Used car and caravan sales scams on the rise

Fake 'for sale' vehicle ads continue to be an issue, with the Australian Competition and Consumer Commission (ACCC) warning that scammers are now resorting to impersonating defence personnel as the used car and caravan market hits record highs due to high demand and low supply.

According to the ACCC, Australians have already lost over $288,000 to vehicle sales scams in the first quarter of this year – more than all losses reported to Scamwatch in 2019.

“As second-hand car sales increased during the pandemic, unfortunately so did vehicle scams,” said ACCC deputy chair, Delia Rickard.

“If current trends continue, Australians could lose much more to vehicle scams this year than the $1 million lost in 2020.

“We want to raise awareness of these scams to reduce the number of people who may be vulnerable to them.”

Typically, vehicle scams involve scammers posting fake online listings offering high-demand vehicles for sale at prices well below market value to lure potential buyers looking for a used vehicle. Scammers seek payment to secure the car or caravan for the buyer but never deliver the vehicle.

The ACCC says a new scamming technique involves scammers pretending to be defence personnel. In fact, in 97 per cent of reports received this year, the scammer claimed to be in the military (navy, army or air force) or to work for the Department of Defence, and said they wanted to sell their vehicle before deployment.

This approach seeks to create a sense of urgency with buyers and explain the unusually low listing price and why buyers cannot inspect the vehicle prior to payment.

Indications of a scam could include an email address that does not bear the legitimate defence email format of @defence.gov.au.

Some examples of the fake Department of Defence emails that have been used in recent vehicle scams include @airforce-raaf.org, @royal-australian-defence-gov.com and defence@royal-australian-air-force-gov-au.com.

However, even the correct email format does not guarantee the fake ad isn’t a scam because scammers are able to ‘spoof’ email addresses.

Scamwatch received 346 reports of vehicle scams to March 31, with $288,459 in losses reported during this period.

“A price that is too good to be true should be a warning sign for potential buyers,” said Rickard.

“If a classified ad offers a vehicle at a very low price, the ad might not be legitimate.”

Vehicle scammers often seek payment via a third party, with a large number of reports to Scamwatch mentioning the use of escrow agents, a third party that holds money from the buyer until goods are received and then releases the funds to the seller.

Other commonly requested payment methods include eBay, direct bank transfer or international money transfers such as Western Union.

“If the seller claims to be unavailable and insists on payment before meeting the buyer or allowing them to pick up their new car, this should raise suspicions,” continued Rickard.

“It is relatively common for scammers to claim that they are travelling or moving away to avoid meeting buyers before payment.

“Always try to inspect the vehicle before purchase and avoid unusual payment methods. If you have any doubts, do not go ahead with the deal.

“We encourage consumers to trust their instincts. If something seems too good to be true, it probably is.”

In addition to losing money to vehicle scams, around 20 per cent of consumers who reported vehicle scams have lost personal information after providing their address, phone number and copies of their driver’s licence to the scammer.

To protect your identity, the ACCC says you should never provide your personal details to someone you have only met online.

If you have been the victim of a scam, contact your bank as soon as possible and the platform on which you were scammed to inform them of the circumstances.

You can report a scam at the ACCC’s Scamwatch website and any online loss to the Australian Cyber Security Centre’s ReportCyber website, which ‘triages’ reports and allocates them to the relevant law enforcement authorities for further action.

Used car buyers can also check whether their potential purchase is an actual vehicle, under finance or stolen via the federal government’s Personal Properties Securities Register (PPSR) or its equivalent in each state.

Unlike some online sales platforms, the carsales network has robust processes in place to detect scammers. It also offers peace-of-mind products including FACTS+ and RedBook Inspect pre-purchase vehicle inspections so consumers can buy with greater confidence.

Read caravancampingsales’ tips to help protect yourself online.

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