Online auction scams are prevalent

A relatively recent scam preys upon those who buy used vehicles online. Whether you are shopping on eBay Motors, AutoTrader or Yahoo! Motors, you are at risk. 

More below.

Wire transfer scams are common with online auto sales

A huge and surprising success on the Internet has been the sale of motor vehicles. Sites such as eBay Motors have been quite successful offering cars, trucks, motorcycles and recreational vehicles for sale to the public. It seems odd that such a system would work; it does not allow potential buyers to “kick the tires” before purchase. Nevertheless, the sites seem to be doing quite well, as do those who sell cars for a living.

A growing concern among those who buy and sell on such sites is the increasing amount of fraud. The typical scenario goes like this:

A seller offers a vehicle for sale with a starting price or a Buy It Now price that seems to good to be true. Perhaps the vehicle is one that usually sells for $25,000, but the price is $15,000. Or the minimum bid is only $1000 with no reserve price. The seller will often state that the vehicle is in Europe, but that they have friends in the shipping industry and that they will pay to have the vehicle shipped. You look at their feedback and see that they have a history of five hundred successful transactions. So you go ahead and buy. Then they tell you that you must pay by Western Union wire transfer. You do, and they take the money and you never hear from them again.

What happened? For starters, the seller was probably using a stolen eBay account. This is common as many eBay users have easy to guess passwords and eBay does not block users when they have multiple access failures. So, criminals can set up software programs that attack accounts until they “crack” the password. Then the crook logs in, changes the password, and attempts to sell something using the victim’s username, password and transaction history.

• The wire transfer can be picked up absolutely anywhere that Western Union has an office. The transfer is untraceable. Once the crook takes the money, they, and the money, are gone.
• What can you do? Be careful when you shop online and check the following:
• Where is the seller? Where is the item for sale? If you live in the United States and the vehicle is elsewhere, be suspicious. Be even more suspicious if the seller offers to ship the vehicle. Doing so is very expensive.
• Look at photos of the item for sale. Often, such photos are stock pictures or even photos from brochures, and not photos of any actual item that the seller has “in hand.”
• Do not accept any offers of escrow from the seller. Many such offers are bogus.
• Do not, ever, pay using Western Union or any other untraceable wire transfer mechanism.
• Don’t just look at number of the seller’s previous transactions, actually look at them to see what sort of transactions they were. If the seller is offering a Porsche for sale but all of their previous transactions suggest that they only collect sewing thimbles and never sell anything, you should be suspicious.

Buying and selling cars online is a great business and a terrific way to shop. But buyers should be aware that there is a lot of fraud out there. Be careful.

If you own a car, van or truck, you should protect your investment. Auto insurance can be steep, but why pay a lot if you don't have to? InsureMe can submit a quick estimate from an insurance company in your city at a price that is competitive.