Doubt cast on CarFax reports

FORT LAUDERDALE, Fla. — FORT LAUDERDALE, Fla. -- It was love at first sight when Dr. Roxanne Jeffries spotted the titanium blue Jaguar convertible at an upscale dealership. But wanting to be a smart consumer, she kept her head and asked the salesman: "Can you run a CarFax for me?"

Jeffries was delighted when the CarFax vehicle history report he handed over minutes later said there had been no reports of accidents, flood or frame damage for the car.


"It was a page covered with fat check marks, indicating it was a clean history," said Jeffries, an oral surgeon from Miramar, Fla. "I literally kissed the car's license plate in the parking lot."

Three weeks later, the Jag overheated and more problems followed.


Jeffries' husband did some research and discovered the 2001 Jaguar had been in a head-on crash less than a year before Jeffries bought it in 2002. With $16,000 estimated in damages, the dealership that then owned the car filed for insurance and sold the Jaguar for salvage, according to Raymond Ingalsbe, the couple's attorney.

Millions of used-car buyers every year turn to CarFax, the nation's best-known source for used-car history research.

More than 29,000 dealers have CarFax accounts, so they can instantly produce history printouts.

But auto fraud attorneys and car safety advocates say the reports are not foolproof, and even CarFax officials acknowledge they are not always complete. CarFax has limited access to insurance and accident reports, and no way to verify the accuracy of its information, they say.

In Jeffries' case, the police officer investigating the Jaguar's crash wrote down the wrong vehicle identification number, so CarFax didn't pick it up.

"I've found CarFaxes to be accurate less than 60 percent of the time," said Tim Blake, a Miami attorney specializing in auto fraud.

The only way to be safe, advocates say, is to have your own mechanic or a collision specialist inspect a used car before you buy.

Questions about CarFax reports are gaining renewed scrutiny as a result of a nationwide class action lawsuit that charged the reports were not as complete as the Fairfax, Va.-based company has led their customers to believe.


CarFax reached a settlement of the lawsuit last month. Under the settlement terms, millions who purchased a CarFax vehicle history report prior to Oct. 27, 2006, are eligible.

Those interested must file a claim form by May 27. The form is available at

But instead of receiving cash from CarFax, consumers who file claims will get free or discounted CarFax reports - the same documents that the consumers' attorneys said were incomplete. The other option is a 20 percent discount on an inspection, expected to run about $100, of any vehicle that buyers researched using CarFax.

If consumers don't opt out of the settlement in writing by March 13, they lose their right to sue CarFax if they are injured because of defects in a previously damaged car that a CarFax report claimed was clean.

Jeffries has filed suit against Palm Beach Motor Cars, which sold her the Jaguar. The dealership declined to comment on the case.

One nationally known auto fraud attorney, who was not involved in the class action, thinks the settlement is good for CarFax but not for consumers.


"CarFax is getting complete relief ... plus a coupon promotion and advertising money could not buy," said Bernard Brown, of Kansas City, Kan., who has testified on vehicle titling and safety issues before Congress. "They have been grotesquely overselling the information that they've got."

William Federman, the lead consumer's attorney on the lawsuit, said the settlement was the best option given "a tough situation." But he advised customers who bought vehicles with clean CarFax reports and who now are having problems with them to opt out of the settlement.

CarFax spokesman Larry Gamache said the company never implied that a report was the only tool a car buyer needs. He added: "We've always have encouraged people to get an inspection by a mechanic."

He said the company database has expanded from the days it encompassed records from less than half the states. Today, its 4.8 billion records are drawn from every state as well as Canada.

Grange Insurance, based in Ohio, will start giving CarFax its total loss information this year, Gamache said, and the company hopes to sign agreements with several other insurers soon.

CarFax and its chief competitor AutoCheck, which is owned by Experian, draw vehicle ownership, usage, title and accident information from a variety of sources, including state motor vehicle departments, police and fire agencies, auto salvage and auction businesses, and rental companies. But they historically have not had access to insurance claims.


Diane C. Lade writes for the South Florida Sun-Sentinel.