Insurers urge governments to close Re-VINning loopholes

By HUB SmartCoverage Team on October 1st, 2024

Canadian insurers are calling on the federal and provincial governments to crack down on loopholes that allow car thieves to give stolen cars a new Vehicle Identification Number (VIN) and then sell them to unsuspecting customers.

While the Insurance Bureau of Canada (IBC) commends all levels of government for their efforts to reduce auto theft, it says the focus has so far largely been on preventing stolen vehicles from leaving the country, according to an article on IBC’s website.

“A growing number of vehicles are stolen, rebranded, and sold to unsuspecting customers here in Canada through a practice known as ‘Re-VINning’,” said Hanna Beydoun, manager of policy at IBC.

A VIN is a unique, 17-character code assigned to every manufactured vehicle. It provides the vehicle’s serial number as well as its make, model, year and place of manufacture.

“It’s like a fingerprint for cars,” IBC explains.

Re-VINning is when criminals try to alter the VIN of stolen vehicles to conceal its identity. This enables them to register and sell the vehicle to an unsuspecting buyer.

Consumer risks

The consumer risks associated with re-VINning are significant. If the true identity of a re-VINed vehicle is discovered, the buyer will have their vehicle seized and returned to the true owner, often with no recourse for financial compensation unless the vehicle was purchased from a licensed dealer.

It can also lead to the potential denial of insurance claims. Anyone who knowingly purchases a stolen vehicle may also face criminal charges.

Auto theft not only affects the individual buyer but also drives up the cost of auto insurance for everyone.

IBC estimates that in Ontario alone, auto theft added, on average, an extra $130 to drivers’ insurance premiums.

The re-VINing process involves two critical steps, according to IBC:

Accessing a credible (albeit false) VIN: In Ontario, for example, a criminal could purchase a registrant identification number (RIN) history for a small fee, which would include sensitive information like VINs, making it easier to disguise stolen vehicles with legitimate-looking identifiers. A RIN is a unique number assigned to each vehicle owner in Ontario that tracks the vehicles they own or have owned.
Using the false VIN to register the vehicle: Criminals exploit vulnerabilities at provincial registration authorities to fraudulently register the stolen vehicle.

While these issues are more pronounced in Ontario, says IBC, they also exist in other provinces which compromises the integrity of vehicle registrations nationwide. As such, provincial governments can play a pivotal role in tackling re-VINing by closing loopholes that allow the exploitation of VINs.

Ways to stop Re-VINning

IBC is calling on the federal government to establish a National VIN Registry to promote information-sharing between provincial registries.

“Provincial centres that administer vehicle registration, such as Service Ontario, do not have a system that checks if a VIN already exists in other jurisdictions,” IBC said. “This means a vehicle can be registered in one province with the same VIN as a vehicle registered in a different province.

“This loophole enables criminals to register stolen vehicles with a duplicated VIN, making it difficult to track and identify stolen cars across provincial borders.”

In the federal government’s National Action Plan on Combatting Auto Theft, released May 2024, the feds urge the provinces to make “investments to enable comprehensive data sharing across jurisdictions through the existing Interprovincial Record Exchange.”

IBC is also calling on provinces to close other loopholes exposing Canadians to re-VINning. It is asking provinces to:

Eliminating public access to RINs: This will prevent criminals from easily obtaining detailed vehicle information.
Banning third-party VIN authorizations: Third-party registration allows someone other than the vehicle owner to complete the registration process on the owner’s behalf. While this process was initially intended for car dealers and dealerships, it inadvertently allows nearly any individual to transfer registration of a vehicle or register a vehicle in another person’s name. This is typically done for convenience, but criminals exploit third-party registration by using a fake identity to register a stolen vehicle.
Restricting use of new vehicle information statement (NVIS) forms to licensed car dealers: Auto manufacturers produce an NVIS form to register new vehicles for the first time. However, these forms are being forged and used to register vehicles with older model years. Restricting their use to dealers will prevent this.

In the meantime, what can buyers do to protect themselves?

Anyone shopping for a vehicle should check their prospective new vehicle’s information against a Carfax report. The report information should match what is provided by the seller.

Car buyers in Ontario should also have the seller provide a Used Vehicle Information package which is mandated by law. It contains essential information, including vehicle details, registration history, lien status, Retail Sales Tax (RST) details, and the bill of sale.

With files from Insurance Bureau of Canada, Canadian Underwriter

How drivers auto data is within reach of thieves, hackers