The investigation has resulted in more than 500 charges against five Toronto men, the Toronto Star reported.
Some victims of the scam got vehicles that had no air bags and weak welding, the report said.
Police said the cars, sold by Auto Enterprises, have fake structural certification that says they are road worthy, the Toronto Sun said.
Letters have been sent out to the registered owners of the vehicles by the Ontario Ministry of Transportation, asking them to be brought in to make sure they are safe, Niagara detective Dave Shennan said.
"We anticipate the general public will cooperate and bring the vehicles in for true structural inspections," Shennan said.
Insurance companies have also been notified, he said.
"If you don't bring in the vehicle because the ministry wants you to bring it in, the insurance company is going to want you to bring it in," Shennan said.
Many of the owners likely will not be compensated if they lose their vehicles, Shennan said.
"Some of these vehicles are a mishmash put together that I wouldn't want my loved one behind the wheel," he said.
Reindeer recovered after escaping from Santa during lighting ceremony
'SNL': 'Anchorman 2' cast, One Direction sing 'Afternoon Delight' [VIDEO]