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Incidence Rate of Odometer Fraud: Preliminary Report
Christina Morgan. Estimates the probability of an odometer rollback (i.e., odometer readings on 2 separate occasions, & the later reading has the lower mileage) during the first 11 years of a passenger vehicle’s life to the extent it can be detected in title transfer data. The rate of odometer fraud is 3.5%. That is, a 3.5% chance that a vehicle would have its odometer rolled back at any point during the first 11 years of its life. There are approx. 452,000 cases of odometer fraud per year in the U.S. The difference between the inflated prices that consumers actually paid for the rolled-back vehicles & the prices they would have been willing to pay if they had known the true mileages average $2,336/case, or $1 billion/year.
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