News in 2015

Recently, I was at the ARA National Convention in Charlotte, NC and a good customer of ours came by and asked if the NMVTIS reporting requirements had changed. I told him I was not aware of any recent changes but asked what he had heard. He proceeded to tell me that he operates in Connecticut and that, in his state, he turns in titles on all purchases to the DMV, and the DMV issues them a salvage title or junking certificate in their business name. The state law requires them to do this before they can start dismantling a vehicle. He also told me that the Connecticut DMV had just completed a big update to their state system. His DMV officer told him that because of their new system, the state was actively reporting to NMVTIS and that he did not need to report to NMVTIS anymore. I told him I was not aware of any changes, but I would double-check and get an answer for him. Later at the show, I heard the same thing from another company Connecticut. After the show, I reached out to the American Association of Motor Vehicle Administrators (AAMVA) that operates the NMVTIS database, and to DOJ, who governs it, and I confirmed that Connecticut is not currently reporting salvage data to NMVTIS on behalf of its salvage yards. The state is reporting title changes to NMVTIS for titles issued by the state, but it is not sending the required NMVTIS information for the salvage yards to meet the federal reporting requirements.

NMVTIS is a database that contains vehicle information from 44 states, as well as reports made by salvage businesses in all 50 states. The database contains title brands issued by participating states and according to AAMVA NMVTIS contains 96% of all the US DMV data. The seven states not currently sending title data are all in various stages of development, but the exact timing has not been determined.

It is important to know that a vehicle has essentially two identities: a physical identity and a “paper” identity. The physical identity is pretty simple, it refers to the actual physical vehicle. The “paper” identity refers to the “title” status of a vehicle. Because a vehicle is generally considered the 2nd most valuable item that most people ever own, the title status is important, as it can affect the vehicle’s value. Because of different rules and processes in each state, there have been issues in the past with titles being “washed” of undesirable title statuses by simply titling and re-titling a vehicle in other states. For example, a vehicle branded as “junk” in one state is registered in another jurisdiction with less stringent titling rules, then again in yet another state with still different title regulations. The vehicle moves from state to state, and its title is gradually “washed” of the junk brand, so a “clean” title can be presented, disguising the vehicle’s real condition and value.

NMVTIS is a way for an individual, business, DMV and law enforcement to follow a vehicle’s lifecycle from new vehicle to “death” (salvage/scrap). NMVTIS also helps prevent VIN cloning, where the “identity” from a legitimate car is transferred it to a stolen vehicle of the same make and model, allowing the stolen vehicle to be sold to an unwitting buyer. Currently there is only one state (Georgia) that is reporting salvage vehicles data to NMVTIS on behalf of its salvage yards, metal recyclers, crushers/shredders, and dismantlers/recyclers. Georgia does not report records to NMVTIS on behalf of salvage auctions, tow companies or regular dealers/rebuilders. For Georgia to report to NMVTIS on behalf of the affected businesses, the business must report their purchased vehicles to the state within 48 hours of purchase. Georgia auto recyclers report the vehicles they handle to the state of Georgia, and in turn, the Department contracts with a provider to offer an electronic reporting method that satisfies the Georgia salvage reporting requirements and federal NMVTIS reporting requirements for affected businesses. Reporting is done electronically through Auto Data Direct, which also provides an electronic title cancellation process in additional to the combined Georgia and federal reporting.

Other new programs and processes have been added in states in the last few years that have added to the confusion around NMVTIS reporting. Several states have adopted a required state theft verification or lien check requirement which businesses must perform, but none of these checks include reporting to NMVTIS on behalf of a recyclers. Alabama, South Carolina, and North Carolina all have the theft check requirement, where the businesses report to the state at the time of purchase all vehicles purchased and the state system performs a theft check and gives the business a “red” or “green” light to proceed with dismantling the vehicle. Alabama is actively looking into adding NMVTIS reporting to their state check but has not yet had the process approved or completed development. If Alabama is successful, North and South Carolina have expressed interest in also reporting for their participating businesses.

Auto Data Direct is committed to the NMVTIS program and will continue to keep the industry informed on any changes or developments in the NMVTIS program. We will continue to provide clear, easy–to-understand notice of any changes or developments. Unfortunately, the responsibility for reporting belongs to the affected industries and misunderstandings at state levels as to what is actually being reported to NMVTIS continue to added confusion to the reporting process and the affected industries.

If you have questions or concerns about NMVTIS reporting don’t hesitate to email us or call one of our friendly and knowledgeable customer service representatives at 855-300-3455 .