FedEx Named In What Could Be One Of The Largest Odometer Fraud Schemes In U.S. History

Odometer fraud is big business in the U.S. Estimates say the scheme costs consumers over $1 billion a year. And while it’s largely been relegated to sketchy dealers and private sellers on Craigslist you probably shouldn’t buy from, it apparently isn’t just there. On Friday, Automotive News reports that FedEx and Holman Automotive have been accused of rolling back the odometers of old delivery trucks in a new lawsuit.

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Companies like FedEx ordinarily get rid of their delivery trucks when they hit their operational limit, usually around 350,000 miles, but, in the suit, plaintiffs say a scheme involving old trucks started over a decade ago, when FedEx decided to stop scrapping the trucks and sent them to auto auctions instead.

… the lawsuit states, FedEx beginning in or around 2011 pursued another revenue stream by remarketing the fleet vehicles instead of destroying them. Holman is accused of mutually agreeing with FedEx to commit odometer fraud as part of the remarketing enterprise.

FedEx is accused of not only resetting the odometers of the vehicles that sold, but also not disclosing which vehicles had their odometers replaced. Holman, which managed FedEx’s commercial fleet, is accused of selling the vehicles for more than they’re worth due to the incorrect odometers.

One of the plaintiffs in the case is Tom Layton, a commercial truck dealer based in Henderson, Nevada. Speaking to Las Vegas’ KTNV, Layton says in 2017 he sold an old FedEx truck to a contractor in Washington state, who made the discovery and accused Layton of the fraud initially.

“About a month after the sale, the FedEx contractor contacted me and said, ‘hey! What are you trying to pull here? And I said, ‘what’s wrong?’ And he said, ‘I took this into Freightliner and had the vehicle hooked up to the computer. And it has over 400,000 miles. And your odometer says 180,000 miles’.

That’s when Layton says he “found out that the odometer was changed by FedEx, not by any car dealership.”

The suit is potentially on behalf of thousands of people across the country who purchased one of these vehicles. A spokesperson for Holman told Automotive News the company doesn’t comment on pending litigation, while a FedEx rep said the company “will vigorously defend the lawsuit.”