Victoria's Auto-Wrecking Industry Is A Mess Of Crime, Danger And Awful Book-keeping

Picture: Victorian Inter-Agency Task Force Report

A report has just been released detailing an eight-month operation by Victoria Police investigating the state’s stolen car market.

Task Force Discover joined with the National Motor Vehicle Theft Reduction Council to investigate Victoria’s separated parts and scrap metal industries. For the most part, it’s a case of alert, but not surprised. Cars are stolen, cars are stripped down, car parts are sold off.

But it’s an industry that’s been increasingly bugging authorities for several reasons, namely because the plummeting price of secondhand cars makes insurance jobs more attractive, technology is actually making some cars easier to steal and the ease by which spare parts can be sold incognito on the internet.

The audit team knocked on 432 wreckers’ doors between September 2013 and June 2014 – about 90 per cent of Victoria’s auto scrap dealers (that they know of).

It’s important to know that a lot of the businesses audited are not criminals, just bad at business. Or book-keeping, to be more precise.

A lot of the breaches were along the lines of failing to notify the Written-Off Vehicles register, complete criminal history checks, screen employees and not publicly displaying business licensing and registration details. That makes them an attractive option for criminals looking to wash their hands and make a quick cash profit.

There’s a couple of quite incredible stories in the main 48-page report, which we’ll detail in a bit, but first, here’s a few key stats.

They found:

  • 7 in 10 business not holding the required authorisation to trade (ie the correct licence or registration) or being non-compliant to some degree with the conditions of their business licence or registration;
  • 9 in 10 not complying with written-off vehicle reporting obligations;
  • 9 in 10 assessed to be non-compliant to some extent with OHS and environmental protection regulations
  • Of the 132 businesses that sold cars, 42 had no records of sales whatsoever.
  • Of the 321 that sold parts, 151 had no sales records whatsoever
  • Of the 432 businesses audtied, 353 claimed they claimed to be unaware of reporting requirements and did not notify VicRoads of relevant vehicles

CASE STUDY: A Nice Little Earner

Task Force Discover detailed this example of what it alleges was an undercover operation to dismantle and sell stolen vehicles.

Between May 2013 and April 2014, the business had exported 11 containers of vehicle parts and accessories to Kuwait and Lebanon with a gross weight of 163 tonnes and a ‘free on board’ value of $394,113.

Six months before that, the same operators under a different business name had exported five containers to the same destinations, with a gross weight of 79 tonnes and a ‘free
on board’ value of $75,204.

That’s nearly half a million dollars in the space of 17 months.

Picture: Victorian Inter-Agency Task Force Report

The task force said the business deliberately kept a low profile. It didn’t advertise to buy vehicles and it didn’t sell vehicles through a shop front, preferring to use www.carsales.com.au and eBay.

In a spot audit, Victoria Police found two Toyota Prados, with one having been stolen in the previous 24 hours and the other having been stolen in the previous four days.

They got a warrant and returned in the afternoon to find five more stolen cars. Another 27 stolen cars were identified through their remains, in log books, winches, eTags and personal property.

All up, 70 stolen cars were eventually identified. They had a total insured value of $2 million, representing 8 per cent of Victoria’s profit-motivated car thefts in 2013.

As of July 2014, the dealer was still before the courts and had not been convicted.

No Hi-Vis Vests, Please, We’re Wreckers

Nearly a quarter of all the businesses audited needed to improve their workplace health and safety practices. There were numerous personal hazards:

  • Poorly stored and stacked vehicle bodies, panels, engines and parts;
  • Lack of training and induction in the safe use of machinery and plant equipment such as forklifts; and
  • Fuels and oils stored inappropriately near ignition sources.

And alarming environmental travesties:

  • Vehicles are drained of coolants, fuels, brake fluids and engine, transmission and differential oils on a non-sealed surface;
  • Waste water containing vehicle fluids, liquids or oils enters stormwater drains or is allowed contact with the soil;
  • Reclaimed refrigerants from air-conditioning units leak or are released into the air; and Vehicle tyres and batteries are not recycled.

But the pictures tell the best story:

Compliant

Picture: Victorian Inter-Agency Task Force Report

Mostly compliant

Picture: Victorian Inter-Agency Task Force Report

Non-compliant

Picture: Victorian Inter-Agency Task Force Report

Compliant

Picture: Victorian Inter-Agency Task Force Report

Mostly compliant

Picture: Victorian Inter-Agency Task Force Report

Non-compliant

Picture: Victorian Inter-Agency Task Force Report

You can read the full report here at carsafe.com.au.

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