Dodgy second-hand cars cost buyers £85m a year, says OFT

The Office of Fair Trading (OFT) has confirmed what many buyers have found out the hard way – buying a second-hand car is a tricky business, and sharp practices may be costing unwary customers hundreds of millions of pounds every year.

An OFT investigation launched after nearly 72,000 complaints to Consumer Direct last year concluded that the second-hand car market is "often not working well for consumers", according to the report published yesterday.

The findings will come as little surprise to many. The vast majority of faults come to light within three months of the purchase – perhaps no shock given that a "significant number" of dealers fail to fulfil their obligation to tell customers whether they have checked the car's history and what they have found.

Similarly, a "significant minority" of dealers show a "disregard" for their legal responsibility to provide after-sale care, leaving nearly a third of buyers' problems unresolved and costing an estimated £85m per year.

And not all the sins are of omission. "Clocking" – the practice of fiddling the mileage displayed on the odometer – remains "persistent" and is costing consumers a whopping £580m every year, according to the OFT. Although there are some legitimate reasons to alter a vehicle's mileage, the OFT does not believe they arise sufficiently often to justify the 50 businesses around the country offering so-called "mileage correction services".

Another favourite trick is for traders to pose as private sellers because that leaves the buyer with fewer legal rights, costing the public another £41m a year.

The problem is not the law. Legislation such as the Sale of Goods Act and the Consumer Protection from Unfair Trading regulations is fit for purpose, but more needs to be made of them.

The OFT is publishing new guidance for second-hand car dealers themselves, setting out their responsibilities and liabilities. It is also stepping up information for potential buyers, and urging the Vehicle and Operator Services Agency (Vosa) make MOT test mileage data available to companies offering services checking odometer readings.

It is also vowing to get tough on malpractice. "We will not hesitate to take enforcement action against dealers who are engaging in sharp practices that cause serious harm to consumers," the OFT said. "Tackling unfair practices in the second-hand car market is now an enforcement priority."