Because of the new car shortage, the average price of used cars is at an all-time high. That means used car shoppers who find an online listing for a late model used car at a 2019 price might be tempted to jump on it.
But wait – anyone who is selling a car is undoubtedly aware of its current value. Why would they advertise it for less?
The simple answer is that a legitimate seller wouldn’t do that. However, scammers are reportedly posting these fake listings for cars that don't actually exist as a way to steal money from consumers.
Increase in fraudulent sales
The Better Business Bureau (BBB) recently released a report that noted an increase in fraudulent online used car sales. The vehicles are usually advertised on platforms like Craigslist, Facebook Marketplace, or eBay. The listings usually come with a picture and a description of the car at an amazing price.
With the rise of online auto sales platforms like Vroom and Carvana, consumers are more accustomed to this type of sales process. Buyers may be lulled into thinking that the vehicle they see in the online post is legitimate.
The scam starts when a buyer contacts the scammer/seller to inquire about the listing. The scammer then tells the victim that the car is in another city and recommends that they use a certain auto transport company to deliver it. This may seem perfectly reasonable since so many legitimate transactions through established dealers have been conducted this way since the start of the pandemic.
The buyer is told to wire a transport fee to the transport company – which doesn’t actually exist. They are told the funds will be held in escrow until the vehicle is delivered. If the buyer wires the funds, the car never arrives. Because they wired the money or used a preloaded money card, their money can’t be retrieved or traced.
What to do
If the advertised price is thousands of dollars less than the market value, that's a sign that you might be dealing with a scammer. Consumers should try to talk to the seller on the phone. If the seller insists on only communicating by email or text, that’s another big red flag.
Finally, you should see the car or truck before any money changes hands. While most Vroom and Carvana sales transactions go off without a hitch without the buyer inspecting the vehicle, those are established companies. If you are dealing with an individual or a company you’ve never heard of, there should be much less trust.