Fraud Alert – Abuse of the LPR System

FOR IMMEDIATE RELEASE

It has been reported to the Eagle Group XX Data Information Exchange that there is now a new scheme being used to make money by misuse of the LPR systems and it goes like this…

The Camera operators, both in their Camera Cars and Recovery Trucks scan apartment complex parking lots, workplace parking areas, shopping malls and other areas of highly concentrated parked vehicles to get a live hit on a vehicle out for repossession.

The prescribed and accepted protocol is that when they get a hit, they are to contact the forwarding firm or client to verify and obtain the recovery assignment order.

In this twisted scheme that protocol is ignored and instead when they obtain a live camera hit, they do not attempt to verify the recovery assignment but rather just pick up the vehicle and under a tow situation take it to their storage lot.

Once the vehicle has been towed and taken to a storage lot, the lienholder or forwarder is notified that they have the vehicle in an impound situation without revealing that they had originally scanned the vehicle and knowing it was out for repossession had picked it up.

By using this technique, it allows them to recover the vehicle even though they are not on an approved provider list and charge not only impound fees and towing fees but also storage, and other ancillary fees associated with an impound.

Under most circumstances the other approved recovery agency that has the original recovery assignment is called by the client to go pick up the vehicle and front all impound fees.

Other times the assignment is closed with the recovery firm that has the assignment, in a contingent situation and an auction is sent directly to pick up the vehicle with no recovery fees paid to any recovery agency.

Using this tactic on an LPR assignment would appear to not only be wrong, it is certainly dishonest and possibly illegal.

Given this situation, which is certainly a scheme that was not the intention of the LPR providers, we would ask “do they really care?”, we also would ask, “do the lenders really care?” If it is a concern, is there an action they can take to possibly remedy the situation?

Obviously the person who appears to be abused is the recovery agency and its employees who may have spent countless dollars attempting to trace and locate the vehicle as well as the field agents who have spent time and fuel money in their attempts to locate and recover the vehicle and now will receive no return on their investment.

Eagle Group XX encourages any recovery agents who know of anyone participating in this type of scheme to notify the LPR Company, the national trade associations (AFA, ARA, and the Eagle Group XX Data Information Exchange) as well as the local law enforcement authorities for civil or criminal violations. Remain vigilant.