By Mark Lacek
The majority of tow company managers have at least a working knowledge of license plate recognition (LPR) technology. However, as LPR continues to reshape the repossession industry, it has evolved from a niche tool into a strategic asset. Repo agents and managers should consider whether or not to invest in this technology and its impact on efficiency and recovery.
Not long ago, repossessing a vehicle meant driving to multiple locations to find and recover the collateral. Repo agents routinely checked both home and work addresses, day and night, until they finally spotted the vehicle in default.
FASTER FUNCTIONALITY
Today, however, LPR is a more efficient tool to get the job done, by utilizing high-speed cameras mounted on a tow truck, or specialized “spotter” vehicles. These LPR-equipped vehicles travel the streets and parking areas every day, all day long. This new technology allows repossession companies to scan thousands of license plates per hour, cross-referencing them against massive databases of vehicles marked for recovery due to loan defaults.
In the past, repossessors relied on investigative leads and skip tracing to find hard-to-locate vehicles. With LPR, even the hardest-to-locate vehicle may be found with a single license plate scan.
Many repossession companies have spotter cars mounted with four externally mounted special cameras. The spotter car drives through apartment parking lots, shopping centers, storage yards, and up and down roads and highways. Every license plate visible to the camera is scanned. Industry standards and technical literature suggest that a single mobile LPR unit can typically scan between 1,000 and 5,000 license plates per hour, with a potential scan volume ranging from 8000 to 40,000 plates during a standard eight-hour shift. However, this number is highly dependent on the density of the environment, traffic flow, and the specific hardware configuration of the camera system. In dense urban environments, the number of scans can increase significantly because the vehicle is constantly exposed to a higher volume of both stationery and moving traffic.
FINANCIAL CONSIDERATIONS
Generally, the primary cost associated with an PR camera system consists of the initial hardware investment, which often reaches or exceeds $15,000 for a comprehensive, multi-camera vehicle-mounted system.
However, purchasing and installation of a camera system is just the beginning. Beyond the physical hardware, agencies must also account for the integration of software platforms that manage the dataflow between lending institutions and recovery agents.
LPR PROVIDERS
Among the most prominent vendors is DRN (Digital Recognition Network), which provides the L5M mobile LPR camera system. DRN operates by combining massive amounts of historical and real-time scan data, allowing repossession agencies to receive instant alerts when a vehicle on a "hotlist" is detected.
Another significant provider is Insight LPR, which focuses on providing professional agents with hardware kits and advanced analytics platforms designed to integrate seamlessly into existing repossession workflows.
PatrolWorks is an integrated Parking Management Solution developed by Ranger SST. The software digitizes parking permits and automates enforcement for multifamily residential complexes, commercial properties, and homeowners associations (HOAs) by integrating with mobile License Plate Recognition (LPR) camera systems mounted on security or spotter vehicles. This enables operators to scan entire parking lots rapidly from inside a vehicle rather than auditing spaces manually on foot.
Ynot Parking is a commercial parking and towing management platform that uses LPR technology to monitor vehicle access, validate visitor permits, and automate parking enforcement. Property managers and towing companies deploy the system to eliminate physical parking stickers, paper tickets, and manual permit tracking.
Generally speaking, companies using LPR can function not only as hardware manufacturers, but also as data brokers, maintaining vast networks of repossession assignment forwarders and automobile lenders.
LEGAL CONCERNS
Academic analysis of surveillance technologies suggests that while LPR has increased the efficiency of repossession, it has also prompted significant legal and ethical discussions regarding privacy and the scope of data retention by private entities. In the United States, there is currently no singular federal statute that explicitly permits or prohibits the use of Automatic License Plate Recognition (ALPR) by private repossession companies.
Consequently, the legality of these systems is determined primarily by state law, which varies significantly across jurisdictions. In many states, the use of ALPRs by private businesses is permitted under the general umbrella of commercial data collection, provided that the data is used for legitimate business purposes, such as identifying collateral for repossession. Some states, though, have negative opinions on the use of LPR.
In December 2023, the Arkansas Attorney General issued an opinion stating that a company may not use an automatic license plate reader to track and repossess vehicles. Maryland, Montana, Nebraska, North Carolina, and Utah have laws that govern the use of automatic license plate reader systems, although with different scopes and requirements.
DATABASE DETECTION
LPR technology functions by capturing high-speed images of license plates and instantly cross-referencing them against databases containing records of stolen vehicles, wanted suspects, or vehicles linked to active investigations. In addition to the repossession industry, LPR systems are instrumental in the rapid recovery of stolen property and the location of missing persons. In cases involving Amber Alerts or Silver Alerts, LPR networks provide a "digital dragnet" that can track a vehicle's trajectory across multiple jurisdictions in real-time.
While law enforcement success stories widely support the efficacy of LPR in stopping crime, experts also emphasize the importance of balancing these technological gains with privacy considerations and rigorous oversight to maintain public trust.
THE FIGHT AGAINST LPR
An article written in the April 24 edition of the online repossession news source, CURepossession, reported on a new Federal bill introduced in the nation’s Capital to limit LPR use. Titled the Surveillance Accountability Act, the newly introduced bill could significantly alter the use of LPR within the repossession industry.
The CURepossession report stated that, “While it does not single-out the repossession industry’s use of LPR, if enacted in any meaningful form, this bill would represent one of the most consequential shifts the repossession industry has seen in over a decade. The bill requires that any government search that significantly impacts privacy must be supported by a warrant based on probable cause. It goes further by addressing how data is collected and accessed in today’s digital ecosystem, particularly when that data is held by third parties.”
The bill would not directly regulate private repossession agencies, nor outlaw LPR usage in the private sector. Also, it does not prohibit the collection of publicly visible license plates.
It is clear that the Surveillance Accountability Act faces a difficult path forward. The opposition to LPR technology is primarily driven by civil liberties organizations and legal experts who voice concern over the ability to reconstruct a person’s life, habits, and associations through the collection of location data. Organizations such as the American Civil Liberties Union (ACLU) have been at the forefront of this discourse, arguing that the indiscriminate collection of location data by private repossession companies constitutes a form of warrantless surveillance.
In many jurisdictions, these groups have lobbied for stricter regulations on how long data can be stored, who can access it, and whether it can be shared with law enforcement agencies without a warrant. While courts have generally been hesitant to ban LPR technology outright, they have increasingly scrutinized the "data broker" model, where repossession agencies sell or share their massive databases of location history with third-party aggregators.
The language in the Surveillance Accountability Act does not ban the use of LPR technology, but it directly challenges the legal assumptions that have allowed LPR networks to remain a valuable tool for repossessors and repossession agencies.
However, it’s up to individual tow managers to decide on the use of LPR as a tool for repossessors to locate and complete their mission. LPR cameras are likely here to stay, even as the technology continues to evolve and privacy debates consist. Tow managers and repo agents are strongly encouraged to keep tabs on further developments in LPR legislation and make necessary business adjustments accordingly.
Repo Editor Mark Lacek has over 35 years of recovery experience. He is the former editor of “Professional Repossessor” magazine. Lacek is a sought-after repossession expert witness and has been retained by law firms across the country in many repossession-related lawsuits.