Carfax strives to make its reports error-free

At the urging of the National Auto Auction Association, Carfax Inc., a Fairfax, Va., provider of used-vehicle history reports, has created a toll-free hotline for auctions to report potential clerical errors in Carfax reports.

According to Carfax Vice President of Marketing Scott Fredericks, when a potential error is reported, Carfax tags the report as "challenged." A researcher returns to the information source to investigate the problem. If an error is detected, the report is corrected and the auction is alerted.

Until this change, auction queries were handled by Carfax but received no special treatment.

Carfax seems to be the most popular vehicle history reporting company among consumers. Its Web site, carfax.com, receives 1.25 million visitors a month.

Fredericks said Carfax collects data from 450 sources, including the departments of motor vehicles in all 50 states and Canada, emissions inspection stations, financial institutions and fleet/lease companies.

Using that information, Carfax issues vehicle history reports that reveal potential problems such as flood damage, odometer fraud and collision damage.

Because these problems can affect a vehicle's value, clerical mistakes are troubling to used-vehicle sellers. It gets messier when a retail buyer finds a discrepancy and assumes fraud has occurred.

Fredericks says mistakes occur, but they are few and far between - fewer than one out of every 100,000 reports. But with 41.6 million used vehicles sold in 2000, the number of mistakes could add up.

Fredericks said Carfax will pay up to $5,000 if one of its reports shows a clean history but a problem exists.

Auction managers, dealers and others who buy and sell wholesale used vehicles can learn more about vehicle history reporting issues at a workshop that will be conducted by Carfax and Autocheck, of Birmingham, Ala., another vehicle history reporting company. It will be at the National Auto Auction Association convention Oct. 2-7 in San Francisco.

You can reach Arlena Sawyers at asawyers@crain.com

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