Car Identity Theft

By: Lindsay Puccio
By: Lindsay Puccio

March 29, 2006

It's a new form of car theft that involving vehicle identification numbers. It costs the insurance industry more than $4 billion a year, which means higher insurance rates for drivers.

Used car buyers beware. The vehicle identification number could be a fake. Thieves are changing VIN numbers to hide the fact that the car was stolen.

Insurance agent, Kimberly Wilcher, said she sold motorcycle insurance to a man who tried to scam the insurance company.

"Apparently he reported it stolen, sawed down the VIN number and then had another plate put over it. He sold it and then collected on the insurance money," said Kimberly Wilcher, of Risk Insurance of Virginia.

The thief was eventually caught, but stories like this are all too common. In 2004, over 200,000 cars were reported with duplicate VIN numbers.

What they're doing is copying the VIN number off a legitimate car and putting it on a stolen car of a similar make and model. Then they re-register the car, hiding its history from unsuspecting buyers. If you end up buying that stolen car, you could be out of luck.

"As the owner of the car, you’re responsible. So you just bought a stolen car, which could be repossessed [and] probably will be," said Dee Leekha, of Allstate Insurance.

Not only is it unfortunate for the owner but it affects the rest of us, too. We all end up paying through higher insurance rates.

"When the insurance companies pay out they're going to take it back to the consumer every time. They need to make their premiums, their money," said Wilcher.

To avoid buying a used car with a stolen VIN number, check the history of the title. If it's been registered several times in non-connecting states, that could be a red flag.

There are also websites online that will trace the VIN number for you.

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