January 2013
Consumer Line
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CONSUMER PROTECTION

Phony Car Dealer Scams Continue to Target Canadian Car Buyers

Ambient Auto Center
Husen Original Autos has been identified as another, in a growing list, of online scams targeting Canadian car buyers.

Husen advertises on online vehicle marketplaces such as AutoTrader.ca, Wheels.ca, E-bay.ca, Craigslist.ca and Kijiji.ca, offering high-end late model vehicles at prices that are often “too good to be true”. The phony dealer’s website claims to be based in Phoenix AZ; however the business does not actually exist: Their advertised address is actually a retired fire hall, now used as a community service building. Husen Original Autos appears to be the latest incarnation of Ambient Auto Center and Sprint Luxury Auto. Both were fake dealerships supposedly based in Oklahoma. Husen’s website looks nearly identical to Ambient’s and Sprint’s and their methods of operation appear to be the same.

OMVIC is aware of six victims of this scam so far: together those victims paid $240,000 for cars that were never delivered. Unfortunately, because of the multi-jurisdictional and international nature of these scams, investigations and prosecutions are difficult and expensive.

OMVIC strongly cautions Ontarians considering buying vehicles remotely, and offers these tips:

  • Don’t do it - consider the savings are probably not worth the gamble, especially in light of the rapid proliferation of these scams.
  • Beware of a price that is considerably lower than the average market price. If a price seems too good to be true, it should be seen as a warning, not an opportunity.
  • Travel to see the vehicle – 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. They can ensure the vehicle actually exists and the seller is who they claim to be.
  • Check with state or provincial regulators/authorities to ensure dealers are licensed.
  • Purchase a vehicle history report for the vehicle – don’t simply rely on a report provided by the seller: they can be altered.
  • Don’t wire money or provide a credit card without first doing all homework.

Ontarians should be aware they are only protected by Ontario’s consumer protection laws and only have access to the Motor Vehicle Dealers Compensation Fund when they buy from an Ontario-registered dealer. If consumers buy privately or outside the province, and something goes wrong, they are basically on their own. It’s simply not worth the risk.

INDUSTRY HEADLINES

Beware: Flood-damaged Vehicles from Superstorm Sandy Now on Their Way to Our Marketplace

 

Flood Damaged Vehicles
Pictured are just some of the 230,000 Sandy cars awaiting salvage auction. (Photo courtesy National Post)

Flood damaged vehicles from Superstorm Sandy are now on the auction block. Some of these vehicles will undoubtedly re-enter the marketplace, including our own.

Over 230,000 vehicles were damaged or destroyed by Superstorm Sandy and recently, salvage auctions in the NE U.S. began selling off the flooded and damaged vehicles on behalf of insurance companies and fleet managers.

OMVIC has reached out to numerous regulatory bodies and industry associations in the U.S. about the disposal of these vehicles and what it could mean to Ontario dealers and consumers (check out this National Post article). Our findings indicate there is a very real potential for serious ramifications, and offers the following tips to avoid the purchase of a Sandy vehicle:

  • Be cautious of vehicles priced below market value.
  • Don’t rely on a ‘clean’ title for a U.S. vehicle.
  • Utilize multiple vehicle history reports.
  • Avoid vehicles previously registered in known areas of flooding.
  • Have a trusted mechanic conduct a thorough physical inspection.

Unfortunately, this will not be a short-term problem. These vehicles will be in the marketplace for years to come.


HAVE YOU HEARD?

Questionable Businesses Prey on Car Sellers

 

Consumers posting ads to sell their car privately on online marketplaces such as AutoTrader.ca, Craigslist.ca or Kijiji.ca may find themselves vulnerable to dubious telemarketing companies. According to a recent British Columbia Better Business Bureau bulletin “these companies are trolling through online ads to find someone to make a quick buck from. Companies often guarantee to sell vehicles quickly and promise a money-back guarantee. Problem is that these guaranteed vehicle brokers rarely sell your vehicle, rarely provide refunds, and only post your own ad to other free online listings - charging you a $500 fee for things you probably could do yourself for free.

Don’t let promises of guaranteed sales persuade you into a costly ad. Never give into verbal promises, and do not provide credit card information until you have a contract that lays out all the terms and conditions”. Good advice.

EXTRAS
- Contact Us
If you have any questions, comments or suggestions for Consumer Line, email us at consumerline@
omvic.on.ca and let us know what you think!

Also, be sure to stop by the OMVIC booth (F600-23) at the Canadian International AutoShow (February 15-24), Metro Toronto Convention Centre!

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Consumer Line is a monthly publication by the Ontario Motor Vehicle Industry Council - OMVIC, and is sent to you because you have requested it. If you have received this e-mail in error, or prefer not to receive more issues, you can unsubscribe at any time by following the link below.

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OMVIC is the self-management organization of the motor vehicle dealer industry and administers the Motor Vehicle Dealers Act -- a public protection statute -- on behalf of the Ministry of Consumer Services. OMVIC's mandate is to maintain a fair and informed marketplace by ensuring registration of motor vehicle dealers and salespeople, regularly inspecting all of Ontario's 8,800 dealerships, maintaining a complaint line for consumers and conducting investigations. OMVIC also administers the Motor Vehicle Dealers Compensation Fund.