“Title washing” is an emerging form of fraud that allows car owners to take advantage of unwitting car buyers by concealing information on the car’s title. It is principally done in one of two ways. Frequently the perpetrators take advantage of varying vehicle documentation laws among different states to hide flood-damaged and salvaged title labels on the car’s title. Scammers are also able to dupe victims is by filing fraudulent paperwork with the state to obtain a duplicate title that does not show the valid lien attached to a vehicle.
Insurance companies brand a vehicle as “salvaged” when the automobile has suffered a total loss due to a wreck, flooding or other damage where repairs are equal to or greater than the vehicle’s value. Owners and dealers use title washing to wipe away the title’s tainted past, which makes it easier for them to sell vehicles faster and at a higher price.
Like the removal of the salvaged tag, title washers who conceal liens are hiding information to recover more money. Unfortunately, these scammers are able to make thousands and the victim pays the price. A lien on a vehicle stays with the car so even if a buyer believes they purchased a car free and clear, it may not be. People may not even realize they’ve become victims of fraud until their car is repossessed.
Protecting Against Fraud
The first step in combating title-washing is to use a service like CarFax or AutoCheck to check VIN reports. Even though a state’s records may contain errors due to this fraud, these sites will contain the true history of these vehicles. Scammers cannot change these reports with falsified paperwork.
Vehicle Documentation Alteration
Companies that perform lien washing are popping up across the country. Specifically, so-called “repo-busters,” under the guise of a legitimate business, are filing false paperwork and altered documents. In one case reported in North Carolina, the instigator claimed that by altering the vehicle’s documents he could help the victim with relief from overwhelming car payments or the threat of repossession.
Prosecution Efforts Increasing
State and federal agencies are ramping up their efforts to capture title washers. In September, a Dallas-area car dealer was found guilty of washing over 600 titles with 5 other men. In February, the California Attorney General’s Office charged a Los Angeles man with conspiracy, auto theft, forgery and filing a forged instrument after exposing the fraud as part of a car theft ring.
The penalties for a conviction of title washing are severe. If you are being accused of title washing or any other form of fraud, it is important you speak with a fraud defense attorney right away. An experienced Riverside criminal defense lawyer can review the evidence against you and discuss your options.