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Odometer Fraud and Tampering

LexArtis

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Jun 17, 2015
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I have posted before with the name of the business and believe the thread was taken down for that.

anyways,
i think this topic deserves much more exposure as many of us are victims with knowing it.

I bought a "2006 Caterpillar D5G XL Dozer" with 5000 hours on the machine and a new motor as they claimed from a seller in Oklahoma.

I asked about any previous damages and was told:" Absolutely not! We wouldn't offer anything like that here. We've been doing this for many years and would never be able to do this by selling junk!".

I was in for a ride...

The machine was delivered May 22 and had a first chance to work with it June 7.
The next day I came across an auction site listing that sold that machine in Nov of 2014 with the same serial number and matching photos/visuals as a 2003 piece of equipment with 9095 hours on it and not as the seller claimed a 2006 dozer with 5000 hours. Furthermore the hour meter was tampered with and exchanged for one with less hours.
I contacted the auction site and was told that the seller was the one who bought it from them.

I reached out to him and asked for my money back - without response.

Contrary to popular belief odometer fraud in heavy equipment is a federal felony according to Title 15, U.S.C. to Title 49 of the federal odometer tampering statutes and carries a prison sentence from 18 month to 7 years without parole.

I have contacted since the local police, the attorney Generals offices of NY and Oklahoma, the FBI, the BBB of Oklahoma, the Federal Trade Commission, the Department of Consumer Credit, the Odometer Fraud Department in DC, local newspapers in Oklahoma, the New York Times, Washington Post and Huffington Post and left reviews with Google and Yelp for the seller and everyone to see...

any advice and experience is welcome.
 

lumberjack

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Sounds like you should talk to an attorney.

I had an issue last year with a grapple truck not being as advertised last year when the seller delivered it. I never accepted the truck/took possession of it. They drug their feet until we filed suit in federal court, then they settled quickly paying the initial purchase price, legal fees, and a pinch more. They ended up paying a fair bit more to 3rd parties for the attempted repairs they executed locally, as well as storage fees.

I had a copy of their ad from a couple different websites, a DOT inspection of the truck and trailer by a third party (failed for several reasons), and a mechanic's report as my "proof."
 

digger242j

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I have posted before with the name of the business and believe the thread was taken down for that.

Correct. Though there's plenty of it to be found on the internet, HEF isn't the place to air personal or business disputes. Discussing the situation in general terms, as is being done now, is acceptable.



Contrary to popular belief odometer fraud in heavy equipment is a federal felony according to Title 15,

U.S.C. to Title 49 of the federal odometer tampering statutes and carries a prison sentence from 18 month to 7 years without parole.

While it's undoubtedly dishonest, and I don't know if there's some other law that covers it, I don't think the law you're citing applies. Under that federal law, (and I'm no lawyer, but I can Google with the best of em), a dozer is not a "motor vehicle", and an hour meter is not an "odometer".

(7) “motor vehicle” means a vehicle driven or drawn by mechanical power and manufactured primarily for use on public streets, roads, and highways, but does not include a vehicle operated only on a rail line.

(https://www.law.cornell.edu/uscode/text/49/32101)

(5) “odometer” means an instrument or system of components for measuring and recording the distance a motor vehicle is driven, but does not include an auxiliary instrument or system of components designed to be reset by the operator of the vehicle to record mileage of a trip.

(https://www.law.cornell.edu/uscode/text/49/32702)

I wish you luck, but I'm not optimistic.
 
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Axle

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About all you can use is previous ads provided they can be clearly identified as your machine, and hope that bends a sympathetic ear. As stated, an hour meter is not an odometer by any stretch of the imagination--no way to measure distance travelled.

Alex.
 
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LexArtis

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Jun 17, 2015
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Location
New York
joispoi- any correstonding via USPS? No, why? He has not responded to any email from me or my attorney.

I do have a lawyer involved.
He is very certain that it is a criminal case. And even if it isn't. it's certainly a civil case and I will pursue going after him for additional costs and damages...
I will keep you guys posted.
 

JDOFMEMI

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Keep in mind that the "hour meter" you mention is not even called that by the manufacturer. It is called a service unit meter or something near it, and is described as to be used for calculating service intervals for the machine, and not to be used as an official measurement tool.

In general, laws regarding automobiles are consumer laws, and they generally do not apply to commercial equipment.

It is best to do your research and due diligence on a machine BEFORE you lay out the money to buy it, not after. I am not trying to be judgmental, but trying to help others who come across this.

Also, once equipment is nearly 10 years old, its value has much more to do with its actual operating condition, and less to do with the age or hours.

As with most business dealings, keep in mind "Buyer Beware"

That said, good luck with your battle.
 

digger242j

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joispoi- any correstonding via USPS? No, why?

Because using the US Mail to cheat somebody has its own set of laws, and in that case the Postal Police might be someplace to look for help.
 

LexArtis

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New York
I will wait now for the federal agencies to respond and will take it from there.
I did not send anything by US mail.

I have bought many things before and agree to the buyers aware principal.
But you can't buy something that is a 2003 piece of equipment with 9095 hours and turn around and advertise it to be a 2006 with half the hours.
There is/should be a limit. That's why we have consumer protection agencies.
Lets see where this goes.

Does anyone know of any court cases?
 

Nige

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As others have said I think you are on to a loser on the odometer/hour meter issue. The Laws that apply to motor vehicles and mileage most likely (and I say that advisedly because I am not an expert) do not apply to equipment and hours worked, and any good lawyer should be able to mount a robust defence if that is the case. The reason being that the hour meter or service meter as it is more commonly known is designed to be replaced with a new onne in the event of failure (which does happen) and the installed replacement would read zero if it was new or some other value if it was 2nd hand. Normally the maintenance records would contain something like "hour meter replaced at X operating hours". Stickers are available to put on the hour meter to show the hours on the previous failed meter. Add the two together and you have the total hours on the machine. AFAIK there is no law making it illegal to tamper with an hour meter like there is for a vehicle odometer.

IMHO you want to be chasing them for misrepresentation of a 2003 machine as a 2006 model in the sale where you bought it - and by implication the machine would have worked more hours being 3 years older at the time of sale to you. That ought to be quite simple to prove. The Serial Number can be tied to an exact date when it left the factory, no ifs, ands, or buts. However the waters then get murky as the auctioneers will most likely say that they put it in their sale catalogue on the basis of how the seller described it, so you would need to seek legal advice in deciding whether the auction house or the seller (or both) should be the defendant in this case.

I would also suspect that unless you can come up with some concrete proof you will be fighting a civil rather than criminal case, and the only people likely to come out as winners in that one are the lawyers.
 
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oceanobob

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As to the year of the machine - was wondering why some folks cite the year and others cite a range of years....when I inquired about this with a gent from a local dealer, he offered the following comment: The machine model can run off the line for a couple years or three or whatever without change therefore if one had the original purchase date from the dealer, the machine could have been on the production line quite a while back and there are various legitimate reasons for such a delay in the sale like the economy, regional machine preferences, blah blah...

***************

Exact year didn't amount to much for me as I based my decision on other factors knowing I was buying "used iron" but wondered what would happen to me if'n I sold the machine and the new buyer was steamed when there was some difference in the expectation about the item. Not that anyone cared about my feelings LOL.

Added as a additional information to the thread: I wonder if this 'year thing' has an adverse effect on the original financing. Prolly read better on the equipment sale documents if the dealer simply lets it appear to be new based upon sale date as opposed to trying to explain it is new as far as operation, but it was made (for example) "two and half years ago just set here for folks to look at"....and then what happens to those 'test hours' or 'demonstration hours' ???.....

I can see how these small details can later become bigger details.
 

Nige

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As to the year of the machine - was wondering why some folks cite the year and others cite a range of years....when I inquired about this with a gent from a local dealer, he offered the following comment: The machine model can run off the line for a couple years or three or whatever without change therefore if one had the original purchase date from the dealer, the machine could have been on the production line quite a while back and there are various legitimate reasons for such a delay in the sale like the economy, regional machine preferences, blah blah....
The machine to which the OP's question relates was manufactured by Cat and given the exact Serial Number the date of dispatch from the factory production line is freely available to those who have access to the Cat system. For me a machine dates from the date it was first shipped from the factory, not the date when was first sold. In fact many machines are only assembled on the basis of a firm order from a dealer to the manufacturer, therefore the assumption is that the machine is shipped directly from the production to the dealer for the customer to collect or even direct to the customer in the case of larger machinery.


Added as a additional information to the thread: I wonder if this 'year thing' has an adverse effect on the original financing. Prolly read better on the equipment sale documents if the dealer simply lets it appear to be new based upon sale date as opposed to trying to explain it is new as far as operation, but it was made (for example) "two and half years ago just set here for folks to look at"....and then what happens to those 'test hours' or 'demonstration hours' ???.....
It's quite usual for dealers to sell off demonstration or ex-rental machines. Such machines would in my experience be sold as used and their "model year" would be the year they were manufactured not the year they were sold.
 

John C.

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Cat is one of the few that post actual manufacture dates and you can bank on that. Since that information is easily available the argument can be made that the buyer was on the hook for confirming that information. I know of at least one manufacturer that has the dealer stamp the serial number on the machine at time of first sale.

The second point is that fraud isn't a crime unless there is a loss of some kind. What can be proved in this case. If the machine is operational and in a condition that could be considered consistent with a range of hours, then what is the loss? One might claim that the loss is the difference in what would be paid for the older machine and a newer machine. Don't know what was paid but proof would require an expert with credentials to provide expert testimony to a court of law. The problem for the buyer would come if there was little difference. If the price paid for the machine was a bargain considering the advertised specifications, then the buyer gets saddled with what is known as the "benefit of the bargain".

Next problem comes from which state will have legal jurisdiction. Is it the state where the machine was at time of sale or the place of delivery? Chances are the sales contract will have a jurisdiction clause stating where and how disputes will be resolved. Most of the contracts I've seen require arbitration before any lawsuit cab be filed. It sounds like the sale took place across state lines so there be a violation of interstate commerce which might be a federal issue.

Now I'm not saying the seller wasn't dishonest. What is described is generally termed false advertising and appears to be easy to prove. That may be a crime. It is certainly grounds for a civil suit. I am absolutely sure that any attorney will state this is an open and shut case before a retainer fee is posted to their bank account. I'm also sure that after thousands of dollars in fees are paid and tons of people's time is consumed, the results may be far less open and shut as was described. Then on the other hand the seller could close up shop and melt back into the swamps only to show up in another state under a new name in two of three months doing the same thing.

Please keep us up to date.
 

LexArtis

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thanks for all the input.
I have pretty solid pictures of the sellers website as well as tons from the auction site. with close ups and everything. also video.
I have plenty of emails from the seller.
basically what it comes down to is whether its a criminal case or not. the attorney general should be able to decide that. the shipping was done by the seller and my company's place of business is new york so it seems that jurisdiction is in NY. we will see.
odometer fraud is def a crime but whether meter fraud is might be arguable.
it's definitely a civil case hence he advertised it to be a 2006 with 5000h and its not.
the contract i had with the seller was for a 2006 with 5000h and not a 2003 with at least 9095 hours. this is considered "breach of contract".
I am a very patient man and will pursue this out of principle.

it seems to be a reputable business and his dad i guess started it some 45 years ago.
the neg reviews and feedback he received as well what's coming from the bbb and other agencies will/should hurt him and get him thinking.
he seems to be doing quite of lot of sales and if i was in his position i would simply take the unit back and cut a loss. we are talking $5K-10K as a loss if he would pay me what i am asking and pick this unit up.
 

Randy88

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Before I'd file suit or even threaten that route, I'd maybe take all the paperwork to an attorney and have him decipher it for you, curious as to any phrases in there that stated it was up to the buyer to verify the accuracy of the hours, age and condition and by signing the paperwork and buying the machine you wavered your rights and absolved the sellers statements or advertising. There's usually some clause that puts the liability to verify the accuracy and inspection of the machine up to the buyer and once payment is made, its as is where is and no claim or lawsuit can take place for fraud or misrepresentation or something to that affect but I'm not a lawyer either.

Most business's know the law in their state, how close they can step up to the line of breaking that law without going over it and actually break the law. I'm not thinking your going to achieve what you want or think your entitled to, but I hope you keep us posted.

Also curious as to why none of the agencies you contacted have yet to get back to you with a result, most times when a business has actually stepped over the line, in hours someone will get back to you from an authority agency, not days or weeks later, which tells me somewhere along the line you've overlooked something substantial on your part.

From everything you've typed so far, I'm with Nige on this one all the way, you might want something far more viable to bring to the table to tip the scales in your favor but best of luck on this ordeal for a good outcome on your part.
 

CM1995

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Before I'd file suit or even threaten that route, I'd maybe take all the paperwork to an attorney and have him decipher it for you, curious as to any phrases in there that stated it was up to the buyer to verify the accuracy of the hours, age and condition and by signing the paperwork and buying the machine you wavered your rights and absolved the sellers statements or advertising. There's usually some clause that puts the liability to verify the accuracy and inspection of the machine up to the buyer and once payment is made, its as is where is and no claim or lawsuit can take place for fraud or misrepresentation or something to that affect but I'm not a lawyer either.

I'm not a lawyer either and Randy has a good point. What does the contract say? If it has that sort of legal jargon, it doesn't bode well.

Now the machine does have an ECM that will tell the true tale if it's the original one. I would pull whatever information is on it.
 
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Nige

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Now the machine does have an ECM that will tell the true tale if it's the original one. I would pull whatever information is on it.
Good point. Unless the ECM has been replaced at some point the Diagnostic Clock in the ECM will show total machine hours. To get at this information will require the services of a laptop equipped with Cat ET software. Whoever does it should be requested to produce a "Product Status Report" from ET.
 

joispoi

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joispoi- any correstonding via USPS? No, why? He has not responded to any email from me or my attorney.

I do have a lawyer involved.
He is very certain that it is a criminal case. And even if it isn't. it's certainly a civil case and I will pursue going after him for additional costs and damages...
I will keep you guys posted.

If he had sent you anything by mail, you could have pursued him for mail fraud as well. It would have been enough to get the postal police involved (yes there is such a thing).
 

LexArtis

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Contract does not say anything.
I just have emails and the ad from his website.
Will look into ecu...
Nothing sent through the postal service.
 

CM1995

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Contract does not say anything.
I just have emails and the ad from his website.
Will look into ecu...
Nothing sent through the postal service.

Was there a sales contract or just a bill of sale? The sales contract or bill of sale and it's wording is important in what your trying to prove.
 
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