You run a used car dealership. Someone shows you a device that adjusts digital odometers. A few thousand miles here, a few thousand there. Cars sell faster. Margins improve. State crime at worst, you figure. Maybe a civil dispute with an unhappy customer down the road. You've heard of dealers getting fined. You haven't heard of dealers going to federal prison.
Federal prosecutors see it very differently.
Under 49 U.S.C. 32703, odometer tampering is a federal felony carrying up to 3 years imprisonment per vehicle and $250,000 in fines per violation. But that's just the base charge. Prosecutors almost never stop there. They stack wire fraud, mail fraud, bank fraud, conspiracy, and money laundering charges on top of every count. One dealership rolling back 20 vehicles doesn't face 60 years of theoretical exposure - they face 400+ years when federal prosecutors finish stacking. And the investigation started long before you knew about it. The National Highway Traffic Safety Administration has been tracking suspicious mileage patterns through their SPIN database for years.
Welcome to Spodek Law Group. We handle federal odometer fraud defense across the United States. If NHTSA investigators have contacted you, if federal agents have shown up at your dealership, or if you've received a grand jury subpoena - you're facing something far more serious than a consumer complaint.
How Federal Prosecutors Turn One Car Into Ten Charges
The base statute is straightforward. 49 U.S.C. 32703 prohibits disconnecting, reseting, or altering an odometer to change the registered mileage. Maximum penalty: 3 years per violation. Fine up to $250,000 per violation.
But here's what actualy happens in federal prosecution.
Prosecutors use the odometer tampering charge as a foundation, then stack additional federal crimes on top:
1. Wire Fraud (18 U.S.C. 1343) - 20 years per count. Any electronic communication, any wire transfer, any email about the vehicle.
2. Mail Fraud (18 U.S.C. 1341) - 20 years per count. Any mailed title document, any postal communication.
3. Bank Fraud (18 U.S.C. 1344) - 30 years per count. If the buyer financed the purchase through a bank.
4. Conspiracy (18 U.S.C. 371) - 5 years. Planning with anyone else.
5. Securities Fraud - 25 years per count. The title document is treated as a security.
6. Money Laundering (18 U.S.C. 1956) - 20 years. Spending the proceeds.
One vehicle sale creates multiple charges. You roll back the odometer - that's one count. You create a falsified title - thats another count. You mail that title to the DMV - thats mail fraud. You receive a wire transfer for the sale - thats wire fraud. The buyer gets a loan from a bank based on your false mileage - thats bank fraud. Your spending the sale proceeds on your business - prosecutors can call that money laundering.
The New Jersey case shows how this works in practice. Felix Granowski and Alec Morgunov operated out of a dealership in Matawan. They bought high-mileage vehicles at auction, rolled back the odometers, falsified titles, then resold the cars. The investigation documented 118 vehicles with rolled-back mileage. Consumer losses totaled $674,606. Both defendants pleaded guilty to conspiracy to commit securities fraud. There facing up to 5 years each - and thats just the conspiracy charge.
The per-vehicle multiplier is what catches defendants off guard. Twenty tampered vehicles doesn't mean 20 counts. It means 20 odometer violations, plus 20 wire fraud counts, plus 20 mail fraud counts, plus however many bank fraud counts depending on financing. Theoretical exposure climbs into the hundreds of years. Practicaly, nobody serves that much time - but the leverage prosecutors gain is enourmous.
The conspiracy paradox makes it worse. Under 49 U.S.C. 32703, conspiring to tamper with an odometer carries the same legal penalty as actualy doing it. You don't need to complete the rollback. Planning it and taking steps toward it is enough. The Illinois case demonstrates this clearly. Laith Ghzo of Oak Lawn pleaded guilty in connection with causing odometers to be rolled back on hundreds of vehicles. He faces up to 5 years. He didn't personaly turn back the odometers - he caused them to be rolled back. Same penalty.
The Database That's Been Watching You
Most people don't know the National Highway Traffic Safety Administration maintains a surveillance database called SPIN - Stored Program Information Network.
What does SPIN track? Suspects. Defendants. Witnesses. Informants. Motor vehicles. Automobile dealers. Victims. And "other related data obtained through Federal grand jury subpoenas." The database has been operating for years. Its purpose, according to DOT documentation: "to support criminal investigations and prosecutions by the United States Department of Justice."
NHTSA's Office of Odometer Fraud Investigation operates four regional offices covering the entire country: Northeast, Southeast, Midwest, and Western. Each office is staffed with criminal investigators and administrative support. These aren't consumer protection bureaucrats - there federal investigators building criminal cases. The office has produced over 250 criminal convictions in more then 30 states.
The multi-jurisdiction trap is particuarly dangerous for used car dealers. State DMV agents work alongside federal investigators. The state agents are intimately familiar with motor vehicle documents - titles, registrations, the paperwork you handle every day. They know what the documents should look like. They know what anomalies indicate fraud. According to the DOJ's Civil Resource Manual, "Given that the investigations and prosecutions tend to require the accumulation of considerable documentation, obtaining the assistance of these agents is well-advised." Your state DMV has been feeding information to federal prosecutors. You didnt know they were working together.
By the time federal agents contact you, they've already built the case. They've subpoenaed auction records going back years. They've pulled title histories on every vehicle you've sold. They've requested bank records showing where the money went. There talking to your former customers, your former employees, your competitors who may have noticed irregularities. The investigation started months or years before anyone knocked on your door. When they finally contact you, its not to investigate - its to close.
What Federal Odometer Cases Actually Look Like
The federal odometer fraud enforcement machine has been running steadily for years. The numbers paint a clear picture.
According to NHTSA:
1. Over 250 criminal convictions in more than 30 states
2. Prison sentences ranging from 1 month to 10 years
3. Criminal fines totaling more then $2.8 million
4. Court-ordered restitution totaling more then $15 million
5. 450,000 vehicles sold annually with false odometer readings
6. Consumer losses exceeding $1 billion per year nationally
Recent federal cases:
- Kamal Khalid (Maryland, 2025): 36 months federal prison, approximately $1.2 million in restitution. He and his brother Fnu Shahrukh bought high-mileage cars at auctions, rolled back the odometers - averaging 124,000 miles per vehicle - and resold them. 118 vehicles documented. His brother recieved 18 months.
- Randy Lee (Wyoming): After a two-week federal jury trial, convicted of 11 felony counts including conspiracy, 5 counts odometer tampering, and 5 counts securities fraud. He purchased pickup trucks, rolled back the odometers over 100,000 miles each, obtained fraudulent Wyoming titles, and resold them. Sentenced to 37 months.
- Simon Nwaru (Ohio, 2025): 8-count federal indictment. Former owner of S. Automotive Ltd in Whitehall. Each vehicle rolled back between 80,000 and 100,000 miles. Case pending.
- Kansas businessman: 27-count federal indictment for rolling back odometers. Case pending in the District of Kansas.
The pattern is consistent. Prison time. Massive restitution. Felony record.
The Maryland brothers case shows what a medium-scale operation produces. Kamal Khalid, 44, from Pasadena, Maryland. Fnu Shahrukh, 31, from Severna Park. They operated from 2016 to 2019. Bought vehicles at auction. Rolled back the mileage - an average of 124,000 miles per car. Created titles matching the false mileage. Sold the vehicles through auctions or directly to customers at prices reflecting the lower mileage. The math on consumer losses: if each of 118 vehicles was sold for roughly $5,700 more than its true value, that's $672,000 in direct consumer harm. The court ordered restitution of aproximately $1.2 million. Kamal got 36 months federal prison and three years supervised release. His brother got 18 months.
If Your Under Investigation
The single most important rule.
Don't try to fix the problem yourself.
The instinct when you realize there's a problem is to correct it. Adjust records. Contact customers to "make things right." Offer refunds or settlements. Destroy documents that look incriminating.
Attempting to "correct" records after you realize you're under investigation is obstruction. Making undocumented restitution can be characterized as consciousness of guilt. Adjusting paperwork is tampering with evidence. The paper trail you create trying to cover your tracks becomes the evidence prosecutors use against you. Youve heard of people making things worse by talking to investigators - this is worse. Your creating physical evidence of your own guilt.
If you're under investigation or think you might be:
- Stop all communications with co-workers or partners about the situation. Those conversations can be subpoenaed.
- Don't destroy or alter any documents. Document destruction is a separate federal crime.
- Don't make payments or "settlements" without counsel. Prosecutors will use that as admission.
- Contact a federal defense attorney immediately. The earlier you engage counsel, the more options you have.
- Document what you know, but share only with your lawyer. Attorney-client privilege protects those communications.
Todd Spodek has handled federal odometer fraud cases. He understands the difference between cooperating intelligently and incriminating yourself further. That difference - early intervention with proper counsel versus panicked self-help - is often the difference between probation and prison.
When Your Ready
If you're facing a federal odometer fraud investigation, Spodek Law Group can help you understand exactly were you stand.
The consultation is free. We'll assess the stage of the investigation - NHTSA inquiry versus grand jury subpoena versus imminent indictment. We'll evaluate your exposure across all potential charges, not just the base odometer statute. We'll discuss realistic outcomes based on how these cases actualy resolve in federal court.
Call us at 212-300-5196. Federal odometer fraud investigations move fast once they become visible to you. The earlier you have counsel, the more leverage exists. We're here when you need us.
