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Hidden camera video shows it's hard for car buyers to uncover truth about vehicle’s history

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Posted at 6:00 AM, Feb 13, 2020
and last updated 2020-02-14 10:04:14-05

INDIANAPOLIS — A Call 6 Investigates hidden camera investigation reveals it can be difficult for Indiana consumers to get to the truth when buying a vehicle.

On a chilly winter day, two RTV6 employees went undercover at Auto Nerd’s Greenwood location and asked a salesman about the crash history of four vehicles — a Cadillac, a Volkswagen Rabbit, a Ford Focus, and a Volkswagen Passat.

Each time RTV6 asked, the salesman said the vehicle had not been in any crashes.

“Any of the cars here really haven’t been wrecked,” said the salesman. “We don’t buy stuff like that.”

What the salesman didn’t know is that Call 6 Investigates ran the vehicle identification numbers beforehand and Carfax reported all four vehicles had prior damage from crashes.

The Rabbit also had an open recal l— a problem with the vehicle’s antilock brake system that can cause the vehicle to lose control.

The car salesman didn’t seem to know anything about it.

RTV6: “Any recalls on this or anything?

Salesman: “Ah, nope.”

RTV6: “Do you guys check recalls and stuff before you put them out?"

Salesman: “Yep. Sure do.”

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Call 6 Investigates began looking into Auto Nerd’s business practices after receiving a complaint from Brian Murphy of Indianapolis.

“I was looking for a used truck that was reliable, nothing too fancy,” Murphy said.

Murphy bought a 2004 Chevy Colorado from Auto Nerd in Greenwood, and weeks later learned the vehicle was unsafe to drive.

He took it for a test drive and ran a Carfax report before buying the vehicle.

“It ran fine,” Murphy said. “When I talked to the dealer, he said he had been using it for errands and that it was a super reliable vehicle.”

Six weeks later, Murphy took his truck for an oil change.

"The technician came back to me and said they couldn't rotate the tires, because if they put it up on jacks the rear axle would fall right out of the truck and that the vehicle was completely unsafe to drive,” said Murphy. “I was pretty shocked and upset."

The underside of his truck was completely rusted out, said Murphy.

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Murphy took the vehicle to a collision place who confirmed the vehicle was unsafe to drive, and that it would cost nearly $8,000 to rebuild the frame — more than the vehicle is worth, Murphy said.

Murphy bought the car “as is,” or without a warranty, and said Auto Nerd wouldn’t help him with a repair or refund.

He filed a complaint with the Indiana Attorney General’s Office alleging Auto Nerd had sold him an unsafe product.

Documents they sent to Murphy showed Auto Nerd bought the car in May 2019 from auction with “structural damage” listed on the purchasing documents.

“I was pretty angry,” Murphy said.

Attorney Andrew Ault specializes in car dealership practices, and reviewed Murphy’s case.

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“Cars don’t just rust out to the point where you could die driving it for no reason,” Ault said.

Ault said dealers have to follow the Indiana Deceptive Consumer Sales Act and should tell a consumer about safety problems.

"The deceptive act was to not disclose that this is a potentially unsafe vehicle with structural damage," Ault said. “If they're regularly selling vehicles that have structural damage without disclosure, that's a deceptive act and could have bearing on the license of the dealer."

Dealers who are deceptive can lose their license to do business in Indiana.

Auto Nerd has two locations, Greenwood and Beech Grove, and of the 49 complaints filed with the Indiana Attorney General in the last three years — 27% of the allegations were for unsafe or defective products.

Auto Nerd has also paid more than $10,000 in fines since 2018 after the Indiana Secretary of State’s Office cited them for violations like failure to deliver titles, failure to produce records and misuse of dealer plates.

Auto Nerd’s profile on the Better Business Bureau website shows the company has a pattern of complaints including making misleading representations about the safety of vehicles and not responding in a timely manner to complaints.

Call 6 Investigates contacted Auto Nerd and offered to show them the hidden camera video from their Greenwood car lot.

Brandon Hockett, who said he assumed the “head role” at Auto Nerd a few months ago, did not agree to an on-camera interview with RTV6.

Hockett said employees are trained to direct customers with questions about a vehicle’s history to a Carfax history report.

“I can't begin to understand why any of our employees would suggest we don't sell any vehicles which have been involved in an accident when every single one of our employees is well aware of the Carfax history report being available upon request in person or on our website,” Hockett said in an email to RTV6. “Our training instructs our sales staff to direct potential customers to the Carfax history report on ANY/ALL questions related to the history of a vehicle.”

Here is Hockett’s statement to RTV6 sent on January 7.

“I apologize for the delay in responding to your inquiries. As I stated to you in our initial conversation, I began my role with Auto Nerd a few months ago. I am very familiar with the history of the company and its foundational values. Auto Nerd is a female owned Indiana based independent preowned auto dealer with two locations in central Indiana, soon to be three. We are one of the largest non-franchise dealers in Indiana for a few years running. The treatment of our customers and the integrity of our staff are two areas of business we take very seriously. Transparency is one of the foundational values we attribute our success to. The inquiry regarding Brian Murphy came as a surprise to me. Once learning of this unfortunate experience, I contacted our customer. I informed him of who I was and expressed my sincerest apologies for the negative experience he had in doing business with Auto Nerd. I expressed my desire to understand all the details of Mr. Murphy’s negative experience for a few reasons. First, to attempt to put myself in Mr. Murphy’s position, second to understand where we went wrong in our process as a company, and finally to form an approach to address the negative experience and make the best of a bad situation. We have mutually formed a solution to make the best of this unfortunate situation.

Another surprise to me was hearing the contents of an on-camera interview having taken place at one of our locations. The contents of this interview previously shared in one of your messages were very troubling to me. Our commitment to transparency is real. It can be traced back to the significant investment made to Carfax on a monthly basis. Our investment to Carfax allows every one of our potential customers shopping on our website to view a full Carfax history report at no expense. It also allows our sales staff to provide a Carfax history report on any vehicle offered at our locations at the request of a customer, again at no expense to the customer. Carfax is the industry standard when it comes to knowing the history of a vehicle. We rely heavily on Carfax history reports for inventory acquisition and point of sale material. I can't begin to understand why any of our employees would suggest we don't sell any vehicles which have been involved in an accident when every single one of our employees is well aware of the Carfax history report being available upon request in person or on our website. We have conducted our own investigation into this matter but were not able to pinpoint where this claim came from. Our training instructs our sales staff to direct potential customers to the Carfax history report on ANY/ALL questions related to the history of a vehicle.”

Hockett also pointed out their website includes links to free Carfax reports on some of the cars for sale.

Call 6 Investigates also reached out to Carfax to find out why their report did not include the structural damage found on Murphy’s vehicle.

“It might not have been reported,” Emilie Voss, a spokeswoman for Carfax, said. “Not every car accident gets reported, not every flood event gets reported and that's how we add information into our database."

Carfax recommends car buyers do three things before buying a vehicle— run a VIN check, do a test drive and take it to a mechanic.

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"If they feel confident in the vehicle they're selling, they should let you take it to a mechanic to get it checked out,” Voss said.

Only after Call 6 Investigates started asking Auto Nerd questions about Murphy’s case, did the dealer agree to take the vehicle back and provide Murphy with a refund of $8,500.

Murphy wishes he had gotten that response from the get-go.

"I'm very lucky there wasn't an accident with how bad the damage was,” Murphy said. “It's negligent to not tell someone about a potential serious safety issue when you're selling it to someone."

The Indiana Attorney General’s office investigated Brian Murphy’s complaint but did not find any violation against Auto Nerd and provided a statement:

“Mr. Murphy’s consumer complaint was closed. Following our investigation and based upon the facts available to the Office at the time, there was no conduct that was actionable within the authority of the Office of the Indiana Attorney General.

Vehicle sales in Indiana are considered “as is,” meaning any defects present on the vehicle are the responsibility of the new owner. It is the duty of the consumer to inspect the vehicle for any defects that may be present on the vehicle at the time of sale. Indiana law imposes no duty on dealers to affirmatively disclose defects on a vehicle, unless such defects have resulted in a title brand. This is why the Attorney General highly recommends consumers be vigilant when purchasing used vehicles and closely inspect the vehicle, test drive the vehicle in a variety of conditions, obtain a vehicle history report, and even have a mechanic inspect the vehicle. However, under the Deceptive Consumer Sales Act, a dealer may not make false statements regarding specific characteristics of a vehicle. If a consumer asks whether a vehicle has been in an accident, has a specific defect such as rust, frame damage, etc., the dealer should be truthful about the information it possesses regarding the vehicle to remain in compliance with the Deceptive Consumer Sales Act.”

Experts say you should not take a salesman at their word, but rather, get everything in writing and read it before you sign on the dotted line.

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