How Can I Avoid Online Vehicle Sale Scams?

With online merchants you can have both legitimate sellers and scam artists…and sometimes it’s hard to tell the difference between the two. For example, online vehicle shoppers are being victimized by criminals attempting to sell vehicles they don’t own and are also making claims of bogus vehicle protection programs (VPP).  The criminals offer the vehicle below book value and claim they need to sell the vehicle because they are moving due to work or family situations.  Because of the move, they can’t meet the victim in person or let them inspect the vehicle, and are in a hurry to sell.  Smell a rat yet?

Scam examples

To make the deal legitimate, the criminal tells the buyer to send the payment to a third-party agent via a wire transfer service and fax the receipt to the criminal as proof.  The criminal takes the money and doesn’t deliver the vehicle.

Some scammers use the names of reputable companies to seem legitimate such as eBay Motors vehicle protection program. They promise coverage by eBay Motors for purchases not made from eBay Motors.  They tell the victim to pay via Western Union or Money Gram.

Another technique is to use a live-chat feature to answer victims’ question and assure them that the deal is safe.  They tell the victim that sales are protected by liability insurance coverage up to $50,000.

Beware of the following situations

Sellers who want to move the sale from one platform to another such as from Craigslist to eBay Motors.

Sellers who claim a vehicle protection program offered by a major internet company covers a transaction from a company outside that site.

Sellers trying to make a quick transaction and request payments via quick wire transfer systems.

Sellers who refuse to meet you in person or let you inspect the vehicle prior to purchasing.

Sellers who are not in the same location as the vehicle and claim they have been transferred because of work, deployed by the military or moved because of a family situation.

Vehicles advertised substantially below market value.

I’m a believer in the online market for auto purchases and auto sales.  I’ve personally purchased and sold cars online and if you’re careful and use common sense then it’s a safe transaction.  But you still have to be very cautious buying a vehicle online.  You need to be suspicious of any unusual behavior and any strange requests.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Credit Monitoring, Financial, Getting Credit, Identity Theft, Money & Identity

This post was written by John Ulzheimer