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Buying A Car Online Can Be Risky

October 31, 2006
The Internet has made shopping for a car, and even buying a car, a lot easier. Sites like Autotrader.com and eBay put sellers in touch with buyers, and thousands of transactions take place without incident. But it's easy to get scammed.

The Federal Citizen Information Center says it has received a significant number of recent complaints regarding Internet auction fraud involving the sale of automobiles purported to be located outside of the United States.

The typical fraud involves an auction for a vehicle said to be in Europe, and for which the buyer pays with Western Union or other wire transfer mechanism. The buyer does not receive his or her automobile in these auctions, and the money is not recoverable.

Is buying a car online at all a good idea? It can be, the agency says, but only if consumers do considerable research beforehand. Buying a car located outside the U.S., however, is fraught with risk.

"Unless the dealer selling the automobile is personally known to the buyer as being reputable and the money transfer is handled through a legitimate escrow service, there is a high risk involved in engaging in a purchase," the agency says.

Automobile shoppers are also cautioned to be wary of "second chance auctions" and other schemes in which a "seller" of a vehicle e-mails a potential buyer to inform the buyer the high bidder on the auction defaulted and the vehicle can be purchased by the buyer at his or her previous bid or at a discount. This tactic has been used in many auto auction frauds.

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