BBB Warns Car Shoppers
about Online Dealer Scam
Victims lose thousands to scammers posing as
July 1, 2010 – Grand Rapids, MI - The Better Business Bureau is warning car shoppers to beware of websites offering too-good-to-be-true deals on repossessed cars. The BBB has heard from people across the country who thought they were buying from a reputable dealer online but were actually sending money to scammers posing as legitimate, already established community dealerships.
“Because scammers essentially steal the identity and good name of real auto dealers, car shoppers will think that they’re buying a car from a reputable business,” said Ken Vander Meeden, President of the BBB Serving Western Michigan. “The truth is, they’re being sold a bill of goods by a coordinated, agile and in all likelihood overseas outfit of scammers.”
Most recently, one Memphis auto dealer, America Auto Sales (www.memphisautoworld.com), received more than 1,000 calls from consumers across the country who had shopped for a new car on www.americautosales.com thinking that it was the website of the Memphis dealership. The phony website used the name, address and contact information of the real dealer.
The fraudulent website claimed to sell repossessed cars at prices well below market. Buyers were instructed to wire a deposit - as much as $5,000 - to an individual rather than the company, which, according to the phony website, “helps us avoid taxes legally.” The balance was to be paid upon delivery at the consumer’s address within five days.
After paying the deposit, victims called the real dealership to arrange delivery of their car. Some customers even showed up at the lot to pick up the cars they had “bought” on the bogus site.
Similar websites have posed as many different dealers in Colorado, Florida, Georgia, Michigan, New Mexico and Texas. The websites are often taken down after a few days only to crop up shortly thereafter under a different URL address and under the auspices of another legitimate dealer.
The BBB recommends that car shoppers look for the following red flags when shopping for a car online:
• The prices are too good to be true.
• The dealer only communicates through chat or email - never by phone.
• The dealer only accepts payment by money wire transfer.
If you have been the victim of a fraudulent auto dealer online, notify your BBB at www.bbb.org and the Internet Crime Center at www.ic3.gov to file a complaint.
Old Scams, New Delivery,
The BBBs have seen an increase of old scams involving Nigerian British lottery winners and registrations.
Nigerian Scam Twist - Now claims former contacts were a scam but an individual actually got money by going to Nigeria and working directly with “Barrister Johnson” who is an honest Nigerian contact and helped her retrieve the Nigerian millions promised earlier for only a $328.00 fee.
Registrations - “Your mail box is full” and you need to “click here” to validate your account; be it an email address; bank account, credit card or whatever else. Upon clicking here, your confidential information; passwords, etc. are exposed for other scams. Your email is compromised; your email addresses are then used to send a “crisis” email to your friends asking for emergency funds as you are stranded in England, Canada, Germany or wherever. Of course, this is false, but friends help friends who are traveling, stranded, robbed or falsely arrested in a foreign country. The email asks for money via Western Union or a Money Gram, which once sent is never recovered.
Directory - Fake “bills” use to appear to businesses as an annual directory listing. Now they appear as a fake “trademark registration” or web address registration, both of which are important to businesses in a global marketplace. Offers might even say “solicitation” in very small print but looks very real when printed out and sent to accounts payable with a deadline date to pay by “cheque”.
Investigate before you INVEST. Verify. Verify.