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Caveat emptor: flood-damaged cars may end up for sale

Caveat emptor: flood-damaged cars may end up for sale

Tools exist to help consumers determine if they're buying a 'flood car'
Caveat emptor: flood-damaged cars may end up for sale
Cars submerged from hurricane Harvey in Houston, Texas August 2017
Photographer: michelmond / Shutterstock.com

With storms come scams.

As Texas dries out from a monster hurricane and Florida braces for an even bigger storm, New York state officials issued a warning Friday about the time-worn, shady practice of refurbishing and selling flood-damaged cars and trucks to unsuspecting buyers.

As many as 1 million vehicles may have been damaged last month by Hurricane Harvey, officials estimated. That compares to 500,000 combined for hurricanes Katrina and Sandy.

“Extreme weather will continue to test our state, and although it brings out the best in New Yorkers, it unfortunately brings out the worst in scam artists who use a devastating situation to make a quick buck,” Gov. Andrew Cuomo said in an official statement.

DMV Executive Deputy Commissioner Terri Egan urged used-car shoppers to run checks on vehicle identification numbers for any cars or trucks they are interested in; the National Insurance Crime Bureau website offers an easy link to do this at nicb.org.

If a vehicle has been declared a total loss because of flooding (or theft or collision, for that matter) its VIN will indicate this.

The New York Independent Auto Dealers Association, which represents 6,000 auto dealers across the state, said standard practices in the modern used-car industry will detect flood-damaged cars being passed off as something else. Those practices include the CARFAX report, the mechanic’s short-arm examination and the certified pre-owned designation.

Any car or truck rebuilt after extensive damage from floodwater or other causes is called a salvage vehicle, and if it is being sold honestly, it will be flagged as such.

“Check the title; be sure it’s not a salvage title,” said Paula Frendel, executive director of NYIADA.

The chance for fraud by unscrupulous people does exist, she said.

“I’ve heard of things that occurred in New Jersey with Hurricane Sandy," she said.

Many ruined vehicles were treated honestly, also. One of the famous images in the Sandy aftermath was of 15,000 soggy vehicles sitting on a defunct Long Island airstrip, awaiting sale for parts or scrap.

There are periodic rumors of scammers driving car carriers full of refurbished flood-damaged vehicles thousands of miles from flood zones and selling them in popup lots that look like licensed auto dealerships.

That’s called curbstoning, and it happens more often on a smaller scale, with someone who doesn't have a dealership license selling one used car on his front lawn, then another, then another. 

It’s illegal in New York, and anyone who sees it happening -- one car at a time or by the dozens -- should call the local police agency, Frendel said.

That’s another good way to avoid flood-car scams, she added: Buy from a licensed dealer and check for any history of complaints against the dealer.

Egan at the DMV said caution and diligence are an important part of shopping for a used vehicle.

“If a deal sounds too good to be true, it probably is," she said. "If you are looking for a car, do your homework. Visiting our website to check the VIN is fast, easy and could save you cash and headaches down the road.”

The DMV notes that many of the protections afforded to people buying used vehicles from a licensed dealership do not apply to consumers buying from a private seller, and dealer regulations don’t apply to private sellers.

DMV does, however, require that buyers and private sellers of vehicles less than 9 years old complete an Odometer and Damage Disclosure Statement. It will not issue a new title without one.

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