Close friend had an identical situation a couple of years ago. Fairly new Cadillac got sideswiped in parking lot accident. $5,000 damage. While at the dealership sales manager approached and had the same song and dance. Tremendous loss in value due to damage. Even alleged it would show up on a Carfax report, despite the fact they don't release customer information to Carfax.
Fortunately she blew him off and got the car fixed and kept it.
So I don't really doubt the basic premise of the story or the possibility of some gullible senior falling for it.
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