Certified Pre-Owned Car Fraud Is on the Rise

Certified Pre-Owned Car Fraud

It is not a secret that Certified Pre-Owned Car Fraud Is on the Rise. Consumers paying extra to purchase a certified pre-owned car suppose that it can bring them peace of mind. But they are probably mistaken. The number of cases involving certified used vehicles previously wrecked or with other substantial defects has sharply increased. Unsuspecting customers might get taken advantage of original warranty protection as certified pre-owned cars are supposed to be thoroughly inspected. This is to ensure that the vehicle meets high manufacturer standards. These cars command higher prices and bring extra profits as compared with their uncertified counterparts.

Independent auto experts state that not all the dealers conduct the detailed examination of pre-owned vehicles. A large number of certified cars have clear signs of previous wreck and undergone bodywork. For example, unresolved structural problems, over spray, etc. Many of them are unsafe to drive.

What are the benefits of a certified pre-owned car?

A used vehicle becomes certified when being refurbished and inspected by a dealer or manufacturer. Manufacturers can also suggest you nothing for the purchase of CPO vehicle except a service agreement. Service contract is to protect car owners against unexpected, expensive repairs to their car. The service agreement company covers the costs associated with car repair after a manufacturer’s warranty expires. However, there is a significant difference between extended warranty and service contract. If a consumer has problem with the vehicle covered by warranty, he may be entitled to lemon law buyback under the lemon law. If a service agreement  covers the problem, customer may have the defective part repaired or replaced.

Vehicles, which cannot be sold as certified

Under the law in Vehicle Code Section 11713.18 the sale of the following vehicles cannot be sold as certified:

  •  with unknown or altered odometer.
  •  reacquired by the automaker in compliance with federal or state warranty law.
  •  branded as “salvage”, “lemon law buyback”, “manufacturer`s repurchase”, “flood”, “junk” or similar notations.
  •  with frame damage.
  •  sold “as is”.

An auto dealer must disclose material facts related to the vehicle’s history even if a customer doesn’t ask him. If a dealer fails to do it hiding important facts about car repairs, previous accidents and damages, its “rental” status, it’s a misrepresentation. In case if the dealer conceals these facts responding to your direct question (e.g. Was the car involved in a collision before?) you may sue a dealership. If you have bought CPO car with a warranty and it experiences defects covered under manufacturer’s warranty, you can be protected under the California Lemon Law statute.

The California Lemon Law and dealer fraud attorney The Margarian Law Firm is ready to help you with your claim. You may reach us at 818-553-1000.

Protect yourself from car dealer fraud following our used vehicle buying guide:

  • Don’t think that certification is a guarantee that the car has not suffered serious damages in collision, has not been flooded or wrecked.
  • Thoroughly inspect the vehicle title. “Junk”, “Flood”, “Rebuilt”, “Lemon law buyback” or similar terms are dangerous signs of the troubled past of the car. If the dealer puts obstacles in your way, take a pass on that car.
  • Take the vehicle to a body shop or a mechanic for inspection. A dealer is entitled to allow you to do this. Otherwise, you must turn down the idea of buying CPO at that dealership.
  • Run a vehicle report from AutoCheck or Carfax and check a car VIN at the National Insurance Crime Bureau website.