December 21, 2012 - Ontario and US Regulators Warn of Another Scam Targeting Car Buyers
Toronto ON, December 21, 2012 - OMVIC, the regulator of motor vehicle sales in Ontario, and the Oklahoma Used Motor Vehicle and Parts Commission (UMVPC), are warning car buyers of yet another online scam specifically targeting Canadians.
According to UMVPC Investigator John Cobb, Sprint Luxury Auto, is advertising on the Canadian sites of AutoTrader, Wheels, E-bay, Craigslist and Kijiji: their ads offer high-end late model vehicles at prices that are often ‘too good to be true’. Cobb states this phony dealer’s website claims to be based in Oklahoma City, however the business does not actually exist: “They are not licensed and they have no physical presence. Their advertised address is actually a call center for Sprint Wireless. This is a blatant attempt to use Sprint’s name and location to gain credibility. Make no mistake, SprintLuxuryAuto.com is a scam”.
Terry O’Keefe, OMVIC Manager of Communications, says this latest fraud is very similar to one that appeared a few weeks ago. That scam involved Ambient Auto Center, also with a supposed address in Oklahoma. “Ambient’s address turned out to be a cornfield” explained O’Keefe. “Unfortunately these are both sophisticated operations. The websites are very professional and contain extensive inventory and convincing customer testimonials”. “We know of five victims of the Ambient scam so far: those victims lost nearly $200,000. We expect there are many more victims yet to come forward”.
According to Cobb within hours of OMVIC’s December 5th news release, warning Canadians about Ambient, the company shut down its website and phones, but it hasn’t taken them long to resurface as Sprint. “Just like cockroaches, when you shine a light on them they scurry away, waiting for a chance to resurface”.
Unfortunately because of the multi-jurisdictional and international nature of these scams, investigations and prosecutions are difficult and expensive. “The scammers know this – it’s why they are targeting Canadians” explains O’Keefe. “The best way to deal with these types of scams is for consumers to be cautious and educated. Recognize that if something is priced below market value, it should be viewed as a warning, not an opportunity”.
OMVIC strongly cautions Ontarians considering buying vehicles remotely, whether privately, or from a dealer in another state or province. Ontarians 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.
The first lesson buyers can learn from Sprint and Ambient is not to buy without confirming the seller and vehicle actually exist and that the vehicle is in the seller’s name. “Buying remotely is a huge gamble” says O’Keefe. “Buyers should travel to see the car and verify the facts. If that’s not possible, hire an appraiser to do it – but don’t wire money or give a credit card number without doing all your homework”. Cobb agrees. “Not only will the victims of these scams lose their money, I’m certain the information they give these scam artists will be used later for attempted identity theft. It’s simply not worth the risk”.
About Motor Vehicle Dealers Compensation Fund:
The Motor Vehicle Dealers Compensation Fund is fully funded by Ontario's registered motor vehicle dealers and provides compensation to consumers who have a valid claim against an Ontario-registered dealer. Qualifying consumers may be eligible to receive up to $45,000 for each valid claim to the Compensation Fund. Since its inception on July 1, 1986, the Compensation Fund has paid out over $5 million to consumers. In 2011, the Compensation Fund celebrates 25 years of providing advanced consumer protection to Ontarians.
The Ontario Motor Vehicle Industry Council (OMVIC) administers and enforces the Motor Vehicle Dealers Act (MVDA) on behalf of the Ministry of Consumer Services
. OMVIC maintains a fair and informed vehicle sales marketplace by regulating dealers and salespersons, regularly inspecting Ontario's 8,000 dealerships and 24,000 salespeople, maintaining a complaint line for consumers and conducting investigations and prosecutions. OMVIC is also responsible for administering the Motor Vehicle Dealers Compensation Fund
on behalf of its
Board of Trustees
For More Information contact:
Manager of Communications, Media Relations and Education
Investigator – UMVPC