Car Fraud: Title Washing

According to the official data of the California Police, they register more than 500,000 vehicle accident reports each year. The half of the vehicles involved in these accidents is considered “totaled”, which means they are deemed a total loss by insurance companies. The vehicle that is approximately 75% damaged and can’t be fixed up is known as a “totaled” vehicle. When the vehicle is declared to be “totaled”, the title of the totaled vehicle is submitted to the Department of Motor Vehicles and then the DMV issues what is called a “Salvage Title.”

However, the other half of the vehicles are put back together and sold to used car buyers. This is how the title washing car fraud occurs. In most cases what really happens is the seller or the car dealer hides the history of a vehicle that has been salvaged.

It should be noted that it is not illegal for anyone to fix and re-sell a vehicle with a salvage title. However , it is very hard to sell these vehicles, because when the buyer find out that the vehicle he/she intends to buy has a salvage title he/she changes his/her mind. On the other hand the vehicles branded with salvage titles have lower market values. This is why many car sellers hide the fact that the vehicle is totaled or simply “wash” their titles.