Ferrari Dealership Altered Odometers on Used Vehicles for Profit

by Matt Posky

Published: February 28th, 2018

ferrari dealership altered odometers on used vehicles for profit

News broke earlier this week of a Ferrari dealer embroiled in a lawsuit after a salesman accused the company of authorizing the use of devices that roll back vehicle odometers. Despite being a great way to improve the valuation of a used car, the practice is generally frowned upon — our best guess is because it’s super shady and totally illegal.

However, it was unclear if the issue revolved around one grubby dealership in Palm Beach or a systemic problem that included the manufacturer. The DEIS Diagnostics System that made the shenanigans possible does require online authorization from Ferrari corporate offices. But it could be that someone at home base didn’t know the extent of what the tool was actually being used for.

Unfortunately, they did. This week, details emerged from the case files of Robert “Bud” Root’s lawsuit against New Country Motor Cars. Back in April of 2017, Ferrari issued a memo to the dealership that can best be paraphrased as “cut it out.”

Root’s lawsuit is less about busting Ferrari than establishing wrongful termination from the dealership. However, he does claim that his taking a stand against the odometer manipulation contributed heavily to his losing the job. According to court documents obtained by The Daily Mail, Root alleges he was fired shortly after discovering how the business rolled back vehicle mileage to artificially inflate prices.

The documents also point the finger at the corporate offices by explaining the procedure: “Each time the Deis Tester device is utilized on a Ferrari vehicle, authorization is obtained from the Ferrari entities via a wireless network connection. During the process, vehicle diagnostics and procedures performed with the Deis Tester device are automatically uploaded to a Ferrari database.”

The matter came to a head when a 2015 Ferrari LaFerrari owned by C. Stephen McMillian, a retired CEO for Sara Lee, allegedly paid a technician to reset his vehicle’s milage to zero. Root says he expressed his concerns on the legality of the deal to his employer and was fired as a result. Since then, he has made claims that this is common practice among Ferrari dealerships worldwide.

Adding credence to this claim is a memo from Ferrari published in April of 2017 and filed into the courts this month. The letter makes specific mention of the diagnostic tool, saying it would no longer provide NQS ECU reset cycle codes. “By May 15, 2017, Ferrari SpA will release a software update for the DEIS tester that includes removing this cycle,” the memo reads. “As a result … the odometer ‘reset to zero’ functionality is being removed.”

While tampering with an milage is a major misdeed, Ferrari provided a statement saying the DEIS unit was within its legal limits.

“Resetting an odometer to zero in case of a malfunction of the odometer when the pre-repair mileage is unknown is consistent with the federal odometer law,” explained Krista Florin, director of communications. “Ferrari determined that the risks of odometer fraud in the United States from unauthorized use of the DEIS tool outweighed the convenience of this functionality of the tool, and thus, Ferrari has informed its network with a technical bulletin that a software update to eliminate the odometer reset functionality of the DEIS tool was necessary and disabled this functionality.”

#CrimeAndPunishment #DealerNews #Ferrari #FerrariLaFerrari #HotLegalAction #Lawsuits #Scams

Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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SuperCarEnthusiast on Feb 28, 2018

Now you know the real reason it is so costly to repair an used Ferrari; it has more mileage on it then stated; resulting in more repairs because everything is more wore out!

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Notapreppie on Mar 01, 2018

> Ferrari Dealership Altered Odometers on Used Vehicles for Profit Is there another reason to alter an odometer?

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