The Financial Conduct Authority (FCA) recently issued a warning to the public about an expected rise in scam activity following the disruption and concerns caused by the coronavirus pandemic. It’s a time when many families and businesses are worrying about job and income security – which unfortunately makes for an ideal time for fraudsters to strike.
These uncertain economic times increase the potential for motorists to fall foul of fraudulent car dealers, or simply dealers whose businesses have become financially unstable. To help protect yourself – and your money – here are a few red flags to watch out for.
The basics of fraudulent car dealers
Due to COVID-19 and its financial pressure, there have been a number of businesses that have collapsed. This pandemic has shown us that no business is immune to financial strain. Right now, there is a higher risk of car dealerships going out of business once deposits have been paid.
Unfortunately, when you’re looking to purchase a vehicle during this time, you will be susceptible to some fraudulent dealers who are just looking to take your cash and run with it. It is up to you to ensure that you are working with reputable, trustworthy and financially stable dealers.
Red flags to look out for:
• It sounds too good to be true. If you are considering a bargain deal – even in this unprecedented time – consider if it’s too good to be true. Whether it’s a car with only 15,000 miles on the clock or a new vehicle priced at half its value, you should always err on the side of caution.
• It sounds complicated. Scammers will often confuse their victims with industry jargon to sway them into agreeing to a price and a vehicle. If your car dealer doesn’t take the time to talk through agreements and acronyms, it’s time to find a different dealer.
• Used car dealers masquerading as a private seller. Some used car dealers pretend to be private sellers to avoid regulations. If you’re going to buy a used vehicle, do plenty of due diligence on the dealer’s business status and business address. Where possible, buy a nearly-new vehicle so that if there are any warranty issues with the vehicle, you’ll be able to resolve them quickly.
• Little to no online presence. Can’t find the dealership online? No website or reviews for the dealer? Credible sellers want to promote their good work through a website and social media channels. If the seller has no reputation, you have no idea what they are like to do business with.
• If in doubt, report. Think that you’re onto a fraudulent car dealer? Motorists should report any scam to Action Fraud for further investigation. Doing so could help other people like you from being conned out of their hard-earned money.
How My Car Credit can help
At My Car Credit, not only do we work with motorists to find the right car financing plan for their needs and budget, but we have additional checks to ensure that our clients are protected.
• Our agents call every customer for security and identification purposes.
• We have enhanced due diligence checks to establish affordability.
• We have enhanced vulnerability checks.
• We check the suitability of every dealer on behalf of our customer.
• During the COVID-19 situation, we have changed our payout process to protect customers. We now do not release funds to the dealer until the customer confirms they have taken delivery of the vehicle.
At My Car Credit, we help you through every step of our safe and hassle-free car finance process. For an instant quote, and to see what car finance plan you can be eligible for, please use our simple car finance calculator. Contact us today on 01246 458 810 or emails us at email@example.com to get started!
Require more help?
Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!