FOR IMMEDIATE RELEASE                                         CIV
MONDAY, OCTOBER 21, 1996                           (202) 616-2765
                                               TDD (202) 514-1888

DEPARTMENT OF JUSTICE ANNOUNCES ASSAULT ON ODOMETER FRAUD

WASHINGTON, D.C. -- In the latest success in the Justice Department's effort to eliminate odometer fraud, a federal court in Philadelphia today unsealed an indictment against a car dealer and two accomplices for tampering with odometers.

Assistant Attorney General Frank Hunger of the Civil Division said that in recent months the Department of Justice has brought charges against more than 30 individuals in eight cities for similar offenses. Two people were sentenced to prison and two others pleaded guilty.

"Odometer fraud rips off hard working Americans who are trying to save money by buying a used car," said Hunger. "Americans who buy used cars deserve the truth. We will track down and prosecute those who tamper with the truth."

The indictment, returned October 10, charged that F. Charles Rossi, Jr., 50, of Annandale, New Jersey, a licensed car dealer, conspired with L. Thomas Spontak 50, of Dunellen, New Jersey, and Vincent Castelli, 41, of Brooklyn, New York, to defraud used car buyers, said Hunger and Michael R. Stiles, U.S. Attorney in Philadelphia.

The indictment charged that from 1992 until at least March 1995 Rossi, Spontak and Castelli agreed to purchase cars in Pennsylvania and New Jersey, roll back their odometers, and sell them at inflated prices. It alleged that Rossi altered the titles of the vehicles to conceal high mileage, and that Rossi and Spontak obtained new titles for the cars from New Jersey. It also charged that the two provided false odometer statements to buyers, misrepresented the mileage by as much as 90,000 miles, and that Rossi and Spontak committed securities and mail fraud.

The various charges announced today share several features. In all cases, the defendants were charged with purchasing late model, high-mileage vehicles, rolling back their odometers, and, by representing them as low-mileage vehicles, selling them at inflated prices. The charges state that the defendants obtained low-mileage title documents from state titling agencies, sometimes paying state personnel to ignore obvious alterations on vehicle documentation.

In addition, most of the cases allege attempts to conceal responsibility for the odometer rollbacks, the Department said. This was done by using false names and creating bogus sales documents showing transactions involving non-existent dealerships before the cars were actually resold.

Hunger said that despite efforts to evade responsibility, investigators can establish who was involved in turning back odometers. He said the Department has taken several steps to help this process, including increasing resources, improving cooperation between federal and state officials and developing computer software and an investigatory resources manual that investigators can use to streamline their efforts.

"Odometer fraud steals money from those least able to afford it," said Hunger. "People who buy used cars have a right to trust the mileage that was represented as accurate. They cannot afford the losses they suffer when they spend thousands for a car, only to find that the vehicle is basically worn out."

The National Highway Traffic Safety Administration estimates that odometer tampering costs consumers at least $4 billion annually in inflated prices. The problem has intensified as new vehicles become more expensive.

In recent weeks charges were brought against people for odometer tampering related offenses in Pennsylvania, Maryland, Virginia, North Carolina and Alaska. Sentences were imposed on defendants who pled guilty in Texas and California and additional guilty pleas were obtained in California.

It should be noted that indictments are merely accusations, and defendants are presumed innocent unless and until proven guilty.
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