Odometer fraud starts when the odometer on a vehicle is rolled back in order to make it look like that specific vehicle has less mileage on it than it actually does. This is because cars with less mileage on them will retain more value and usually sell for more money.
For clarification purposes, merely rolling back the odometer is not an offence in itself. But by adjusting the odometer to cut 30,000 to 40,000 kilometres off the actual mileage, unscrupulous sellers can inflate the price of the car by $2,500 to $4,000 higher. Therefore, odometer fraud will occur when the seller of a vehicle deceives the buyer about the true mileage of the vehicle.
Two types of odometers currently exist: the mechanical and the digital types. Historically, the mechanical odometers have been the easiest ones for criminals to tamper with. They find a way to disconnect the odometer from the car’s dashboard and then dial back the readings manually.
The digital odometers were rolled out later and were expected to make it a lot more difficult for criminals to manipulate. However, a lot of devious car sellers have still found methods to hack into these devices and roll back the digits.
Another noteworthy item to consider is that odometer fraud happens more often with relatively new vehicles that have accumulated a large amount of miles in a short period of time. These vehicles typically consist of cars belonging to a company fleet, as well as other rental or leased vehicles. As a matter of fact, it has been discovered that a large number of wholesale car dealers who buy and sell fleets of used vehicles commit odometer fraud.