G1 G1 Databases for Vehicle History, TSBs, and Recalls What They Have and How to Use Them John Van Alst
Databases for Vehicle History, Technical Service Bulletins, and Recalls - What They Have and How to Use Them John W. Van Alst Consumer Rights Litigation Conference Friday November 8, 2013 Session G1 1:10-2:10 Auto databases are a double edged sword in consumer protection. 1 Ideally they protect consumers by providing information about a vehicle s history prior to purchase and aid consumer attorneys by revealing when and how a car has been damaged and who knew of the damage. Unfortunately, all too often, the reports from databases are used to persuade purchasers that a damaged vehicle has a clean history, or to provide cover to unscrupulous dealers selling such cars that due to a clean report they had no reason to know of the damage. However, there are important changes taking place in the area of databases that practitioners should be aware of, and that hopefully may make these databases a better tool for both consumers and their advocates. The recent implementation of the long awaited National Motor Vehicle Title Information System (NMVTIS) will provide an alternative database, and may spark changes in existing databases or make available information previously not accessible by the public. NMVTIS Much of the recent change and hope for future improvements is precipitated by the implementation earlier this year of the long awaited National Motor Vehicle Title Information System (NMVTIS). The NMVTIS is an important new vehicle information database, particularly concerning a vehicle s salvage or insurance total-loss history. The legislation creating NMVTIS was enacted in 1992. The Anti-Car Theft Improvements Act of 1996 mandated that a system be in place by December 31, 1997. 2 But limited progress was made until a 2008 court order required the Department of Justice to proceed. The Department of Justice issued regulations on January 30, 2009, 3 and the database is now operational. The regulations require all state motor vehicle departments to provide titling information to the NMVTIS database. This information must be provided electronically, at least once every twenty-four hours, although some states are 1 For more information about auto databases and investigatory techniques see National Consumer Law Center, Automobile Fraud Chapter 2 (4th ed. 2011 and Supp.) 2 49 U.S.C. 30502. 3 26 C.F.R. pt. 25; 74 Fed. Reg. 5740 (Jan. 30, 2009).
moving towards real time updates. As of April 2013, thirty-four states provide data and inquire into the system before issuing new titles, eight states provide data to the system but do not make inquiries before issuing new titles, and nine states are in development. As of March 31, 2009, all insurance carriers were required to begin reporting monthly to NMVTIS all junk or salvage vehicles they have obtained in the past month that are from the current model year or any of the four prior model years, if the insurer has declared the vehicle to be a total loss. 4 Also as of March 31, 2009, all auto recyclers, salvage yards, and junk yards were required to begin reporting monthly to NMVTIS all junk or salvage vehicles they obtained during the past month. 5 The NMVTIS regulations require NMVTIS to provide users with information as to the status and validity of any document purporting to be a certificate of title, in which state a vehicle with a known vehicle identification number (VIN) is titled, whether the vehicle has been labeled junk or salvage, and odometer reading information. A NMVTIS search will include the vehicle s brand history. Once a vehicle is branded by a state motor vehicle titling agency, that brand becomes a permanent part of the vehicle s NMVTIS record. Thus the brand will be reported even if a title brand is washed (that is, removed) from the title, such as when the vehicle is retitled in another state and that state does not recognize the prior state s brand. A NMVTIS search also includes the latest reported odometer readings, and any determination that the vehicle is salvage by an insurance company or a self-insuring organization (including those vehicles determined to be a total loss ), and any reports of the vehicle being transferred or sold to an auto recycler, junk yard, or salvage yard. There may be different standards as to whether a state brands a title, an insurance company records a vehicle as a total loss, or whether a vehicle is sold to a recycler, junkyard or salvage yard, so a vehicle may show up as a problem from one source but not from others. For example, insurance companies often label as a total loss a stolen vehicle not recovered within thirty days. If the vehicle is later recovered in perfect condition, the total loss determination is not removed even though the vehicle will have no salvage brand. Moreover, because NMVTIS data is incomplete, especially in regards to older cars that have not been damaged or transferred since the system became operational, a vehicle with a clean report may still have a problem history. Title records will continue to have more information 4 26 C.F.R. 25.55(a). 5 26 C.F.R. 25.56(a).
than is available through NMVTIS, so this system does not replace a thorough title search, but it is a good first step. NMVTIS reports are not available from the government, but only from an approved provider, listed at www.vehiclehistory.gov. Presently there are ten providers. Prices vary depending on the provider and the type of report. Reports include the current and all past states where the vehicle has been titled, with issue dates and odometer readings. Also included is junk and salvage data, with the name and contact information of the reporting entity (an insurance company, a recycler, a junk yard, or a salvage yard), dates, and disposition of the junk or salvage vehicle. Each brand ever listed on a title is provided with the brand code, the branding entity, and date the brand was applied. CarFax and AutoCheck The two largest privately owned databases that are sold to both the public and dealers are CarFax and AutoCheck. Both buy information from various different entities including state motor vehicle departments, some police departments, and other sources. There are some differences between the databases. In particular, Autocheck, owned by the credit reporting company Experian, has information regarding damage that is announced when vehicles are sold at the two largest auto auctions, Manheim and Adesa. Despite some differences, the failings of both CarFax and AutoCheck are the same. Both databases are incomplete as they both rely upon information sources that are willing to sell the information to these databases. The information that is reported often is either not reported or incorporated into the report in a timely manner. This means that both reports often suffer from false negatives giving consumers a false sense of security when buying a car. The resulting clean report for a damaged vehicle is used dealers in an effort to sell the damaged vehicle. Often if the information does make it onto the report it will be after the sale and the consumer will then be caught with a vehicle with greatly diminished value. CarFax reports may be obtained online at http://www.carfax.com/. AutoCheck reports can be obtained from http://www.autocheck.com. Of course for information beyond the report provided to the public, such as the date and entry was added to a report, it may be necessary to subpoena either database, although some attorneys do report success in obtaining such information with subpoena by simply politely asking for it.
Insurance Services Office and CLUE Some privately created auto databases are not publicly available. The Insurance Services Office (ISO) compiles insurance claims information for cars on their A-PLUS database. The database is used to provide insurance providers and others with prior claim information on a particular vehicle or insurance consumer. The information includes not just total loss information but a much wider array of claims such as glass, towing and labor, and rental reimbursement. While this database includes information from over 90% of the United States by private vehicle volume, it often lacks information from corporations that self insure their vehicles such as many fleet owners. Another insurance claims database is the CLUE database compiled by ChoicePoint, a subsidiary of LexisNexis. It too compiles claims information from the insurance industry. Lexis representatives claim that "more than 98% of insurers writing automobile and homeowners coverage provide loss data to the CLUE databases." 6 The information on both of these databases is used by insurers to set rates on new policies and to verify that they are not authorizing payment on a claim that has already been paid by another carrier or for damage resulting from another claim. Insurance companies can access data from the database if they also contribute claims information. Consumers can access some information found on their own ISO A-PLUS report or CLUE report under the FACTA amendment to the Fair Credit Reporting Act as these are consumer reporting agencies under the act. The CLUE information may be accessed by requesting a Full File Disclosure from ChoicePoint at http://www.choicetrust.com. The Full File includes CLUE information and all other information ChoicePoint has compiled for various reports it sells such as criminal records, pre-employment screening, and others. ISO personal claims data can be obtained by submitting a signed request form. A copy of the form can be obtained by calling 1-800-709-8842. While obtaining such reports may be useful, unfortunately the information obtained is limited to information associated with that individual consumer, not prior claims information about a particular vehicle the consumer may purchase or has purchased. Some attorneys have reported attempting to obtain or obtaining this sort of information through friendly insurance agents, but it is doubtful such an attempt can or should work. Agents request would be for the same information 6 Mark Terry, Claims that boost your insurance rates, Bankrate.com, quoting Fiona McCaul of LexisNexis Risk Solutions, article available at: http://www.bankrate.com/finance/insurance/claims-that-boost-your-insurance-rates- 1.aspx.
described in the consumer report available above- information about the consumer s history, not the vehicle. Also, such a request would not be within the permissible purpose of an agent s request which is limited to obtaining information in connection with underwriting insurance. Vehicle level information will likely only be available through the use of a subpoena. Other private databases of vehicle information are maintained by manufactures. These databases contain records of repairs under warranty, resolution of lemon vehicle problems and records of consumer complaints. These databases are generally partially or entirely available to franchise dealerships. The manufacturers have a record of failing to disclose in discovery information found on these databases. National Insurance Crime Bureau The National Insurance Crime Bureau (NICB) compiles information primarily from insurance companies into an auto database to combat insurance crime. NICB makes some types of information available to the public: vehicles reported as stolen or salvage and flood damage vehicles. This information is available on NICB s Vincheck report. Up to 5 such reports may be obtained for free within any twenty-four hour period on the NICB website at: https://www.nicb.org/cps/rde/xchg/nicb/hs.xsl/vincheck.html. Any information not on the report could only be obtained through subpoena. Title Search Additional information about a vehicle can be obtained through a detailed title search. This involves requesting title history information from each state where the vehicle has previously been titled. Such a search can reveal not for use owners such as dealers and others that may not be found on title history summaries on the above databases. Also the original titling documents available from such a search may be useful in discovering or proving fraud or forgery in the titling of the car. A detailed title search may be done by the consumer s attorney or by hiring a commercial service. 7 TSBs It is required by statute 8 to make technical service bulletins (TSBs) available to the public in searchable form on its website. 9 The same website allows searches for safety recalls, defect investigations, and complaints. 7 For more information about how to conduct a detailed title search see National Consumer Law Center, Automobile Fraud 2.4 (3d ed. 2007) 8 @843@ 49 U.S.C. 30166(f).
Recalls In 2012 the Moving Ahead for Progress in the 21st Century (MAP-21) Act was passed, directing the Secretary of Transportation, within one year of enactment, to require that manufacturers provide motor vehicle safety recall information to the public on the Internet. 10 The information must be searchable by vehicle make and model and vehicle identification number, in a format that preserves consumer privacy, and must include information about each recall that has not been completed for each vehicle. The Department of Transportation has proposed to meet the MAP-21 requirements through improvements to its existing recall search tool found on its website, www.safercar.gov. This system will provide a vehicle information number (VIN) search that will report whether a vehicle has been subject to a safety recall and, if so, whether the manufacturer s free repair or other remedy has been performed. 11 The proposal would require larger volume, light vehicle manufacturers to provide NHTSA with the VINs for vehicles subject to safety recalls, and with remedy completion information on those vehicles, updated at least once daily. Additional information would also be provided by the manufacturers, including identification and description of the risk associated with the safety defect and, as to motor vehicle equipment recalls, the brand name, model name, and model number of the equipment recalled. 9 The website is found at http://www-odi.nhtsa.dot.gov/tsbs/tsbsearch.cfm. See also 14.5.7, supra (discussing requirements for creation of a database, searchable by vehicle identification number, of vehicles subject to safety recalls; the database must also report whether the manufacturer s free repair or other remedy has been performed on the vehicle). 10 Pub. L. No. 112-141, 31301, 126 Stat. 405, 763 (2012) 11 77 Fed. Reg. 55,605 (Sept. 10, 2012).