Why VIN checks are failing to stop cloned vehicles in South Africa

Kriben Reddy

South Africa introduced microdotting of vehicles as a legal requirement in 2012 to combat theft and fraud in the automotive market. Every new or used vehicle sold in the country must be microdotted before it reaches a showroom floor, part of a national effort to make stolen cars easier to identify and harder to resell.

Yet despite the legislation, cloned vehicles still make their way into the market. The reason is not a lack of regulation. There is a gap between what the law requires and what often happens in practice. 

Under the Second-Hand Goods Act 6 of 2009, dealers are required to inspect every vehicle they bring into stock physically and to record the microdot information in their official register. These records must be kept for five years and can be requested by law enforcement as part of compliance checks. 

In theory, that inspection process should make it extremely difficult for a cloned vehicle to enter the dealership ecosystem. In reality, many dealers rely on digital history reports that only confirm that a vehicle identification number (VIN) was microdotted at some point in the past. 

“That check tells you that a VIN exists in the system,” says Kriben Reddy, Founder and CEO of Kredo Mobility. “What it does not confirm is that the physical vehicle standing in front of you actually matches that VIN.” 

That distinction is critical. 

Vehicle cloning typically involves criminals copying a legitimate car's identity and applying that VIN to another vehicle. On paper, the records may appear clean, but the physical asset and the digital identity do not match.

Microdotting was designed to solve that problem. During the process, millions of microscopic dots are sprayed across the body panels and components of a vehicle. Each dot contains a unique PIN linked specifically to that vehicle. The pin cannot be accessed through databases or reports. It can only be extracted by physically inspecting the vehicle using specialised magnification equipment. 

“If you extract the pin from the vehicle and match it to the VIN, you know the car is exactly what it claims to be. If the VIN and the PIN do not match, you are almost certainly dealing with a cloned vehicle.” 

In an industry first, Kredo Mobility has introduced a VIN-to-pin solution to its platform that centralises that verification process. Dealers using the system can capture the VIN, extract the microdot pin during a physical inspection, and verify the two together. If the information aligns, the platform generates a digital certificate confirming the vehicle’s identity. 

That certificate not only helps prevent dealers from purchasing cloned vehicles, but it also creates a digital record that satisfies the compliance requirements of the Second-Hand Goods Act 6 of 2009. 

“For many dealers, the risk is not just fraud. It is compliance. If you cannot prove that you inspected the vehicle and recorded the microdot information, you can face fines or even temporary closure if authorities conduct an audit,” adds Reddy. 

The implications extend beyond dealerships. 

When a cloned vehicle enters the market, the consequences often ripple through the broader ecosystem, affecting financiers, insurers, and ultimately consumers who may unknowingly purchase a vehicle with a false identity. 

Recent legal developments are also starting to test where responsibility lies when something goes wrong in these transactions. 

“The industry has historically treated vehicle verification as the dealer’s problem. But when fraud happens, everyone in the transaction feels the impact.” 

For Kredo, the long-term goal is to move VIN-to-pin verification from a niche compliance step to a standard practice across the automotive market. 

That shift may not happen overnight. But as more dealers adopt stronger verification processes to protect themselves from fraud and regulatory risk, these checks are expected to become part of everyday vehicle transactions. 

“In the end, it is about confidence. If the vehicle's identity can be verified properly, it protects the dealer, the financier, and the consumer. Everyone benefits from a system that can prove the car is exactly what it claims to be,” concludes Reddy.