How Did a Sandy-Damaged Truck Land on a Used Car Lot?

Part 1: ABC's "The Lookout" investigates how a flood car was sold at auction and put up for sale.
8:54 | 09/05/13

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Transcript for How Did a Sandy-Damaged Truck Land on a Used Car Lot?
And we start with a riddle, how could anyone in the heartland ever fall victim to a hurricane, one that blew ashore long ago and far away? Well, the answer is a flood car. Sold to an unwitting buyer. Superstorm sandy caused many of them to be sold. Tonight, we have a major update to our summer investigation. For this, "nightline" on the lookout. Reporter: When cars are in a flood for any length of time, a place like this is where most SHOULD PROBABLYÑi COME TO DIE. But not all do. We learned this lesson firsthand, thanks to this good looking pickup. We paid 20 grand for her in new jersey just two months ago, but now we would like to crush her in texas. Because even after this truck was inundated in the salt water of hurricane sandy, she still washed up on a used car lot with a clean title for sale to an unsuspecting customer. And sin a flood car with a bogus title can be a dangerous thing, you got to wonder how many more are there? That is the question I wanted to ask the good folks here at insurance company aaa. We're here to see rebecca hersch. We hauled our evidence across country and up to the gates of their headquarters. You're going to have to turn your camera off. Reporter: Hi, rebecca, how are you? Yeah, I know, but sometimes i persuade people. You have to see this tow truck we have to bring this truck down here to show you. It has dragons on it, it is awesome, come check it out with me. But we never got past security and it looked like a few defiant e-mails would be all we had. Are you a very small part to play in this story? How can you shirk this responsibility? But then came a pretty remarkable about-face. Can I call you kevin? Can I call you general? Take your pick, bill, i answer to both. Reporter: An about face led by the army-turned executive who invited us back. And this place is much more impressive than I pictured it. It would be, from the gate. Reporter: I'm just curious, there was so much resistance to talk before, why did you decide to come talk to us today? Truth is at this point, I'm all ready for journalistic combat with the general. But then he said the one thing i never expected. I think we would want to tell you thanks for shining the light on something that is troubling to all of us. Reporter: Wow, great. But why is the good general falling on his sword? Well, it has a lot to do with exactly how this ford ended up back on the highway. IF I CAN WALK AWAY GIVINGÑi YOU 20 for everything? You want to take it now? I want to take it now. Reporter: And it all began on a dark, stormy night. When superstorm sandy hit the northeast last fall, few were prepared for the misery she would bring, thousands lost their lives, many lost their homes, and then the there were the cars. An estimated 40 million of them submerged under water for days. Many abandoned here at the airport on long island. And look at them, each one a potential hazard. Because salt water flood cars are a special kind of wreck. Flood cars literally rot from the inside out, days, weeks, months later parts are going to fail. Which makes it a bit of a problem when you see the flood cars now empty. Yes, that is the same airport, packed after sandy, but empty today. So the obvious question is where did they all go? And the answer, like many things in life, has a lot to do with looks. Now, some cars obviously belong in a junk yard final resting place. But there are countless others that go through storms like sandy that look just fine at first blush. It is probably atlantic ocean. Reporter: And as the folks at the used car tracking service car fax showed us, they're looking better after a five-hour makeover. They are estimating over 5,000 sandy cars are back on the road tonight, not just around jersey but across america. We see the mercedes on the lot right there. Reporter: Here is one in omaha. And another in st. Louis. You know, it is kind of an old fashioned notion that they traded it in locally, right. Reporter: And even a landmark is passed off as pure. Even though hurricane sandy happened what? 1200 miles away, these cars are shipped all over the place. Dealers buy them, turn around, fix them up, make them look good and don't tell but it. Our ford f350 truck was one of those vehicles. Owned by mike, his kids loved the truck so much they named it "spirit." And we know that when sandy hit the kennedys watched sandy spoil their point pleasant home, and washed away spirit. Mike is a retired military man, so they declared spirit a total loss and sent mike a check for 32,$32,213 $32,213. They say it is the insurer's responsibility to brand the item, mark it as a storm-hit vehicle. But they had a price tag of nearly $20,000. A lot of dough for what the experts say should be a pile of parts. So we decided to buy it with the help of our producer aaron, 20 large in cash, and a few hidden cameras. And glasses and water bottle, just to make things interesting we sent spirit's former owner along for the ride. Here we go. How are you doing? Hi, I want to buy a truck, i want a big truck. Reporter: She is quickly chatted up by a salesman named jack, who very quickly gets her behind the wheel of spirit. The power seats don't work. I think the seat is out -- he has to change the fuse, he told me. Reporter: Now, maybe it is a blown fuse, or maybe it is because they were submerged in salt water for two days. Now, jack did reveal that a car fax report showed that spirit had been in a flood, but shrugged it off. It is like a glitch in the title. Reporter: A short time later, aaron has got a deal. She hands over the 20 large, signs the purchase agreement, and now aaron owns the truck. Here we go. How does it feel to be driving your old truck again? It feels great, feels good to be driving it again. But I don't want it. You can have it. Because she is not going to last too long. Reporter: The purchase creates a bitter sweet reunion for spirit's former owner, and mike can't resist taking it home for one more visit with the kids, where he notices a few obvious signs of her watery history. I had tools in the glove box, and believe it or not they're still here. They're no longer functioning, because they're rusted shut. The water was up to here. The front seats don't work. When we bought it today, they claimed it was a fuse, and to bring it back and swap it. It is not a fuse. I can't imagine whatever else is not working. Reporter: These guys sure will, they are jersey shore mechanics and know a flood mechanic whenever they see it. That is definitely a water-driven vehicle. That is like fine silt. Oh, my god, this thing may catch fire. If an air bag blows up on you, you could crash. Reporter: Would you put your family in it? Absolutely not in a million years. I wouldn't even drive this truck out of here. Reporter: Seems like a good time for me to have a chat with jack at the auto sales. We got a reaction camera going on this one. Reporter: We don't want to tip them off. So aaron makes it a point to have the power seats checked out.

This transcript has been automatically generated and may not be 100% accurate.

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