When an insurance company declares a vehicle in Texas a total loss, the state issues a branded title — one that is forever linked to the vehicle identification number, or VIN.
That can reduce, but not eliminate, the odds of someone in Texas unknowingly buying a car or truck ruined in the Houston flood.
But, as Frank Scafidi with the National Insurance Crime Bureau explains, crooks are more likely to send those cars out of Texas in a process called “title washing.”
"Somebody might pick that vehicle up really cheap, transport it to another state where they don't require a physical inspection, or where they don't carry a brand (on the title) from one state to another, and they get a new title," Scafidi says.
And the crooks don’t stop there.
"Some of these characters will take that ‘clean title’ and they'll go to another state, and wash it again. So now it's twice-removed from the state of incident," Scafidi says. "And you can waltz back into just anyplace and sell that vehicle."
Texas uses a national vehicle database it to double-check VINs before issuing a new title. But not every state provides information. That means flood-damaged vehicles from other parts of the country can end up here.
Scafidi says scammers have the ability to wash a car's title before the chain of events shows up on the popular car history reporting sites — making a mechanical inspection before buying a used car even more important.
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