The Truth About Cars » scam http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Tue, 21 Oct 2014 18:05:29 +0000 en-US hourly 1 http://wordpress.org/?v=4.0 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » scam http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Piston Slap: Because Nobody Lies on Craigslist! http://www.thetruthaboutcars.com/2013/08/piston-slap-because-nobody-lies-on-craigslist/ http://www.thetruthaboutcars.com/2013/08/piston-slap-because-nobody-lies-on-craigslist/#comments Wed, 07 Aug 2013 12:07:54 +0000 http://www.thetruthaboutcars.com/?p=498201 Walt writes: Mr. Mehta, I am seriously considering purchasing a 1965 Mustang Fastback from a private seller on craigslist. He owes $3000 on the vehicle. I myself will have to take out a loan to pay for said car. The title to the car is held by the same institution that will be lending me […]

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Walt writes:

Mr. Mehta,

I am seriously considering purchasing a 1965 Mustang Fastback from a private seller on craigslist. He owes $3000 on the vehicle. I myself will have to take out a loan to pay for said car. The title to the car is held by the same institution that will be lending me the money. The situation is somewhat further complicated because this institution has no local branches to sit down with a representative and the current payer on the car to do the necessary paperwork. Compounding the issue is the fact that I live in a different state, 200 miles from the car’s location.

Bottom line, I would like to know how to go about this to achieve these objectives:

— My money goes to the rightful person or institution
— I get the proper paperwork to take possession of the vehicle
— The seller is legally compelled and bound to sign the title over to me when I have paid my loan
— I minimize my trips to and from the car’s location

This is my first ever car purchase (worry not, I own another reliable car) so please let me know if I have my facts wrong about the process. Provided these circumstances are not completely heinous and indicative of a potentially bad situation for me, I would like to move forward with my purchase.

Sajeev answers:

OMG…did I really just read that?

Everything here sounds like a unique twist on the typical craigslist scam. If you can’t get a trustworthy, third-party local to sort out this complete Charlie Foxtrot, run like hell. I see nothing worth pursuing in your letter…and not just because I think Fox Mustangs are better than any Pony Car from the 1960s.

And FWIW, needing a loan to buy a classic money pit is a horrible idea. And that’s putting it mildly! If you can’t afford it now, how on earth can you afford the repairs that will come sooner rather than later?  Everything can and will go bad, even the new parts you put on could be defective…it happens all the time!

Come on, Son! Even if the craigslist seller is on the level, you have to pass this one up until your savings account matches your passion for antique vehicles.

(Offline Update from Walt: In the end I decided to pass on the car.  Too much money and too much of a hassle for what was being offered.  I read TTAC daily and enjoy your articles, so keep up the good work!) 

 

Send your queries to sajeev@thetruthaboutcars.com. Spare no details and ask for a speedy resolution if you’re in a hurry…but be realistic, and use your make/model specific forums instead of TTAC for more timely advice. 

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Tales From The Cooler: The Land Of The Crooked Car Buyer – Part One http://www.thetruthaboutcars.com/2012/12/tales-from-the-cooler-the-land-of-the-crooked-car-buyer-part-one/ http://www.thetruthaboutcars.com/2012/12/tales-from-the-cooler-the-land-of-the-crooked-car-buyer-part-one/#comments Thu, 20 Dec 2012 14:53:10 +0000 http://www.thetruthaboutcars.com/?p=470611   I recently stood on the showroom floor of a Los Angeles-area luxury car dealership as their sales manager pointed out a middle-aged couple browsing the lot. “We will never sell them a car,” he said. “In fact, we are going to politely ask them to leave.” Why? “One of our salespeople recognized them. They […]

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I recently stood on the showroom floor of a Los Angeles-area luxury car dealership as their sales manager pointed out a middle-aged couple browsing the lot. “We will never sell them a car,” he said. “In fact, we are going to politely ask them to leave.” Why? “One of our salespeople recognized them. They are professional Lemon Law scammers. They have hit two other dealers but they are not going to hit us.”

Welcome to Southern California where car buyers are often criminals, ripping off automakers and their captive finance arms to the tune of over $50M a year. These sophisticated white-collar crooks are skilled at using fraudulent means to obtain a vehicle, such as ID theft or sub-leasing cons, or by using fraudulent means to dispose of a vehicle, such as engineering bogus Lemon Law claims or by rolling back a car’s odometer to avoid lease-end excess-mileage charges.

The targeted vehicles are almost exclusively from Audi, BMW, Lexus, Mercedes-Benz and Porsche brands. These automakers and their banks report that around 50% of their fraud cases nationwide occur in Southern California. The Los Angeles melting pot attracts the best and worst class of people, including some clever organized crime groups. Add to this the perception that you are nobody if you are not driving the latest luxomobile in LA and I say you got Trouble in RX City. It is said that all automotive trends start in Southern California and consumers defrauding automakers is one of them.

Some of the outlaws are extremely adept at their chosen crimes and some are hilariously inept. In Part One of Two installments in this exclusive series we will look at the car disposal criminals, starting with a scheme currently sweeping the Southland: The Lemon Law Scam.

In the past, only folks who fell on hard times and were behind on their car’s lease payments would attempt this rip-off; now bandits plan the gambit upfront as a means to drive a new luxury car every year. These unethical individuals also boast high credit scores; in other words they are a bank’s worst nightmare.

The con works like this: go lease a high-end automobile for the longest term, the least miles and lowest down payment you can negotiate. For example, you can lease a 2013 BMW 535i for 39 months at 10,000 miles per year for as little as $585 per month with a few hundred dollars down for title, and license fees. That’s a cut-rate payment for a $55,000 ride and you are now cruising Colorado Boulevard in style.

Enjoy driving your Beemer for a year or so or until you decide you want the latest Lexus. At this point you are buried in your lease deeper than Jimmy Hoffa as it would cost mega-thousands of dollars over the value of the vehicle to pay off the contract.

It is now time for the twist: you or a technician friend tamper with the mechanics of the car to make it eligible to be a Lemon Law buyback for being unrepairable. In California, a defect that cannot be repaired in as little as two visits to the dealer, or if the vehicle is in the shop over 30 days, can be eligible for Lemon Law status. Thus, a stuck dashboard warning light, a balky seat belt buckle or leaking brake fluid can make you the poor victim of the evil carmaker. All it takes is a little tinkering.

Next, hire one of scores of LA lawyers like this one who specialize in Lemon Law cases. Under the threat of a lawsuit, the attorney will negotiate with BMW of North America for them to buy your car back and pay off the lease and will often score a few extra dollars for your “hardship.” Once the case is settled, you head over to your local Lexus store and repeat the process.

One Lemon Law attorney discusses the tampering issue on his website but does not specifically discourage the practice:

…OWNERS BEWARE! What consumer’s don’t know is what the car manufacturer’s DO know about owners tampering with their vehicle’s to “create” a California Lemon Law case…Typical “tampering” of cars include repeated incidents of dash warning lights for various vehicle systems, including, but not limited to: SRS/airbag, “CHECK ENGINE”, traction control, brakes, ABS, and more…Making matters even MORE serious, auto dealers now have special “tamper-seal” for electrical connectors and devices that are invisible to the eye. The newest generation even has a “imprint” film, that takes fingerprints…

The lawyer’s assessment of automakers’ countermeasures is a few years out of date. The latest defense tactics must not be revealed here as the crooks no doubt have Google Alerts set for the words, “tamper” and “Lemon Law.”

Customers caught tampering with their cars find their claims denied and are advised to never set foot in that brand’s dealerships again. Like with most fraud, prosecution by carmakers or their banks is uncommon – accusing a car owner of fraud and losing the case would result in a public relations disaster.

Odometer Fraud

Before we discuss the Angelenos who roll back their odometers to defraud automakers, allow us to make this statement:

America is losing the war on odometer fraud and the situation is growing worse.

The National Highway Traffic Safety Administration has been claiming since 2002 that there are 450,000 cases of odometer tampering annually in the United States, while CarFax reports the number of instances has jumped 57% in the past four years. Contrast this with the fact that less than 20 people per year are actually convicted of the crime and this indicates that the enforcement of odometer laws is not a priority with state and federal agencies.

The vast majority of people apprehended for odometer fraud are either individuals or owners of independent used car lots. Most of the clockers caught are either still plying their trade like this man or receive a slap on the wrist like this dealer. The latter, who also covered some odometers with electrical tape to fool buyers, has been allowed by the court to return to the wholesale car business.

Speaking of dumb criminals, this father and son team from Florida would never make it in California – their placing fliers on vehicles at an auction offering their “odometer services” was incredibly dim-witted and not up to the sophisticated standards of Southland scammers.

The recent explosion in the number of odometer fraud cases can be directly tied to the easy availability of digital odometer rollback devices. For a few hundred dollars, anyone can buy a “mileage correction” contraption from a number of firms on the Internet, even on eBay and amazon.com. The so-called “CAN” device below is offered by a company in China:

 

“BENZ CAN Filter By installing this small pcb inside the EIS module, you can make mileage corrections on NEW MB cars of w221/w164/w204/w212……, and scanner can not find original mileage from EIS module”

Makers of these devices claim their tools can fool a car’s Engine Information System (EIS), thus making the mileage adjustment permanently undetectable; the automakers claim this is not true – at least that is what they say publicly.

Our Los Angeles dodgers plot their ploy upfront, much like the Lemon Law liars. They are high-mileage drivers, but enter into a low-mileage lease to get the cheapest possible payment. On most brands this means 10,000 miles per year, though Mercedes-Benz Financial offers 7,500 mile leases, making them more vulnerable to this scheme.

During the term of their lease, the lessees never have their car serviced at a dealership or shop that will record their odometer reading, thus outfoxing CarFax and the bank. By reversing their odometers prior to lease end, the offenders will then not be charged excess mileage penalties by the bank, which is typically 25 cents per mile. Thus on a three-year term a scammer can avoid $7,500 in charges based on driving 20,000 miles per year on a 10,000 mile lease.

One luxury automaker’s captive finance arm recently filed the rare lawsuit against a customer, accusing him of clocking his odometer just before the termination of his lease. The defendant lives in the city of Glendale, considered by automakers to be the epicenter of fraud in Southern California. In this closely-watched case, the bank is more interested in sending a message to the tight-knit criminal community rather than recouping the thousand of dollars in diminished value of the car.

Stay tuned for Part Two of our series on LA’s conniving auto buyers, where we will explore identity theft, sub-leasing, crooked auto brokers, and how you can obtain your very own parts car for free.

It is never boring being in the automobile business here in the City of Anglers…

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Hammer Time: The Return Of The 1967 Arabs! http://www.thetruthaboutcars.com/2012/09/hammer-time-the-return-of-the-1967-arabs/ http://www.thetruthaboutcars.com/2012/09/hammer-time-the-return-of-the-1967-arabs/#comments Mon, 03 Sep 2012 16:19:23 +0000 http://www.thetruthaboutcars.com/?p=458829 9:15 A.M. Labor Day. I get a surprise message on Facebook this morning from a guy who bought an old Volvo 940 wagon from me nearly six years ago. “That BMW? What did it go for?” A month ago, I posted this article regarding the grey market Bimmer.  It had sold on the block for […]

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9:15 A.M. Labor Day.

I get a surprise message on Facebook this morning from a guy who bought an old Volvo 940 wagon from me nearly six years ago.

That BMW? What did it go for?”

A month ago, I posted this article regarding the grey market Bimmer.  It had sold on the block for a mere $2,300 due in part to a broken odometer. I clicked on the Ebay listing hoping for a fair disclosure. Instead I got…

No disclosure of the fact that Carmax had sold it earlier as, “Not Actual Miles” and “Odometer Inop”.

A 16 digit VIN listed instead of the actual VIN number on the vehicle.

From my side of the fence, it’s the dealer that bears the responsibility of telling their audience about any title and mileage issues. It can be a tricky line in our professional world.

Some folks are not willing to hear out anything that someone else may have done in error. The 16 digit VIN listed on this vehicle’s title is obviously not correct. Go to the last picture, and you’ll see that the 10th digit of the VIN is without an ‘H’ that signifies a 1987 model and that the title lists this vehicle as having 6 cylinders, which is also incorrect.

However these were just two small ingredients in the recipe of mistakes and omissions. When I checked for the databases I use for vehicle histories, nothing popped up. I did find out through this decoder that the vehicle was actually produced in September 1986. But inserting a ‘G’ as the 10th digit generations nothing.

As someone who has traveled the country liquidating 10,000 vehicles a year, and even bought grey market cars, I can’t say I have ever seen anything quite like this. 16 digits on the title? A close-up of the VIN on the vehicle would add wonders to this seller’s audience, and perhaps their ability to verify the miles.

Mileage issues are nothing new in the world that is older used cars. Dealer auctions sometimes have to deal with sellers who think that an exempt car, a car that is 10 years or older, doesn’t have to have known mileage issues disclosed.

They do. It’s required by law.  Though I don’t believe the folks at Bring A Trailer have anything but the best of intentions for classic car enthusiasts, at least now they have an extra incentive to verify VIN numbers when the opportunity to do so is there.

They have been contacted and hopefully their article and the Ebay listing will be amended.

This saga brings on a more personal question. What was the most misrepresented vehicle you ever saw in your life? Sometimes auctions will get the details wrong as we witnessed in the earlier post about this car. Some of them will go through thousands of cars over the course of the year, so that’s understandable.

But a guy who bought and kept a car like this with ‘True Miles Unknown’ announced on the block, and written on the bill of sale? So many unusual coincidences in one listing? What says you?

Special thanks to John Dillingham, a long-time fellow brick enthusiast and all around good guy, for tracking down the listing. 

 

 

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Consumer Alert: Beware Online Car-Selling Scams http://www.thetruthaboutcars.com/2011/08/consumer-alert-beware-online-car-selling-scams/ http://www.thetruthaboutcars.com/2011/08/consumer-alert-beware-online-car-selling-scams/#comments Tue, 16 Aug 2011 15:04:10 +0000 http://www.thetruthaboutcars.com/?p=407379 The International Crime Complaint Center (IC3) warns that Online vehicle shoppers are being victimized by fraudulent vehicle sales and false claims of vehicle protection (VPP) programs… Criminals also attempt to make their scams appear valid by misusing the names of reputable companies and programs. These criminals have no association with these companies and their schemes give […]

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The International Crime Complaint Center (IC3) warns that

Online vehicle shoppers are being victimized by fraudulent vehicle sales and false claims of vehicle protection (VPP) programs… Criminals also attempt to make their scams appear valid by misusing the names of reputable companies and programs. These criminals have no association with these companies and their schemes give buyers instructions which fail to adhere to the rules and restrictions of any legitimate program. For example, the eBay Motors Vehicle Protection Plan (VPP) is a reputable protection program whose name is commonly misused by these criminals. However, the VPP is not applicable to transactions that originate outside of eBay Motors, and it prohibits wire transfer payments. Nevertheless, criminals often promise eBay Motors VPP protections for non-eBay Motors purchases, and instruct victims to pay via Western Union or MoneyGram.

No wonder online new car sales have been struggling. Hit the jump for IC3’s list of warning signs.

According to the center’s release, buyers should beware

  • Sellers who want to move the transaction from one platform to another (for example, Craigslist to eBay Motors).
  • Sellers who claim that a buyer protection program offered by a major Internet company covers an auto transaction conducted outside that company’s site.
  • Sellers who push for speedy completion of the transaction and request payments via quick wire transfer payment systems.
  • Sellers who refuse to meet in person, or refuse to allow the buyer to physically inspect the vehicle before the purchase.
  • Transactions where the seller and vehicle are in different locations. Criminals often claim to have been transferred for work reasons, deployed by the military, or moved because of a family circumstance, and could not take the vehicle with them.
  • Vehicles advertised at well below their market value. Remember, if it looks too good to be true, it probably is.

The LA Times reports that scammers recently used and Edmunds.com lookalike page to defraud online car buyers. Keep a watchful eye on all online auto sellers, and be sure to report any attempts of fraud to local law enforcement, the IC3 and, if you want to take justice into your own hands, write up your experience for TTAC. To defeat scammers, we all need to pull together.

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Judges Made Unwitting Accessories In Beijing License Plate Scam http://www.thetruthaboutcars.com/2011/02/judges-made-unwitting-accessories-in-beijing-license-plate-scam/ http://www.thetruthaboutcars.com/2011/02/judges-made-unwitting-accessories-in-beijing-license-plate-scam/#comments Thu, 17 Feb 2011 11:39:25 +0000 http://www.thetruthaboutcars.com/?p=384177 Beijing’s draconian license plate limits have a stimulating effect on the creativity of Beijingers. To skirt the new rules, complex schemes are being devised. Beijing’s courts are turned into accessories of the fraud. According to China Daily, the scheme goes like this: The seller and buyer of a used car invent a debt the vehicle’s […]

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Beijing’s draconian license plate limits have a stimulating effect on the creativity of Beijingers. To skirt the new rules, complex schemes are being devised. Beijing’s courts are turned into accessories of the fraud. According to China Daily, the scheme goes like this:

The seller and buyer of a used car invent a debt the vehicle’s seller supposedly “owes” the buyer for which the car is “collateral”. Both go to court.  The court  orders the “debtor” (the car’s seller) to hand over the car to the “lender” (the car’s buyer). Along with the transfer of the car’s ownership comes the already registered license plate. Bingo.

Under the new rulings, registered owners of a car can buy a new one without being submitted to the license plate limitations. However, the plate does not transfer with the used car. As a result, Beijing’s second had car market pretty much collapsed in January. In the tough rules is an exception for the registration of cars’ ownership transfers through court adjudications, or property transfers related to marriages and inheritances. False marriages with car owners will probably rise also. Adoption and subsequent death might prove as too complicated.

“Such stipulations provide loopholes for used car buyers to avoid legitimate channels,” said Zhu Xingdong, a senior staff member of the people’s court of Beijing’s Huairou district. He said it’s tough for the courts to determine that the debts are legit, because the two parties have colluded in supplying watertight debt and reimbursement agreements. “If it is found to enable people to get around the lottery to obtain license plates, there will be a surge in these cases,” Zhu predicted.

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