Beware of Online Scams

Online scams routinely target Ontario car buyers through fake ads found on popular websites such as Kijiji, AutoTRADER and Craigslist. The ads generally appear to have been placed by private sellers, but when the consumer calls they’re told the seller has relocated and the car is in storage (or someplace similar but inaccessible), or that the seller is actually a dealership located in the U.S. The problem is, the seller/dealership and vehicles aren’t real.

In the case of fake dealerships, the scammers go to great lengths to deceive by creating professional looking websites containing extensive inventory and convincing customer testimonials. In many instances the webpage content has actually been stolen from legitimate dealerships. When OMVIC has focused public attention on some fake U.S. dealerships, the websites were immediately taken down, only to reappear weeks later under a new name.

Unfortunately, due to the international multi-jurisdictional nature of these online scams, investigations and prosecutions are quite difficult.

Signs You May be Dealing With a Scam Artist

When buying a vehicle online, OMVIC reminds consumers to remain vigilant and protect themselves by watching for some of the telltale signs of a scam:

• The advertisement is posted locally, but the vehicle is located a long distance away.
• There are excuses why an inspection of the vehicle isn’t possible (e.g. seller has relocated so vehicle is located in a storage/secure compound, military base, etc.).
• The seller agrees to ship the vehicle to you with a money-back guarantee. Don’t trust that the seller will follow through with this promise or that a trust or escrow account is real.
• Pictures don’t reflect the season or the locale. Look for signs in the advertisement’s picture(s) that indicate the vehicle’s location, like leaves on trees or snow (when there should/shouldn’t be any), palm trees, tropical plants. Also, what licence plates are on the vehicle in the pictures? If none, why not? When in doubt, ask the seller to provide a specific photograph of the vehicle – perhaps one with that day’s newspaper in it.
• The vehicle is priced below market value. If a price seems too good to be true, it’s a warning not an opportunity.

Car-Buying Tips

When purchasing a motor vehicle in Ontario, you are only protected by Ontario’s consumer protection laws, and have access to the Motor Vehicle Dealers Compensation Fund when you buy from an OMVIC-Registered Dealer. To avoid falling victim to an online car-buying scam – consider the following:

• Beware of vehicles that cannot be viewed or inspected prior to purchase.
• Travel to see a vehicle located remotely—don’t rely on pictures or a convincing website. If a buyer can’t travel to see the vehicle, hire an appraiser or mechanic to inspect the vehicle. He/she can ensure the vehicle actually exists and the seller is who they claim to be.
• Check with state or provincial regulators/authorities to ensure a dealer is legitimate and properly licensed.
• Purchase a vehicle history report for the vehicle—don’t simply rely on a report provided by the seller, it can be altered.
• Don’t wire money or provide a credit card number without first doing all homework.
• Beware of sellers who want to close the deal as quickly as possible. Take the time to think the purchase through, ask questions and consult with a professional.

Curbsiders

In addition to out-right scams, online marketplaces also provide the perfect venue for curbsiders (illegal, unlicensed dealers), who commonly pose as private sellers to prey on uninformed consumers. Curbsiders not only misrepresent themselves – they often misrepresent the vehicles they sell: many are previous write-offs with undisclosed accident repairs or are odometer-tampered. To learn more about these illegal dealers and how to spot them, click here.