Archive for the ‘Fraud’ Category

Exxon Finally Pays (albeit not enough)

February 5, 2008

According to an Associated Press report, Exxon Mobil has finally paid its debt to the State of Alabama.  Exxon paid $121.5 million as a result of the lawsuit brought by the State of Alabama over natural gas royalties.  The case had been tried twice to two different juries and appealed twice to the Supreme Court of Alabama.  Both twelve member juries unanimously ruled in favor of Alabama, and the final judgment was for $3.6 billion dollars, but the Supreme Court of Alabama reduced the verdict to $51.9 million.

After the reduction, the Supreme Court of Alabama remanded the case back to the Montgomery Circuit Court for a determination of the interest accrued during the appeal.  Judge Tracy McCooey made the final determination as to the amount.  The attorney for the State, Jere Beasley, argued that the amount should be $20 million more, and that issue is reserved for appeal.

Flood Car Fraud

June 20, 2007

Is a Flood Car Coming to a Town Near You?

 Reprinted from www.TrustMyMechanic.com

 

Hurricanes have done major devastation to the southern coastline, and the clean up project will likely take years to return things to some what normal. What I am concerned about is the potentially HUGE number of vehicles that will soon come on the market to be sold as used cars. The problem is not that the vehicle is used, but that it is potentially a casualty of the hurricanes and high water. These used cars are generally known in the business as “flood cars.”Now I know what you are thinking, “I don’t live in these Southern areas, so I am not at risk of unknowingly purchasing one of these flood cars.” Sorry, but you are dead wrong…actually the farther away you live from the hurricane damage, the greater you are at risk for being scammed into buying one of these cars.Why are you more at risk? Think about it. The flood damage took place in New Orleans, don’t you think that the residents there know that used cars on the market in that area have a HUGE potential to be flood cars? You bet they know that.But do you think the used car buyers in Arizona would suspect flood cars were brought into their area? Probably not, and the scam artists behind these flood cars know this. I would suspect these cars will be on the used car market for about a year…maybe more. This issue is huge and will hurt many people who make the mistake and purchase one of these vehicles.What is the big deal about a car that got water inside it if it seems to run just fine? Great question…even if I made it up myself. The engine itself might be fine, and long term engine damage might not have occurred, but there are many other components of the vehicle that can seem to be working normally now, but can deteriorate in the near future.Electrical components and wiring are usually affected most. There is a ton of complex wiring under the hood, in the dashboard, and under the carpeting of the vehicle. Water gets inside the vehicle from underneath from holes in the frame and body and around the door openings. If the carpet gets wet, so does the vast network of wiring under the carpet. The carpet can easily be replaced, but the wiring under the vehicle is usually too complex and therefore too expensive to replace, so new carpet is laid on top of them, concealing potential damage.So what if the wires get wet? Rust my dear friend. Rust is your enemy, and rust you will soon have. These wires will now slowly begin to break down and rust will form on any part of the wire that is not protected. When the electricity traveling inside these wires makes contact with this rust, it will make a ground, and the electricity will stop traveling. Whatever component the electricity was traveling to, a fuel pump for instance, will soon stop working. Finding the trouble spot in the miles of wire is not an easy task. The carpets and seat will probably have to be removed and hours of diagnostic time will probably be accumulated as the mechanic tries to find the trouble spot. In most cars, the onboard computer system is located in the lower part of the passenger dashboard area, just inches above the carpeting. Some Japanese vehicles have the computer located under the passenger seat, on top of the carpet! If the computer system gets wet, not only will it need to be replaced, but it can damage many other electrical components as well.The computer can be replaced now, and all might seem well, but the rust will soon make its way to these other electrical components and a domino effect will probably start to happen. One sensor after another will fail, intermittent electrical problems will begin to happen, and your pocketbook will soon start to feel the ill effects of multiple monthly mechanic visits. I consider rust the cancer of automobiles, you have to keep cutting and cutting and cutting to stop its growth.Transmissions are another big ticket item that can be affected by water and not show symptoms for some time. When moisture enters the transmission, the normally light pink fluid becomes a light white/pinkish frothy mix, like a strawberry milkshake. The entire workings of the transmission are extremely complex and full of wires, sensors, and lots of rubber seals and O-rings. The water will cause the rubber parts to swell and leak, and the sensors and electrical components will soon succumb to rust and water damage as well.So what can you do to protect yourself from buying a flooded time bomb?

  • Be cautious of every used car on the market.
  • Take your time inspecting and test driving. A good deal today is usually a good deal tomorrow too, so don’t succumb to pushy sales people.
  • Inspect under the driver and passenger seats for obvious signs of rust on the seat tracks and metal seat frame.
  • Look at the headliner (the fabric on the roof inside the car). Once wet, the glue that holds this fabric in place will begin to weaken, and the fabric will begin to fall down completely, or will fall in small sections that will look like bubbles.
  • Inspect the undercarriage and the exhaust system for signs of large scale rust. I would expect a small amount of rust as being normal; ask your mechanic if you have questions.
  • Use your nose. If the inside of the vehicle smells damp and moldy, or feels damp to your skin…run!
  • Remove the wheels and inspect the brakes. This should be done anyway if you are inspecting a used car, but rust damage will really show itself on the brake components.
  • Inspect all under-hood fluids for water contamination. Oil and water will look like a chocolate milkshake, oil and transmission or power steering fluid will look like a strawberry milkshake.
  • Get the dealership or the seller to give you a written statement that to the best of their knowledge that 1) the car has not been in a flood, and 2) the car was not involved in any type of insurance claim that might have resulted in the original owner selling the vehicle to their insurance company as a “total loss.”
  • Get a CarFax report. These reports can provide very valuable information about the car, but I would not rely solely on them. CarFax may not have complete or updated information critical to your decision.

My website provides one of the best used car checklists I have been able to find. I highly recommend a would-be-buyer to print it out and follow the step-by-step guide. If you aren’t in the market for a used car yourself, be sure to pass this e-mail and checklist information on to your co-workers, friends, and family who are. Blessings, Austin C. Davis,
The Honest Mechanic
www.TrustMyMechanic.com


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