With the internet at our fingertips, making online purchases is as easy as one or two clicks of the mouse. And increasingly, consumers are choosing to buy cars from online ads. However, the Better Business Bureau (BBB) warns that there is a great deal of risk in doing so.
In its most recent annual report, the Internet Crime Center says auto fraud accounts for 12 percent of all online purchase scams, totaling to more than $60 million dollars in losses to consumers.
Most often, the scam works like this; buyers purchase vehicles advertised at a low price by individuals that don’t own them. The scammer generally does not meet the consumer and requires them to pay via wire transfer.
“It’s hard to pass up a good deal, especially on an investment like a car. Consumers need to be extremely cautious because the amount of money they could lose can be sizable,” said Steve J. Bernas, president and CEO of the Better Business Bureau serving Chicago and Northern Illinois. “Reports say that the average amount lost on one of these scams is nearly $4,000.”
The BBB offers the following tips for online car shopping:
- Check the vehicle’s price. Before buying a car, check out a similar make and model’s price on other websites. If the price is way below market value, it’s probably a scam. Be sure to order your own CARFAX report on the vehicle.
- Communicate with the seller. If a seller refuses to meet in person, this is a bad sign. At the very least, discuss the purchase with the seller on the phone to get more information about the person or business. Sellers should also allow the buyer to inspect the vehicle before making payment.
- Be careful with the transaction. Be cautious of transactions in which the seller and the vehicle are in different locations. The seller may claim they are not able to take the car along because of military deployment, moving because of family circumstances, or job relocation. Scammers also try to push for quick payments via wire payment systems, so never send money using this payment method.
- Check the vehicle identification number. When you check out the car, make sure the car’s vehicle identification number (VIN) matches with the number on the paperwork. The VIN can be found on the car’s dashboard on the driver’s side of the vehicle. Make sure the VIN number on the card matches the number on the insurance card, insurance policy and vehicle title and registration.
- Slow down. If a seller says the car will be shipped after payment is received, take the time to research the shipper and contact the transportation company to validate the shipping arrangements.