Selling Your Car? Beware of These Scams

There are few things worse than being cheated out of your hard-earned money. Sadly, there are people in the world who make it their mission in life to cheat us, lie to us, and steal from us, making these fears a reality. These tricksters make use of a variety of notorious mediums, such as scams for selling cars, life insurance, money transfer schemes, lottery payouts, emotional manipulation, and credit card fraud.

Nowadays, as almost everything moves online, we can't even rely on our intuition to help us spot these fraudsters. Instead, we are bombarded with phony spam emails promising us the world and feeding on our desperation and fears. Unfortunately, while some of these scammers are foolish and uneducated, all too easily giving themselves away, others are cunning and smart, oiling their way into our good graces and wallets. Luckily, we live in the age of information, and all the tools for dealing with these snake oil salesmen is at our fingertips. You simply have to know where to look.

While the most common scammers try to sell us fake goods, there is a select sub-species that use the reverse tactic. There are loads of online used-car buying scams, taking advantage of people at their most vulnerable. Generally, it is safest to buy through dealers, though not all have your best interests at heart. People who sell their cars privately are usually those that need money the most, making them even more susceptible to online car buying scams.

Scammers operate by contacting the seller telephonically or via email, expressing an interest in buying the vehicle as soon as possible. Often, they will offer alternative forms of payment that are harder to authenticate, such as PayPal. The transaction is always faked, however, with the trickster sending a phony email notifying you that the money has been deposited. They then request that you ship them the car, and once it is out of your sight, it is almost impossible to track it down when you realize you've been duped.

Con artists are always coming up with new ways to scam unsuspecting individuals. To date, there are a number of different internet car sales scams you might fall victim to, so it is more important than ever that you know what to be on the lookout for. Here are some of the most common dangers to be aware of:

• Sight-unseen buyers - Nobody should ever purchase a vehicle without seeing it, so if a buyer seems willing to do so, the alarm bells should be ringing (read more about buying cars sight unseen here). You can be certain that the check is going to bounce the moment you try to cash it, and if you've already begun the shipping process, it may be too late to do anything about it.
• Bogus checks or money orders - Following on from the point above, scammers never actually pay for the car you are selling in car sales scams. Just because you have the check in hand, that does not mean you have the money.
• Overpayment - Another clear warning sign is an overeager buyer. If the person you are interacting with seems happy to pay more than your asking price to expedite the transaction, you should be very wary.
• Payment plans - Even if a buyer is legitimate, you should never consider a payment plan. The risk that the new owner of the car will simply stop paying is very real.
• Escrow services - Any offer to pay using a third-party service is suspicious, as only a select few are actually reliable and it is all-too-easy to fake when running a used car-buying scam.
• Identity theft - It is not uncommon for a con artist to promise a payment in order to gain access to your personal information, such as bank account information, your social security number, or your credit card info.

In the event that you encounter any of these warning signs, there are steps you can take to avoid or minimize risk.

• Know where the money is - The best way to finalize a sale is with the cash in hand. But, if you are willing to accept a money transfer or check, always ensure the money has cleared and is in your account before you hand over the keys.
• Don't start shipping without finalizing the sale - This follows on from the above. The car should never be out of your sight until you have the money in your account.
• Only use reputable escrow services - Be sure the third-party platform you are using has a good reputation, such as PayPal.
• Know who you're dealing with - It is important to know as much as possible about a potential buyer. This means confirming their phone numbers and asking to see legal identification such as a driver's license and/or proof of address.
• Keep documentation - Following on from the above, you should keep careful notes of every step in the sales process. If something does go wrong, you can then give a detailed account to the authorities.
• Trust your instincts - If, at any point in the interaction, you get the feeling that something is off, rather just cut ties and move on. There will be other buyers, so there is no risk to feel pressured into doing something that makes you uncomfortable.

Internet car-selling scams are crimes, just like any other fraudulent activity. As such, there are certain actions you can take if you suspect you are being targeted, or if you have already suffered from internet used car-selling scams. In the USA, you should always report any potential scam to your local government at the state consumer protection office as well as the Federal Trade Commission. If you have already lost money or your vehicle, it is also a matter for the police so they should be informed, too.

More broadly, you can also report potential scammers to the US Federal Government. However, due to the large number of reports they receive, you will likely not receive any follow-up communication, so ensure that your report is detailed. Even if you do not receive feedback, do not feel discouraged. Your information could help others avoid the same troubles you have been through.