Buyers beware! Purchasing a used car online can be a daunting task these days. For every legitimate website that really does provide useful services and processes, there are multiple sites promising similar services that are complete ripoffs. The problem is that many of these ripoff sites are exact copies of the legitimate sites. The idea is to confuse the consumer into feeling secure. If the sight looks legit the company must be legit, right? Wrong. Let’s take a look at the scams prevalent today in the world of online used car buying, and examine how they work. Imitation is the Sincerest Form of Flattery To the individual, imitation does often equal high praise, even if it is annoying to some degree. To websites legitimately selling used cars, and to sites offering services such as fraud protection and escrow, imitation can mean major trouble for consumers. As unethical as it is, it happens all the time. A major problem in the online community is people copying legitimate websites, then using the brand name and site structure of the real website to gain consumer trust and ultimately scam them out of their hard-earned money.
The scam works something like this. The criminal interested in setting up the bogus site will register the IP address under a stolen identity, or perhaps even the identity of a deceased individual. The host that is providing the domain name has no good process for checking the complete validity of the person and their actual identity. The Internet is simply too good of a hiding place for criminals to catch them all. So the domain name is issued and off we go. The criminal then often proceeds to create a site that is identical to a legitimate, well-known business site. Most of the pages, the pictures; all the bells and whistles of the real site are the same.
Beware the Fake Listing
So how do these criminals actually attract traffic to their fake website? Good question, but the answer is fairly simple. For used cars and car escrow services, they do it through fake vehicle listings and follow-up emails. The crook copies the photos, VIN and description of a real used car for sale and creates a false copy of that car for sale at a below-market price. That fake listing is the lure to get you interested. The fake listing is put on major websites like AutoTrader, Ebay, Cars.com, Craigslist and others. Buyers are drawn in by the low price and typically contact the seller via email. Boom- the criminal now has your email address.
As we all know, our personal emails float around like there is no tomorrow. Just last week I received an email letting me know that I had won the British Lottery. “Sweet!” I thought- I don’t even remember playing! Obviously it was a scam, but I use that to illustrate that my email address and your email addresses are out there. Way out there. So these scammers send out emails, and lots of them.
For used cars, the crooks typically create a fake escrow or shipping service. When you inquire about that cheap car, the crooks will send you more photos, more detail, whatever you want (remember, they stole all of the information from a real listing). They just want to get you interested enough to use their fake service. The con artist will send you an email with a link to the website of this fake escrow or shipping service. They want you to believe that their fake website is the real thing. If it looks real, you are more likely to send money or provide personal information.
Often, emails from the crooked seller will contain service descriptions, testimonials, screen shots of the fake website, and a link that will take you to the fake website. Many times the link takes the duped consumer straight to a form, with questions asking basic personal information and also questions to determine what services they may be interested in.
The “Follow Up”
A few minutes or hours later, another email is generated to the consumer. Getting this second email often falsely eases the mind of the recipient, as many less sophisticated ripoff sites just try to get you to the site once and you never hear from them again. These criminals I write about are more advanced, and they know the mind of the consumer.
The second email may be somewhat personalized, using the consumer’s name, and also providing instructions on what to do to secure the services of interest from the survey filled out on the website upon first visit. An example is a site offering an escrow service for online car purchases. The escrow service is one that will act as an intermediary to hold an initial payment on a car until you the consumer actually receives the car you are purchasing. Maybe it is $1000, maybe it is $5000, depending on the car price and the amount requested by the seller. These fake sites often tell the reader in the email that the first transaction made with the website must be through Western Union, Moneygram, or another commonly known method of moving money from your bank account to the site’s escrow account for holding. Even bank wires, which used to be a safe way to transfer money, are now used by these crooks. They illegally access bank accounts through stolen identities. Since, at this point, everything about the site and the method to send money seems legitimate the consumer will not hesitate to send the deposit in good faith.
This is the last time the unwitting consumer will see his or her money, as well as the last time the site will initiate any type of communication. Usually, the consumer grows frustrated or gets concerned about the lack of correspondence. Deciding to take action, the consumer calls the service phone number on the website, if a number is even listed. Sometimes the number listed is the number for the real company, which of course will have no record of any transaction or any record of the person that made the transaction. As bad as the person at the real company may feel about the situation, there is nothing they can do to help.
Another tip regarding phone numbers: If you call a number from a website and you hear several clicks before the ringing begins, the call is being redirected to a different number. This is often the case with numbers shown on the fake websites. If you do reach the legitimate company, there will be nothing they can do for you other than to sympathize with your situation. While that is nice, it’s not going to help you get your money back!
It comes down to this - if you are referred to an escrow or shipping company by a car seller, it is a good idea to call the number listed, speak with a representative, and request information to be sent to you, with the conversation referenced in the email message or mail correspondence. You can also use online resources such as www.escrow-fraud.com, which provides a list of real car escrow services and known fake ones.
Possible Recourse
Oftentimes these scams originate in another country, making it even tougher for US law to crack down on them. The FBI, through their Internet Crime Complaint Center (IC3) created a website to accept and track complaints relating to Internet fraud. Their website, www.ic3.gov, registered over 200,000 complaints in 2006 alone. If you are a victim of Internet fraud, file a complaint on the IC3 website, and provide as much detail as possible about your encounter.
ICANN, the International Corporation for Assigned Names and Numbers, is a not-for-profit organization created in 1998 to help keep the Internet secure and stable. However, even ICANN states on their own website that they do not control Internet content, cannot stop spam, and do not deal with Internet access. In short, even they will not be of much assistance to you should you find yourself the victim of a scam similar to what has been discussed here. It can cost as much as $3500 to file a formal complaint with ICANN, which is a hefty amount, especially if you have just lost money. On top of this, a court order is often needed to have a site removed from the online community, but even a court order may be of no use if the identity used to start the website is stolen or belongs to a deceased individual. If you are unable to locate the person who committed the fraud, no recourse may be available.
Securing Your Online Purchase
The bottom line is to do your homework. You simply cannot trust everything that you see online. Ask for references from friends who have used online services to purchase vehicles. Contact the business before you use them, and ask them for all of the phone numbers for the business, plus a physical address. Verify the physical address (visit them if feasible) and do diligent research. If a company is running a scam, odds are you aren’t their first target or first victim. Look for blogs, online forums, or reviews that may alert you to the same scam that just landed in your inbox. The real companies are suffering too, as often their name is dragged through the mud because their site has been copied and illegally used to bilk people out of thousands of dollars. Find a trusted company, look for the signs of a ripoff described above, and avoid your own horror story when it comes to your next online car purchase.
