When shopping for cars, consumers typically fill out a credit application at the dealership. The dealership may then submit the application to multiple banks and finance companies. This is known as "shotgunning". When a prospective creditor pulls your credit report,...
Month: March 2015
The Yo-Yo Scam: The Car Dealer Takes Back the Car
In the typical Yo-Yo Scam, a car dealership tells the consumer that she is "all set" and that her credit application has been approved. She drives home in her new (or pre-owned) car and shows it off her to her friends, family, and co-workers. About a week later, the...
Are Certified Pre-Owned Cars Worth the Extra Money?
Are Certified Pre-Owned ("CPO") cars worth the extra money? A recent article by Tribune Newspapers discusses the increased cost of CPO vehicles, which consumers bought at record levels in 2014. Certified pre-owned cars are supposedly subjected to an extensive...
Do You Really Need a New Car?
A recent Consumer Reports article asks the question that every new car buyer should ask before going to the car dealership: Do You Really Need a New Car?: New-car envy. It can creep up anytime. It may snag you at a stoplight when a muscle car or luxury sedan sidles...
Games Dealers Play: Powerbooking
Powerbooking is one of the most common types of credit application fraud that car dealers commit. A car dealership powerbooks when it tells a bank or finance company that a car or truck is loaded even though it does not have many of the options that are described. For...
When Car Dealers Commit Forgery
Do car dealer employees commit forgery? "It is like smoking a cigarette," said one employee of a major Connecticut car dealership. This individual, a salesman who was upset with his employer, had agreed to talk with me about dealership practices. He confirmed what we...
If Buying a Used Car, Don’t Skimp on the Inspection
The most important thing that a consumer should do before buying a used car is have an independent mechanic inspect the car or truck. A qualified inspector can help car buyers avoid vehicles with serious defects or other problems. Additionally, any minor problems...
Games Dealers Play: Trade-In Games
The advertisements seem too good to be true: the car dealership will give you $3,500 for your trade-in, regardless of condition. Many consumers who have trade-ins with serious problems find these offers impossible to resist. But, be careful, because these...
Odometer “rollbacks” are often part of a bigger picture
The types of fraud that an auto dealership could commit are limited only by the fraudster's imagination. Many times, a multifaceted approach is used that incorporates a variety of methods. Odometer rollbacks are a common fraud in the used car market. Manipulating the...
Are you just unlucky with your car, or were you tricked?
When you buy a car, you know that it’s going to break down at some point. It’s going to need repairs. All vehicles do. This is just a given, and many people specifically budget for these future needs. However, you also expect it to last for a certain amount of time...
Vehicle history checks should consider recent flooding
Connecticut and states across the entire U.S. were negatively impacted by the recent massive storms and tornados. Damaged property was a major problem and a significant portion of that was inflicted on vehicles because of widespread flooding. Water damage can severely...
What to do if you’re a victim of auto dealer fraud
Purchasing a car is a major deal for most Connecticut residents. Cars cost thousands of dollars and it can be nerve wracking to go to a dealership, pick out a car, negotiate a price, and obtain financing. Car dealerships are full of notoriously shady characters and a...
Can a dealership just paint over major rust damage?
Winter weather, road salt and age can all contribute to the amount of rust that develops on a vehicle. Rust is unattractive, but it is far from just a cosmetic issue. Substantial amounts of rust on a vehicle can impact its structural integrity in the event of a crash....
What’s a straw purchase dealer scam?
Imagine this: You go to a dealership to buy a vehicle. You find one you like that is around $2,000 above your limit. You can’t finance it, so you decide that you should walk away and wait to get something else. Then, the dealer stops you. What if someone they know...
Auto dealer fraudster sentenced to prison for 60 months
Used car dealers and salesman are some of the most hated individuals in the U.S. This is mostly due to a pervasive idea that they are fraudsters, and this is why every state has laws against auto dealer fraud. Though, what some may not realize is that federal law also...
Avoiding online car buying scams
Readers of our blog are no stranger to car buying scams. Indeed, many of our blogs are devoted to auto dealer fraud, like last week’s blog. In that blog post, we described how some online “internet prices” were actually after an undisclosed down payment. And, after...
Be careful when shopping for a car online
When a Connecticut resident needs a new car chances are they will search the internet first before heading into the dealership. This can be a good way of checking prices, models, features, etc., but a recent article in PC Magazine highlights the deceptive nature of...
Don’t get burned by these three common types of auto fraud
Studies show that around 1 in 10 property/casualty insurance claims are fraudulent. In fact, insurance fraud is close behind tax evasion amongst some of the most pervasive white-collar crimes. This means that the likelihood of experiencing the outcome of such fraud is...