It is normal practice to replace a broken odometer with a new one. That is not fraudulent. However, when that vehicle is sold the seller is legally required to flag the title.
A lot of liability depends on why the odometer was replaced, who transferred the title (does FedEx transfer the title to Holman before sending the vehicle to auction, or does Holman hold the title the entire time?), and whether the title was appropriately flagged as "Not actual mileage".