Interpretation ID: MOPOA.ETL

Ms. Patricia Libbert
Administrator
Motor Vehicle Bureau
State of Missouri Department of Revenue
P. O. Box 100
Jefferson City, MO 65105-0100

Dear Ms. Libbert:

This responds to your letter requesting guidance from the National Highway Traffic Safety Administration ("NHTSA") on the proper use of the secure power of attorney for odometer disclosure statements that is authorized by sections 580.13 through 580.15 of NHTSA's odometer disclosure regulation (49 CFR Part 580).

The question you ask is whether it is permissible under these regulations for a transferee who has authority to execute the odometer disclosure statement on behalf its transferor by virtue of a secure power of attorney, to use a general power of attorney to appoint a third party (such as a lienholder) to execute the odometer disclosure statement on its behalf.

The answer to your question is no. As you know, Federal Odometer Disclosure Regulations promulgated pursuant to the Truth in Mileage Act ("TIMA") (49 U.S.C. Chapter 327) forbid the same party from signing an odometer disclosure statement as both transferor and transferee. 49 CFR 580.5(h). This provision implements TIMA's goal of reducing odometer fraud by making illegal the execution of an odometer disclosure statement when only one of the two parties to the vehicle transfer would be aware of previous mileage disclosures. 53 Fed. Reg. 29471

(Aug. 5, 1988). An amendment to TIMA created the secure power of attorney as a limited exception to this prohibition. 49 U.S.C. 32705(b)(2)(A). That section authorizes one party to a vehicle transfer to use a power of attorney to delegate to the other party its responsibility for executing the odometer disclosure statement (i.e., to execute the odometer disclosure statement as both transferor and transferee), but only if the title is not available at the time of transfer because it is in the hands of a lienholder. Id. NHTSA regulations implementing

this provision also permit the use of the secure power of attorney when the title is unavailable at the time of transfer because it is lost. 49 CFR 580.13.

The purpose of the secure power of attorney provision is two-fold: to reduce undue interference with dealers' ability to promptly resell vehicles taken in trade that might arise from the requirement that the odometer disclosure be made on the title at the time of transfer and the prohibition against transferees executing the disclosure on behalf of transferors; and to preserve the protection against odometer fraud that is afforded by TIMA's provisions requiring odometer disclosure on the title and prohibiting the same party from signing the disclosure as transferor and transferee.

Allowing a transferee who has received a secure power of attorney for the purpose of odometer disclosure to use a general power of attorney to appoint a third party to make the odometer disclosure would render the fraud protections in the Federal regulations governing secure powers of attorney completely ineffectual. The general power of attorney would not be on secure paper, on a form issued by the state; and would not contain any of the additional provisions in NHTSA's regulations that are designed to protect against fraud. These include the requirements that the transferor who is giving the power of attorney disclose the mileage at time of transfer on the power of attorney form, sign the form (including the printed name), give the transferee's name and address, the date of transfer, and a certification as to whether the odometer reading reflects actual mileage (49 CFR Section 580.13(b) - (d)); and the requirements that the transferee sign the form (also including the printed name), return a copy of the form to the transferor, enter the mileage on the title exactly as it is disclosed by the transferor on the secure power of attorney form, and return the original secure power of attorney form to the state that issued it, along with a copy of the title or the original title, whichever is applicable (49 CFR 580.13(e),(f)).

In the absence of these safeguards, the recipient of the general power of attorney would be able to execute the odometer disclosure statement on behalf of both the original transferor and the original transferee, without having to comply with the Federal regulations governing the use of powers of attorney for odometer disclosure. Essentially, allowing a secure power of attorney to be transferred by means of a general power of attorney would accomplish indirectly what TIMA prohibits -- permitting the same party to sign an odometer disclosure as

transferor and transferee -- while providing none of the protections against fraud afforded by the secure power of attorney.

In any event, there should be no need for a dealer to execute a power of attorney transferring its secure power of attorney to a lienholder for the purpose of odometer disclosure. If the dealer has a buyer for a vehicle for which it has not yet received the title from the lienholder, the regulations provide that it may accomplish odometer disclosure by using Part B of the secure power of attorney form, by which it in turn designates its transferee as its attorney in fact for the purpose of odometer disclosure.

I hope this information adequately addresses your questions. If you have any legal questions concerning the Federal odometer disclosure law and regulations, please contact Ms. Eileen Leahy, an attorney on my staff, at 202-366-5263. Any questions or concerns regarding odometer fraud or the Federal odometer enforcement program may be directed to Mr. Richard Morse, Chief of NHTSA's Odometer Fraud Staff, at 202-366-4761.

Sincerely,

John Womack

Acting Chief Counsel

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d:9/19/96