In Australia, May 15-19 is National Consumer Fraud Week which aims to raise awareness and help people spot online scams.
With the process of buying and selling a car representing a prime opportunity for fraudsters and scammers to try and swindle you out of your cash, HelloCars have put together a list of the top red flags to avoid when trying to buy or sell a car online.
Fake transaction confirmations
Sometimes a buyer can seem genuine even right up to payment. In this scam, you will receive a fake transaction receipt via email – usually purporting to be from PayPal – but with the caveat that you need to make a deposit to a third-party to release the funds, usually under the guise that they are a money-transfer provider. To sell the ruse, scammers will often increase their ‘payment’ but the required deposit amount to form the illusion that you will get your money back instantly.
A phishing scam (pronounced ‘fishing’) is where a fraudster tries to trick the victim into divulging personal information such as bank details or passwords by posing as a well-known organization such as a bank or insurance company. In this method, the victim might receive an email or SMS requesting personal information. Sometimes this scam can even include a ‘ghost website’ which mimics the official company website – when you try to log in, your information is stolen.
There are some simply methods you can use to identify a phishing scam. Check the details of the sender – their email address, phone number or URL can all provide clues as to whether it is a genuine source. The simplest solution is that a legitimate organization would never ask you to divulge your personal information.
If you have any doubts, contact the organization directly that the communication supposedly originates from to confirm whether it is genuine.
Like the false transaction scams, in this ruse a potential buyer will ‘accidentally’ pay too much for your car and ask you to refund the difference. Usually they will back this claim up with a fake PayPal transaction receipt and claim that they won’t release the funds to you until you refund the extra amount.
Overseas seller scams
It’s not only sellers that can fall victim to a scam, buyers are also in the sights of fraudsters. In this scam, a fake listing is published to a car sales website with a description that the buyer is currently overseas and needs to sell the car urgently to pay for medical expenses, a funeral or any other number of sympathetic reasons. This is usually accompanied by a car at a price way too good to refuse.
Some fraudsters even go as far as posing as a soldier currently on deployment to make the story more convincing. The buyer is usually required to pay for the car using a money transfer service such as Western Union, then once the payments clear the seller disappears.