How Does the Car Buying Scam Work?

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How to Spot a Car Buying Scam

Cars For Sale By Owner

So, are you in the market to buy a car, RV, boat, or other outdoor equipment? Then you should be on the lookout for criminals who could be listing items for sale that they don’t actually own. The FBI, in a recent Public Service Announcement, shared some information and tips on a growing scam where crooks are targeting those who are looking to purchase cars and other vehicles online.

The FBI IC3 (Internet Complaint Center) recently released this alert. This is because they’ve received approximately 26,967 complaints with losses totaling $54,032,396 since tracking this problem from May 2014 through December 2017.

How Does This Car Scam Work?

A criminal will post an online advertisement that has a low price to get the attention of a buyer.

Scam Alert!

A criminal will post an online advertisement that has a low price to get the attention of a buyer. It will include photos that match the description of the vehicle and their contact information (usually an email address and a phone number).

When you attempt to reach out to learn more about the vehicle, the “seller” will send more photos and apparently a logical explanation for why the price is heavily discounted and suggests an urgency to sell. Some of the common excuses that are given include:

  • They’re going to be moving to a new location or are being deployed.
  • They obtained the vehicle as part of a divorce settlement.
  • The vehicle once belonged to a relative who recently died.

The crook may claim that they have a partnership with a legitimate company like eBay, when in reality they have no actual association with them. They may also even mention an included buyer protection program or a guarantee. This scam is often very complex and they will often send an email with a toll-free number that pretends to be another company.

The criminal then will give you instructions to purchase prepaid gift cards in the amount of the sale and then share the prepaid codes. You’re typically told that you will receive the vehicle in a few days.

What happens next? It is usually radio silence. You won’t receive any answers, responses, or return calls. You are ultimately left without your money and still needing a car.

How Can You Protect Yourself?

How Do You Protect Yourself

Cars.com

The old rule of thumb that ‘if something seems too good to be true, it probably is’ definitely applies here, as well. It is very possible that you may find a deal on websites like Craigslist or Facebook. However, if you use major car-buying websites like Cars.com, they have teams that are dedicated to help protect both buyers and sellers against fraud. Automobile industry experts recommend that you:

1. Before Purchasing a Car, Always Inspect it in Person

It’s a definite red flag if a seller doesn’t want to meet or talk or in person and will only communicate via email or text. Another warning sign includes a seller stating that they don’t currently have the vehicle or that they are going to need to have it shipped.

It is always best to have someone else go with you when you’re meeting a seller to see a car.

Car Inspection Before Buying

It is always best to have someone else go with you when you’re meeting a seller to see a car. And it is even better if you have a family member, a friend, or a mechanic who is very knowledgeable about cars and can check it out with you.

There are a few other things that you will want to check when buying a car, as well. This can include reviewing the vehicle history report with a reputable company like Carfax, and inspecting the status of the car title in person to be sure that it’s not a salvaged title. A Salvage Title is attached to a vehicle that has been deemed a total loss previously by an insurance company.

2. Stay Away From Car Listings That Seem Like a Steal

That super nice Cadillac Escalade is a few thousand less from a seller than anywhere else you’ve found previously? It’s very possibly not legit. There are online tools to check car prices on websites like NADA.com and KBB.com. It will allow you to get an idea of the average price for the vehicle that you may be interested in buying.

3. Always Think Twice Before Sending Money

Always Think Twice Before Sending Money

Beware Of Scammers Wanting Your Money

Using alternative payment methods like wiring funds, paying with gift cards, escrow services, and Bitcoin don’t just mean that you are going to have to take some extra steps. It could also be a sign that your seller is trying to pull one over on you.

You should also be very careful if you are requested to share your personal information unless it’s absolutely necessary and under guidance from your legitimate financial institution. If your Social Security number or bank account information happens to get into the wrong hands, you will be setting yourself up for future fraud issues. Ultimately your person details may be bought and sold on the dark web.

If and when you are in the market for a new or used car, take the time to be completely prepared before you buy. You also should look into options ahead of time for financing your car purchase. Your bank or credit union can assist in getting you pre-approved and advise you on the details of closing the loan safely.

It’s also important to never click links in emails from recipients that you don’t personally know. Be sure to check the email address to ensure that it’s really from who it appears to be.

What To Do If You’re The Victim Of This Scam

What To Do If You Are A Victim Of This Scam

SCAMMED / I Didn’t Think It Could Happen To Me

If you have been scammed and your money has been stolen, you will need to:

  1. File a police report with your local police department.
  2. You should also file a complaint with the FBI. Additionally, you can provide them with detailed information that the thief may have given you. This can include any account numbers or places where you sent funds or a description of the details of the advertisements and communications.
  3. Also, if you utilized a website or an online marketplace to purchase the car, immediately notify that company. Many companies have in-house fraud departments and support teams that will help resolve the situation and possibly prevent the thief from taking advantage of other consumers.

You need to be sure to keep all documentation throughout the buying process. This will enable you to cover yourself if anything doesn’t go as expected and you’ll have that documentation easily accessible to share if it is needed.

Conclusion

In Conclusion

New scams are popping up all of the time. If you are sure to stay aware and keep an eye out for the potential red flags, you will be able protect yourself when buying a car and during other everyday activities. Thanks for taking the time to read my post titled How Does the Car Buying Scam Work? Please feel free to leave Comments or Questions, please leave them below. Also, if you know of any other scams that I have not covered, please leave the information below and I will be glad to investigate. Take care.

 

Best Regards,

Mike

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