FedEx Faces Lawsuit Over Alleged Odometer Rollback Fraud in Van Resale Scheme

FedEx Faces Lawsuit for Alleged Odometer Rollback Fraud on Resold Vans

FedEx, the global shipping company, is currently facing a lawsuit for what is being called the largest odometer rollback fraud in history. The lawsuit accuses FedEx of replacing the odometers in many of its retired vans with new ones that read zero miles, using the vans for a period of time, and then selling them at auction with artificially low mileage readings. This has led to numerous mechanical issues for buyers, costing them significant amounts of money.

The practice of reselling retired FedEx vans is common, with many of them being repurposed as food trucks due to their size and boxy shape. However, the lawsuit alleges that FedEx intentionally replaced the odometers to inflate the value of the vans, leading buyers to believe they were purchasing vehicles with low mileage. In reality, the vans’ actual mileage was sometimes as much as four times the indicated mileage on the new odometers.

The lawsuit was first brought to light by Tom Layton of Henderson, Nevada, who noticed the odometer rollbacks in 2017. Layton, a veteran in the truck and van buying and selling industry, purchased a FedEx Freightliner truck with around 180,000 indicated miles. However, when he sold the truck, the buyer discovered that the real mileage was around 400,000 miles. Layton filed his own lawsuit at that time, which is separate from the current class-action lawsuit against FedEx.

Since Layton’s discovery, customers from various states, including California, Tennessee, New Jersey, Florida, and Virginia, have reported similar odometer rollbacks on former FedEx vehicles.

FedEx had previously scrapped its retired vans once they reached approximately 350,000 miles. However, in 2011, the company started auctioning off the vans through its fleet company, Holman Fleet Leasing, which is also named as a defendant in the lawsuit. The lawsuit alleges that both FedEx and Holman intentionally replaced the odometers to increase the vans’ values and generate higher profits from the auctions.

While it is not illegal to replace odometers or sell vehicles with inaccurate mileage readings, sellers are required to provide a disclaimer to buyers indicating that the mileage is inaccurate and the odometer has been replaced. According to the lawsuit, neither FedEx nor Holman provided such a disclaimer.

FedEx denies the allegations and has stated that it will vigorously defend the lawsuit. The company’s representative told Spectrum News, “We are aware of the allegations made in the complaint and will vigorously defend the lawsuit.”

The Drive reached out to FedEx for a comment but has not received a response at the time of writing.

As the lawsuit unfolds, it raises concerns about the integrity of odometer readings and the potential impact on buyers who rely on accurate mileage information when purchasing used vehicles.

What potential penalties and consequences could FedEx face if found guilty in the lawsuit

, a former FedEx employee and whistleblower, who noticed discrepancies in the mileage of the vans being resold. He alerted authorities and subsequently filed a lawsuit against the company. The lawsuit claims that FedEx violated federal laws, including the Federal Odometer Act and the Racketeer Influenced and Corrupt Organizations (RICO) Act.

The alleged fraud has had significant consequences for the buyers of these resold vans. Many of them, expecting low mileage vehicles, have experienced mechanical issues soon after purchasing the vans. These mechanical issues have led to costly repairs and interruptions in their businesses.

FedEx has yet to publicly respond to the allegations in the lawsuit. However, if the lawsuit is successful, the company could face substantial penalties, including financial damages and fines. Additionally, this scandal could potentially damage the company’s reputation and erode customer trust.

This case highlights the importance of transparency and honesty in business practices, especially when it comes to selling used vehicles. Odometer rollback fraud is not only illegal but also unethical, as it deceives buyers and undermines their trust in the market. It serves as a reminder for consumers to be vigilant when purchasing used vehicles and to thoroughly inspect and verify the mileage of any vehicle they intend to buy.

As the lawsuit against FedEx progresses, it remains to be seen how the company will respond to the allegations and what consequences it will face if found guilty.