BBB warns car shoppers about online dealer scam
July 19, 2010
Sierra Vista, AZ -- Personnel from the Better Business Bureau are warning car shoppers to beware of Web sites offering too-good-to-be-true deals on repossessed cars. 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 Kim States, BBB president. "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 Web site of the Memphis dealership. The phony Web site used the name, address and contact information of the real dealer.
The fraudulent Web site 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 Web site, "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 Web sites have posed as many different dealers in Colorado, Florida, Georgia, Michigan, New Mexico and Texas. The Web sites 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.
BBB recommends 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 e-mail-never by phone.
*The dealer only accepts payment by money wire transfer.
If you have been the victim of a fraudulent auto dealer online, file a complaint at www.sierravista.bbb.org, and the Internet Crime Center, www.ic3.gov.