found to have issues, despite members of the European Parliament voting in favour of new legislation to combat mileage clocking in cars in 2018.

The most common clocked vehicles were the Renault Grand Scenic and Renault Scenic, with a fail percentage of 32.66% and 32.14% respectively.

The most common year of vehicle registration was 1998 with a 16.47% fail rate. Vehicle registered in the 1990’s made up six of the top 10, with no vehicles registered after 2003 present.

Overall, rapid check estimates that 2,479,180 vehicles in the UK have mileage issues.

Before passing legislation in 2018, German MEP Ismail Ertug said around 50% of used cars sold inside the EU, and between 30% and 50% of cars sold across borders within the EU, had been clocked.

MEPs called new legislation that included national mileage registers to be made accessible across borders. Car buyers should be able to verify mileage readings regardless of the country it was previously registered.

They also called for carmakers to set clear criteria for checking that odometers are tamper proof.

Barry Shorto, head of industry relations at cap hpi, said at the time: “In Belgium and the Netherlands where readings are collected more frequently than elsewhere, odometer fraud has been almost eradicated.

“We fully support calls for mileage alternation or clocking to be made a criminal offence. Even though clocking has a negative impact on road safety, only six EU countries recognise odometer manipulation as a criminal offence.”

Original Article: https://www.motortrader.com/motor-trader-news/automotive-news/clocking-still-affecting-6-49-uk-vehicles-today-07-08-2019

Car dealers linked to Columbia Count licenses revoked for odometer fraud

ARLINGTON, Wis. – The Wisconsin Department of Transportation Division of Motor Vehicles has revoked the licenses for two car dealers with ties to Columbia County.

An investigation by the Wisconsin Department of Transportation’s Dealer and Agent Section found that Best Motors and Manhattan Motors sold vehicles with mileage discrepancies, which is in violation of state law. The dealerships have licenses operated out of Arlington, Wisconsin. The licenses are linked to a business at 101 Skyline Drive in Arlington. Under Wisconsin state law, each licensee must have an office location and Best Motors and Manhattan Motors are registered to this location.

It is possible that these licenses belong to dealerships operated in another state.

The Wisconsin Department of Transportation’s Dealer and Agent Section licenses, regulates and resolves disputes about dealerships sales and warranty repairs, as well as educates the motor vehicle industry and public. The group also investigates complaints about odometer tampering involving dealerships and private sellers.

Original Article: https://www.channel3000.com/news/two-columbia-county-car-dealerships-have-licenses-revoked-for-odometer-fraud/1105810604

Two Mississippi Men Plead Guilty in Odometer Fraud Scheme

US Dept of Justice Logo

Two Long Beach, Mississippi, men pleaded guilty today for their roles in a long-running odometer tampering scheme, the Department of Justice announced.

Oscar M. Baine, 41, pleaded guilty to one count of conspiracy to alter odometers and one count of odometer tampering. Jeffrey Lyn Savarese II, 35, pleaded guilty to one count of conspiracy to alter odometers. Both defendants appeared in federal court in Gulfport before U.S. District Judge Louis Guirola Jr. The court set sentencing hearings for both defendants for Oct. 17.

As part of his plea agreement, Baine admitted that he purchased high-mileage vehicles from wholesale automobile auctions, dealerships, and individuals, and arranged to alter the vehicles’ odometers to reflect false, lower-mileage readings. Baine admitted that he paid Savarese and others to change or alter odometers at his used car lot in Gulfport. Baine then sold the rolled-back vehicles to unsuspecting consumers for inflated prices. Savarese admitted that he began altering odometers for Mississippi and Louisiana used-car dealers in 2011 and reset the odometers on at least 200 used vehicles for Baine.

“The Department of Justice is committed to prosecuting auto dealers who defraud consumers by selling vehicles with unlawfully altered odometers,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Consumers rely on mileage information to assess the value and safety of a vehicle, and that information must be accurate.”

“These criminals put the public at risk by rolling back odometers and defrauding hundreds of people out of one of their biggest investments. I commend the investigators and prosecutors for bringing these criminals to justice and for protecting the public from further fraudulent acts by these two. We will remain vigilant as to these types of crimes and continue working to make our roads and communities safer for everyone,” said Mike Hurst, U.S. Attorney for the Southern District of Mississippi.

In pleading guilty, Baine admitted that he and a co-conspirator caused at least 387 vehicles to be rolled back between 2011 and 2014, with resulting consumer losses of more than $600,000. Baine also admitted that, at times, the altered odometers and fraudulent titles included false mileages that were more than 100,000 miles less than the vehicles’ actual mileages.

Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Andrea Jones of the U.S. Attorney’s Office for the Southern District of Mississippi are the prosecutors for the case. The National Highway Traffic Safety Administration Office of Odometer Fraud Investigation (NHTSA), assisted by the State of Mississippi Office of the Attorney General, investigated the case.

NHTSA estimates that odometer fraud in the United States results in consumer losses of more than $1 billion annually. Individuals with information relating to odometer tampering should call NHTSA’s odometer fraud hotline at (800) 424-9393 or (202) 366-4761. More information on odometer fraud is available on the NHTSA website at NHTSA.GOV/odometer-fraud and tips on detecting and avoiding odometer fraud are available at NHTSA.GOV/staticfiles.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at Justice.gov. For more information about the U.S. Attorney’s Office for the Southern District of Mississippi, visit Justice.gov.

Original Article: https://www.justice.gov/opa/pr/two-mississippi-men-plead-guilty-odometer-fraud-scheme

State investigating odometer fraud complaint against business owned by Lee County deputy

FORT MYERS, Fla. — A Lee County deputy who once campaigned for sheriff is on administrative leave, and now his business is under investigation by a state agency.
James Didio ran for Lee County Sheriff in 2016. Fox 4 has learned that a customer of Didio’s used car business, Southwest Florida Motors in Fort Myers, claims that someone rolled back the odometer on a car they bought there.

Last week, the Lee County Sheriff’s Office confirmed that Didio has been placed on administrative leave, but would not say why.

Fox 4 found that a customer complained to the Better Business Bureau in March that a car purchased at Southwest Florida Motors showed an odometer reading of about 107,000 miles. The complaint states that “the car has over 160,000 miles, but shows 107,000 from having the odometer illegally changed.” The customer claims that the discrepancy was discovered by checking oil change records.

In a response to the complaint, Southwest Florida Motors wrote, “The moment I was informed of a possible odometer fraud from years before I ever owned the vehicle, we did a complete AutoCheck Dealer VIN scan. The check came back ‘No odometer fraud found.'”

The Florida Department of Highway Safety and Motor Vehicles is investigating the complaint, but the Lee County Sheriff’s Office will not confirm that is the reason for Didio’s administrative leave..

Didio could not be reached for comment on this story.

Original Article: https://www.fox4now.com/news/local-news/state-investigating-odometer-fraud-complaint-against-business-owned-by-lee-county-deputy

Owner of Powhatan auto electronics repair shop pleads guilty in federal odometer tampering case

Gavel from Richmond.com news article

A Powhatan County man was convicted Monday for his role in a scheme that rolled back the odometers on more than 50 vehicles, fraudulently boosting the value of each one by as much as $10,000.

Michael Carey Eubank, 52, who owns an automotive electronics repair shop in Powhatan, pleaded guilty to conspiracy to alter a motor vehicle odometer and faces up to five years in prison when sentenced Oct. 9 by U.S. District Judge John A. Gibney Jr.

A two-page criminal charge filed June 10 alleged that Eubank’s company website advertised services that included “odometer re-programming or re-setting.” It also stated that, “Mileage proof [is] required, odometer tampering is a federal crime.”

The charge only identified the company as “Company 1.” But Eubank told Gibney on Monday that his company is Advanced Auto Electronics and was formerly located in Midlothian.

From September 2010 to June 2018, Eubank conspired with at least one other person to reset the odometers to false, lower readings. “Individuals brought vehicles, or vehicle instrument clusters containing odometers, to Company 1 and requested that Eubank change the odometers to lower mileage readings,” the government alleged.

The only co-conspirator identified in court papers is Lawson Basnight, 49, of Norfolk, who pleaded guilty to the same charge last year and was sentenced to 18 months behind bars.

Basnight was also ordered to pay more than $403,000 in restitution — the difference in price caused by the false readings plus, in some cases, unexpected repair costs — to more than 50 victims. Basnight admitted running the scam from September 2010 through October 2016.

While the charging document against Eubank referred to multiple odometers, it only cited one specific case: On Feb. 25, 2016, Basnight brought a 2009 Ford F-150 with 165,000 miles on it and Eubank used an electronic tool to reset the odometer to 54,900 miles.

It was unclear Monday if Eubank participated in lowering the odometers of all of the vehicles in Basnight’s scheme and if the same restitution list of victims and losses will be sought in Eubank’s case.

Jacqueline M. Blaesi-Freed, a trial attorney with the U.S. Department of Justice’s consumer protection branch, told Gibney on Monday that the losses were determined by the price Basnight paid for the vehicle and the price ultimately paid by the victims who purchased vehicles at fraudulently inflated prices.

She said that in some cases, unexpected repair bills were added to determine the loss incurred by a victim and in others, where the price difference could not be determined, an average loss figure of $7,868.58 was used — the same average figure used for Basnight.

In Basnight’s case, the false mileage readings on the altered odometers and fraudulent titles were as much as 110,000 miles less than the vehicles’ actual mileage, and Basnight netted as much as $10,000 in profit for each vehicle sold to an unsuspecting buyer.

Basnight found high-mileage vehicles online, at times posing as a used-car dealer or using an alias. When he bought the vehicles, he told the sellers not to fill out the assignment section of the title.

“After defendant Lawson W. Basnight purchased the vehicles, a co-conspirator acting at his direction disconnected, reset, and altered the vehicles’ odometers to reflect inaccurate lower mileage readings,” prosecutors wrote in a sentencing memorandum concerning Basnight.

In response to questions from Gibney on Monday, Eubank said he altered the odometers for $125 a piece and that Basnight usually just brought the unit and left it at the front counter.

Basnight prepared title applications and other documents, writing in false odometer readings in the assignment section of the title. At times, he used unwitting people to obtain the titles and sell the vehicles to an unidentified “major used car retailer.”

“This was a long-running, well-thought-out scheme that [Basnight] ceased only after being caught by law enforcement,” prosecutors complained.

Prosecutors said the scheme not only led to unexpected repair and maintenance costs to the victims but also jeopardized driver safety.

Eubank, who had no prior criminal record, was allowed to remain free pending his sentencing hearing.

The National Highway Traffic Safety Administration estimates that more than 450,000 vehicles are sold each year in the U.S. with false odometer readings, leading to losses of more than $1 billion to consumers.

The NHTSA has established a hotline to handle odometer fraud complaints at (888) 327-4236 (TTY for individuals with hearing impairments: (800) 424-9153).

Original Article: https://www.richmond.com/news/local/crime/owner-of-powhatan-auto-repair-shop-pleads-guilty-in-federal/article_4e258051-c815-5bb6-8744-47f0b6ebb314.html

News car odometer rolled back 45,000 miles by Denver-area business

LITTLETON, Colo. — The U.S. Justice Department calls it “clocking”: intentionally rolling back an odometer to make a vehicle appear less used.

Odometer rollback is “the single most common fraudulent issue in Colorado and nationwide.” That’s a bold statement made by one of this state’s top auto enforcement regulators.

So, based on a tip from one of our viewers, the FOX31 Problem Solvers decided to take a closer look at a business which advertises “odometer correction.”

Odo-Pro is a licensed business registered to the address of a corner house in Littleton.

State records show its owner is Peter Petrov Rains.

He sells parts and auto repair services, mostly through via mail.

Odometer repair and adjustment is permitted in some instances under the federal law. However, “if the mileage on the odometer cannot remain the same as before the service, the odometer must be reset to zero.”

What is not permitted is rolling miles on a vehicle backwards with the intent to defraud.

Here’s part of the federal law which says so:

327.03 A person may not

(2) disconnect, reset, alter, or have disconnected, reset, or altered, an odometer of a motor vehicle intending to change the mileage registered by the odometer;

(3) with intent to defraud..

The FOX31 Problem Solvers tested to see if Odo-Pro would reduce the miles, no questions asked, on one of our old news cars: a 2005 Dodge Durango.

We had a mechanic remove the odometer, which had 195,839 well-documented miles on it.

The FOX31 investigative team then printed off a single-sheet form we found on Odo-Pro’s website. It’s said “Odometer Correction Form” at the top.

We requested our odometer be programmed backwards — rolled back to 150, 839 — a 45,000-mile reduction.

The form required us to acknowledge that “altering the odometer for personal gain is illegal.”

And that “owners have a legal obligation to notify prospective purchasers if the vehicle’s mileage has been altered.”

We mailed our instrument cluster, an $89 cashier’s check from a local convenience store and that form to Odo-Pro in Littleton.

Four days later, our digital odometer came back in a box with “Peter Petrov’s” business card. The mileage was altered per our request: backward 45,000 miles from the original 195,839.

When the Problem Solvers team went to Odo-Pro to ask about its business practices, a man we’d seen working at Odo-Pro answered the door. He said he didn’t speak English. However, FOX31 was able to reach Peter Petrov Rains by phone from the front porch of the business address.

FOX31 asked Rains: “We had some complaints about your Odo-Pro business. That you’re essentially just rolling back odometers.”

Rains responded by telling our reporter, “What we do mainly, uh, we work only with parts. We don’t work on any kind of vehicles. We re-program clusters that have been replaced. So, we do pretty much what dealerships do. Just at a much lower cost.”

When FOX31 asked if he’d like to do an interview to explain how Odo-Pro’s “correction” program works, Rains declined.

While we were standing in front of Odo-Pro, it was hard not to notice the piles of boxes and packets heading to other states via the U.S. Postal Service: Florida, Virginia, Michigan and Pennsylvania, among others.

FOX31 called customers listed on packages, who confirmed some of the boxes indeed contained instrument clusters. None admitted to requesting rollbacks.

Chairman of the Automotive Service Association of Colorado, Brad Pellman, had never heard of Odo-Pro or Peter Rains before FOX31 called.

Pellman was curious how Rains was able to conduct a seemingly vibrant parts-and-services business correcting odometers.

“Until you brought it to my attention, I wasn’t even aware that this was being done by anybody but dealers or some kind of licensed secured facility that had the rights to do it,” Pellman told FOX31 during a recorded interview.

Pellman said that once in a great while, an auto-repair facility might re-set an odometer backwards for a vintage car or some other unique reason, but he says it’s not very common at all.

“Rolling back an odometer is certainly something we don’t even think about doing in our industry,” said Pellman. “The incentive seems to be that it would put less mileage on the odometers for a purpose I would consider fraudulent.”

FOX31 spoke with state and federal authorities who regulate and investigate reported cases of fraudulent odometer rollback services. Although declining on-camera interviews, agents said based on what happened with our TV vehicle’s odometer alone, they have serious questions about Odo-Pro’s business practices.

* FOX31 made certain the Durango — and that odometer — we used for this investigation would not be re-sold except for parts.

Original Article: https://kdvr.com/2019/05/21/news-car-odometer-rolled-back-45000-miles-by-denver-area-business/

Digital rollbacks: Millions of cars have false mileage on odometers

(InvestigateTV) – There’s a hidden danger on the roads – one that’s illegal and potentially putting families at risk: rolled-back odometers.

Experts say vehicle odometers are easier than ever to roll back.

“Our research shows there are now 1.6 million cars that are on roads across the country that have an odometer rolled back, and that’s costing consumers millions of dollars,” said Chris Basso, who works with Carfax, a company that provides vehicle history reports.

In a demonstration with Carfax, an odometer on a 2006 Chevy Silverado with 230,323 miles was tampered with in less than 30 seconds. A technician with an inexpensive electronic device was able to erase nearly 100,000 miles of wear, tear and history, leaving the Silverado with 130,483 miles.

Watch the video below to see a demonstration of an odometer rollback and hear how that affects the value of a vehicle.

“You’re simply taking a device that hacks into the car’s computer. You could take 100,000 miles off a car and artificially inflate the value of it by thousands of dollars, and you’re ripping people off,” Basso said.

Those rollbacks can be dangerous and expensive for consumers.

“You’ve got older parts that you think the car has that could break down sooner than you expect,” Basso said. “If that car’s being driven and those parts break down, then not only are the passengers of that vehicle in possible danger, but everyone else on the road too.”

Original Article (and more): https://www.nbc12.com/2019/04/25/digital-rollbacks-millions-cars-have-false-mileage-odometers/

Odometer fraud on the rise in Austin and costing car buyers thousands of dollars

Used car buyers in Austin are getting ripped off in record numbers. Con artists are rolling back the mileage on odometers to make the vehicles seem more valuable. The fraud is costing victims an average of $4,000 each.

Kristin Young thinks she was duped. She and her husband bought a used car believing it had low miles. Instead, they discovered the odometer was rolled back about 67,000 miles to make the car seem more valuable.

“$5,000 invested and it’s probably worth about $1,500,” said Kristin.

“For us that’s a lot of money and a lot of sacrifice,” said Ferron Young.

Carfax data suggests that 1.5 million vehicles on the road have had their odometers rolled back. 10-percent of them are in the state of Texas. “It is getting worse. It is growing every year,” said Chris Basso, a used car expert with Carfax.

Basso setup a demonstration to show how easy it is to put any number you want on a digital odometer. “We’ve got a truck that has 230,000 miles on it right now,” said Basso.

That would make the truck’s value around $3,600.

But in less than one minute the odometer was rolled back to 130,000 miles. “And there you go it’s done already. 100,000 miles taken off the odometer,” said Basso. “Somebody can now charge more than double what this car is actually worth.”

CBS Austin asked for a second demonstration using our own numbers.

“We’re going to plug that in right now,” said Basso.

And in 54 seconds the odometer was rolled back from 130,000 miles to 86,000. “And that’s the scary thing, isn’t it? You’re essentially hacking the car’s computer just by plugging it into the device that we have. Those things are available through internet searches that conmen are using to rip people off,” said Basso.

CBS Austin did an internet search and quickly found legal devices that are illegally being used to make cars seem more valuable. Many come from China and sell online for less than $300. CBS Austin also found YouTube videos with step-by-step instructions on how to change the mileage on digital odometers.

“It’s hard because it’s only a Class B Misdemeanor,” said Robert Foster, lead investigator for the Texas DMV Compliance and Investigation Division.

The fraud investigator says in Texas the punishment for odometer tampering does not fit the crime. “It’s just a little bit worse than getting a speeding ticket,” said Foster.

Which may explain why Austin and other Texas cities have so many cars on the road with rolled back odometers. According to Carfax, Austin’s odometer tampering cases jumped by 12-percent in 2018. That’s twice the national average of six-percent. Statewide, the number of vehicles with rolled back odometers went up in 2018 by 9.7 percent.

“Odometer fraud is very hard to detect,” said John Adams, owner of Auto P. I. Used Car Pre-Purchase Inspections. “If it’s done by a professional, they can do it in just a few minutes and no one is going to be able to tell.”

Adams said older vehicles can be a challenge. “This vehicle has170,000 miles on it,” said Adams as he walked around a 2008 Honda Fit.

The compact car has faded paint, a cloudy headlight and a banged-up bumper, but Adams says it would be easy for a con artist to pass it off as having 50,000 fewer miles. It’s fraud that would have a buyer overpaying by a significant amount. “$1,000 to $1,500,” said Adams.

The Youngs didn’t figure out they overpaid by $3,500 until they did a free Carfax odometer check.

“Financially it was a huge, huge problem. It took a lot to recover from,” said Kristin.

She and her husband will never buy another used car without getting a vehicle history report and having a mechanic do a pre-purchase inspection. Their advice to consumers is to do your homework because buying a used car should not mean you’ll be taken for a ride.

The National Highway Traffic Safety Administration (NHTSA) has the following tips to help used car buyers detect odometer fraud.

Request a vehicle history report or use the car’s VIN to order one online.
Compare the mileage on the odometer with the mileage indicated on state inspection reports and vehicle maintenance records.
Ask to see the title and compare the mileage on it with the vehicle’s odometer.
Look at the wear and tear on the vehicle, especially the gas, brake and clutch pedals, to be sure it’s consistent with the number of miles on the odometer.
If you suspect fraud contact the NHTSA’s Vehicle Safety Hotline at 1-888-327-4236.

Original Article: https://cbsaustin.com/news/local/odometer-fraud-on-the-rise-in-austin-and-costing-car-buyers-thousands-of-dollars

Odometer fraud and how to avoid it

Even with the dawn on the digital odometer, used car buyers should be aware of odometer fraud. That’s the warning from Carfax.

“In fact these digital odometers can be easier to rollback because A) we’re not looking for it and B), there’s widespread availability of tools that simply plug into the car’s computer and essentially hacking it,” said Chris Basso of Carfax.

Basso suggests checking with a site like Carfax or having an auto mechanic check out the car you’re considering before you purchase.

For the full demonstration of how a digital odometer can be rolled back, see the video player above.

Original Article: https://www.kbtx.com/content/news/Odometer-fraud-and-how-to-avoid-it-504991461.html

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