New measures introduced by the DVLA to adhere to GDPR rules could lead to a spike in car fraud, motor industry insiders have warned.
In order to be compliant with the recently-introduced General Data Protection Regulation, the Driver and Vehicle Licencing Agency has insisted that previous keepers’ details will be removed from a car’s V5c log book.
However, the move could create a new hurdle for motor traders when trying to check the legitimacy of mileage displayed in a second-hand vehicle.
GDPR impact: Experts at vehicle data provider cap hpi said a change to vehicle log books that has come about so the DVLA conforms with GDPR could increase the likelihood of drivers buying clocked cars
The Driver and Vehicle Licencing Agency outlined their measures in a personal information charter, which documents how it will collect, hold or otherwise process information about motorists, and how it will comply with data protection law.
Part of these new efforts include one significant change to the log book that’s supplied to the owner of a vehicle once they’ve purchased it.
In the past, the paperwork included details of the previous keeper, but this will no longer be the case since the May 25 deadline for GDPR compliance.
Existing V5c documents are unaffected until they are updated and re-issued by DVLA, at which point the previous owner’s details will be stricken from the papers.
This has caused concern within the industry, as it will block dealers from being able to check the history of a vehicle for free.
Cap hpi says motor dealers follow a due diligence process before purchases, which includes a mileage investigation to ensure they aren’t buying vehicles with a tampered odometer.
It will also hamper the attempts of classic car owners to piece together their vehicle’s ownership history, by tracking backwards from the previous keeper.
Cap hpi said, following the GDPR cut off in May, dealers will have to pay the DVLA for every mileage investigation report it places on vehicles
Car clocking is on the rise…
Cap hpi said in December last year that car clocking as an illegal practice had jumped 25 per cent since 2014.
The spike is believed to be caused by private car owners rather than dodgy dealers and networks of fraudsters, as motorists looked for unlawful methods to avoid forking out on penalties for exceeding car finance mileage.
As part of PCP (Personal Contract Purchase) agreements – the most popular form of car finance in the UK – the driver’s monthly repayments are partly based on the mileage they say they will cover.
If they go over this pre-set limit they will be charged extra for every mile over.
An average addition of 10p per mile over the limit, for someone who agreed to a 5,000 mile PCP deal but ended up covering twice that, would incur a £1,500 bill at the end. In anyone’s book, that’s got to hurt.
That’s why it’s often cheaper for drivers to pay a ‘mileage correction firm’ to turn back the odometer and escape these, despite facing the risk of hefty fines and even jail sentences if caught doing so.
The fact new cars aren’t MOT’d, and thus don’t hook into official mileage recording networks, for the first three years of their life could also be a factor.
The vehicle data experts claim this reduces the dealer’s exposure to financial risk and helps protect their public reputation. And the positive knock-on effect of these checks is that they help the entire industry to reduce vehicle fraud.
Following the GPDR changes and removal of previous keeper details, all vehicle suppliers must pay the DVLA a fee for a full mileage investigation.
This could open the market up to a higher risk of fraud if traders decide against conducting them because of repeated charges to check multiple cars.
Cap hpi says that one in 16 vehicles have a mileage discrepancy, one in three have a hidden problem and one in five has had a plate change, based on its own data.
Wendy Swaine, head of retail at at the company, said: “The NMR (National Mileage Register) investigation itself gives dealers the peace of mind that the mileage on a vehicle they are interested in is accurate and that they can buy with confidence.
‘With so many clocked cars on the road in the second-hand market, it’s important to undergo an investigation before purchasing.
‘We appreciate the DVLA will be mindful of more stringent data protection legislation recently introduced.
How to check a second-hand car’s mileage before buying
Private buyers have alternative methods to check the legitimacy of a used car’s mileage.
The Gov.uk online MOT check service gives a full backlog of tests carried out on a car and what the odometer reading was over time.
The only issue is that all cars don’t have to undergo an MOT until they are three years old, making it increasingly difficult to prove the genuine mileage of models that are between one and three years old.
Buyers are urged to use this free tool to make sure there are no gaps in a vehicle’s history after three years and that the documentation provided with a car matches the online report.
Simply enter the vehicle’s registration number and you can access historical MOT information on the car
‘However, the change has many impacts on the way in which a mileage investigation is conducted as part of a hpi check or comprehensive manufacturer approved check. This change could have broader implications for the dealer network.’
She added: ‘With the potential of increased cost to dealers, there is a risk that some may opt to forego a mileage investigation, opening themselves up to accidentally making a risky purchase, and then potentially being hit by the reputational damage to their business when the fraud is uncovered.
‘It’s potentially a double whammy for dealers, the industry and the consumer, which is why we are urging the DVLA to look at the wider ramifications.’
A DVLA spokesman told This is Money: ‘We have made changes to the way we release previous keeper details from our records – only releasing information where there is evidence that it is needed for a legal reason.
‘In line with these changes we reviewed the process of automatically including the previous keeper details on every V5C, or log book, when we send it to the new keeper.
‘There is no reason why removing the previous keeper from the V5C should result in an increase in fraud involving used vehicles.
‘The law allows the DVLA to provide previous keeper details in order to assist mileage companies to investigate where mileage fraud is suspected. This process has not changed with the removal of the previous keeper details from the V5C.
‘We believe the processes in place strike the correct balance between protecting the personal data of our customers while maintaining the availability of information about vehicles to those with a legitimate right to receive it.’
SAVE MONEY ON MOTORING