Beware of the following potential scam when buying from Car Dealerships
28 March 2013, 05:43 PM
#1
Scooby Newbie
Thread Starter
Join Date: Oct 2010
Location: South Wales
Posts: 11
Likes: 0
Received 0 Likes
on
0 Posts
Beware of the following potential scam when buying from Car Dealerships
Just thought you should all be aware of the following scam which has become more common recently when buying cars, and has been reported on several consumer programmes. I know this scam is still going on because it turns out I fell for it myself (despite being fairly well clued up on legal rights etc).
Fortunately I managed to cover myself well enough that, combined with knowledge of my basic legal rights, and threats to report the whole matter to the Police, that I should finally be getting a refund in the next week or so for the repair work that I had to after purchase do to make my car meet the description of 'Fit for Purpose' under the Sale of Goods Act.
The scam goes like this:
1) You see an advert for a car you like, and ring the dealer.
2) You make an appointment to view the car, the dealer says they work at Main Dealer X, and you agree to meet the dealer at the showroom.
4) You meet the dealer at the showroom, view the car and take it for a test drive. You then go in and sit at one of the salesmans desks to make the purchase.
5) You pay a deposit to the dealership and arrange when you are going to collect the car.
6) You return on another date to collect the car and pay the balance to the dealership. Again the dealer meets you at the showroom, you sit at the same desk, and you pay the balance to the car dealership.
7) You leave with the car.
HOWEVER - the 'dealer' was never actually a formal employee of the dealership, and you have essentially just conducted a 'private sale' inside the premises of the main dealer!
Typically as part of the scam they also offer a small extra discount for making payment by cash - or claim the credit card machine is broken so you can only pay by cash.
When a problem later occurs with the car the dealership denies all knowledge as they didnt sell the car to you - just accepted payment that they passed on to the 'dealer'. And because the dealer claims it was a private sale you have no comeback.
------------------
Checklist to avoid such scams:
1) Clearly ask during each and every communication with the 'dealer' who they work for, whether its a registered company, and what their VAT registration number is. Make sure you get the dealers address and phone number, rather than the showroom address.
2) If they claim to work at the dealership, get the dealership to give you their employee number, or confirm their employment status in writing.
3) Check whose name the original advert is in. Keep a copy for your records - preferably an electronic copy of the website page etc.
4) Get the dealer to write out a list of known faults, and make it clear to them that any fault that is not raised to your attention now could be grounds for a later complaint under Sale of Goods Act. Note that it doesnt matter whether the dealer is aware of faults or not for the purposes of Sale of Goods Act. Point out that if they can prove they did inform you in advance of known faults they are indemnifying themselves against future claims for those faults.
5) Pay a 200+ deposit by credit card if possible - to gain chapter 75 protection under the Consumer Credit Act.
6) Take photos of the 'dealer' at the dealership together with the car, and again sat at the sales desk. If possible also take photos of other staff in the dealership, including the manager. This will prove where the sale was conducted, and in what surroundings (e.g. him sat at a sales desk).
7) For the love of god DONT PAY BY CASH. Whatever payment method make sure its electronically recorded, and one that preferably has some sort of mechanism for making a claim afterwards.
8) If you notice any problems in the 1-2 weeks after purchase that would render the car UNFIT FOR PURPOSE under the sale of goods act then report them IMMEDIATELY and IN WRITING BY RECORDED DELIVERY to both the 'dealer' and the 'showroom'. Take photos of the faulty parts or items, and if possible get an independent inspection at another garage or the AA/RAC if its going to be very expensive to fix.
9) Legally you can choose to either reject the car and get all your money back if the car is unfit for purpose, or negotiate for repair work or costs to be refunded. These are all valid outcomes from a Sale of Goods Act claim.
10) Dont give up - they love piling obstacles in front of you or fob you off by telling you porkies about your legal rights.
11) A threat to make a Police Report for Fraud tends to work wonders in getting things sorted, as does the threat or reporting them to Trading Standards, and also to the Manufacturer's HQ - in order to let the manufacturer know the dodgy dealings going on at some of their dealerships.
------------------
If anyone wants to know which Subaru Main Dealer happenned to screw me over send me a PM - but I wont be giving out their name to anyone until after their refund has been received and is sat in my bank account!
Stay Safe!
LegacyBod
Fortunately I managed to cover myself well enough that, combined with knowledge of my basic legal rights, and threats to report the whole matter to the Police, that I should finally be getting a refund in the next week or so for the repair work that I had to after purchase do to make my car meet the description of 'Fit for Purpose' under the Sale of Goods Act.
The scam goes like this:
1) You see an advert for a car you like, and ring the dealer.
2) You make an appointment to view the car, the dealer says they work at Main Dealer X, and you agree to meet the dealer at the showroom.
4) You meet the dealer at the showroom, view the car and take it for a test drive. You then go in and sit at one of the salesmans desks to make the purchase.
5) You pay a deposit to the dealership and arrange when you are going to collect the car.
6) You return on another date to collect the car and pay the balance to the dealership. Again the dealer meets you at the showroom, you sit at the same desk, and you pay the balance to the car dealership.
7) You leave with the car.
HOWEVER - the 'dealer' was never actually a formal employee of the dealership, and you have essentially just conducted a 'private sale' inside the premises of the main dealer!
Typically as part of the scam they also offer a small extra discount for making payment by cash - or claim the credit card machine is broken so you can only pay by cash.
When a problem later occurs with the car the dealership denies all knowledge as they didnt sell the car to you - just accepted payment that they passed on to the 'dealer'. And because the dealer claims it was a private sale you have no comeback.
------------------
Checklist to avoid such scams:
1) Clearly ask during each and every communication with the 'dealer' who they work for, whether its a registered company, and what their VAT registration number is. Make sure you get the dealers address and phone number, rather than the showroom address.
2) If they claim to work at the dealership, get the dealership to give you their employee number, or confirm their employment status in writing.
3) Check whose name the original advert is in. Keep a copy for your records - preferably an electronic copy of the website page etc.
4) Get the dealer to write out a list of known faults, and make it clear to them that any fault that is not raised to your attention now could be grounds for a later complaint under Sale of Goods Act. Note that it doesnt matter whether the dealer is aware of faults or not for the purposes of Sale of Goods Act. Point out that if they can prove they did inform you in advance of known faults they are indemnifying themselves against future claims for those faults.
5) Pay a 200+ deposit by credit card if possible - to gain chapter 75 protection under the Consumer Credit Act.
6) Take photos of the 'dealer' at the dealership together with the car, and again sat at the sales desk. If possible also take photos of other staff in the dealership, including the manager. This will prove where the sale was conducted, and in what surroundings (e.g. him sat at a sales desk).
7) For the love of god DONT PAY BY CASH. Whatever payment method make sure its electronically recorded, and one that preferably has some sort of mechanism for making a claim afterwards.
8) If you notice any problems in the 1-2 weeks after purchase that would render the car UNFIT FOR PURPOSE under the sale of goods act then report them IMMEDIATELY and IN WRITING BY RECORDED DELIVERY to both the 'dealer' and the 'showroom'. Take photos of the faulty parts or items, and if possible get an independent inspection at another garage or the AA/RAC if its going to be very expensive to fix.
9) Legally you can choose to either reject the car and get all your money back if the car is unfit for purpose, or negotiate for repair work or costs to be refunded. These are all valid outcomes from a Sale of Goods Act claim.
10) Dont give up - they love piling obstacles in front of you or fob you off by telling you porkies about your legal rights.
11) A threat to make a Police Report for Fraud tends to work wonders in getting things sorted, as does the threat or reporting them to Trading Standards, and also to the Manufacturer's HQ - in order to let the manufacturer know the dodgy dealings going on at some of their dealerships.
------------------
If anyone wants to know which Subaru Main Dealer happenned to screw me over send me a PM - but I wont be giving out their name to anyone until after their refund has been received and is sat in my bank account!
Stay Safe!
LegacyBod
28 March 2013, 09:41 PM
#4
Scooby Regular
What am I missing here? You met them twice and took you through an entire sale in someone elses showroom. They somehow obtained the keys with which you drove the car and the dealership never realised?
On top of this I dont really see what it has to do with SOGA? I would have thought that fraud and theft would be more applicable.
On top of this I dont really see what it has to do with SOGA? I would have thought that fraud and theft would be more applicable.
Trending Topics
29 March 2013, 12:00 AM
#8
Scooby Newbie
Thread Starter
Join Date: Oct 2010
Location: South Wales
Posts: 11
Likes: 0
Received 0 Likes
on
0 Posts
OK, I'll take the bait 
Well, as I only have:
1) the original autotrader advert giving the 'dealers' contact details;
2) invoices for all payments (in the name of the Subaru dealership - and NOT the 'dealer'), backed up by credit card records and bank statements;
3) independent eye witnesses who drove me to the dealership to pickup the car (thus also meeting the 'dealer' in person inside the dealership);
4) correspondence from the dealership denying they sold the car (even though the sale happened on their premises and they took full payment);
5) Records of every phone call to the 'dealer' and dealership;
6) Recorded delivery slips for the letters of complaint sent to the dealership.
then no, I have absolutely no evidence.............
Obviously I wont be publishing all the personal information on here - but all I am trying to do is to raise awareness of a possible scam that has been reported by various consumer groups over the last few months with increasing regularity. Your choice if you choose to ignore it!
Its essentially the inverse of the well known 'private sale' scam (only in this case the independent seller poses as staff inside a showroom to conduct a sale, giving the false impression the customer is buying from the dealership, when in fact its a 'private sale').
This is only possible because you dont get to see the motor trader section of the V5 document (because the previous owner sends it direct to DVLA), which would tell you who actually is the current owner of the car you are buying!
Also see OFT Advice to Traders (which is VERY clear): http://www.oft.gov.uk/shared_oft/rep...08/oft1241.pdf
And Legal precedence for SOGA: http://www.honestjohn.co.uk/faq/consumer-rights/
Other useful background info: http://www.mylawyer.co.uk/buying-a-u...-A76053D34188/
So by all means take the **** - but as long as those people on here who are about to buy a car take the time to ask a few extra important questions of the seller before they hand over any cash then I will consider this a job well done
Well, as I only have:
1) the original autotrader advert giving the 'dealers' contact details;
2) invoices for all payments (in the name of the Subaru dealership - and NOT the 'dealer'), backed up by credit card records and bank statements;
3) independent eye witnesses who drove me to the dealership to pickup the car (thus also meeting the 'dealer' in person inside the dealership);
4) correspondence from the dealership denying they sold the car (even though the sale happened on their premises and they took full payment);
5) Records of every phone call to the 'dealer' and dealership;
6) Recorded delivery slips for the letters of complaint sent to the dealership.
then no, I have absolutely no evidence.............
Obviously I wont be publishing all the personal information on here - but all I am trying to do is to raise awareness of a possible scam that has been reported by various consumer groups over the last few months with increasing regularity. Your choice if you choose to ignore it!
Its essentially the inverse of the well known 'private sale' scam (only in this case the independent seller poses as staff inside a showroom to conduct a sale, giving the false impression the customer is buying from the dealership, when in fact its a 'private sale').
This is only possible because you dont get to see the motor trader section of the V5 document (because the previous owner sends it direct to DVLA), which would tell you who actually is the current owner of the car you are buying!
Also see OFT Advice to Traders (which is VERY clear): http://www.oft.gov.uk/shared_oft/rep...08/oft1241.pdf
And Legal precedence for SOGA: http://www.honestjohn.co.uk/faq/consumer-rights/
Other useful background info: http://www.mylawyer.co.uk/buying-a-u...-A76053D34188/
So by all means take the **** - but as long as those people on here who are about to buy a car take the time to ask a few extra important questions of the seller before they hand over any cash then I will consider this a job well done
Last edited by LegacyBod; 29 March 2013 at 02:03 AM. Reason: Because I cant [s]smell[/s] spell
29 March 2013, 11:13 AM
#9
If someone is buying and selling cars for profit...they ARE a dealer. Even if they do it on a personal basis its still a form of income...and a form of income is a job, therefore a trade (albeit self employed).
I'm sure the inland revenue would like to hear from the so called "private seller" as much as the ripped-off customers.
Anyhoo, if he is seen as trading, then he HAS to comply with the laws and rules with reagrds to selling goods fit for purpose etc.
I'm sure the inland revenue would like to hear from the so called "private seller" as much as the ripped-off customers.
Anyhoo, if he is seen as trading, then he HAS to comply with the laws and rules with reagrds to selling goods fit for purpose etc.
Last edited by ALi-B; 29 March 2013 at 11:19 AM.
29 March 2013, 11:39 AM
#12
Scooby Newbie
Thread Starter
Join Date: Oct 2010
Location: South Wales
Posts: 11
Likes: 0
Received 0 Likes
on
0 Posts
Will post up more detail when I have received the refund later next week - let just say that based on comments to date the 'dealer' appears to have a close working relationship with the showroom, even though he isn't employed by them.
Last edited by LegacyBod; 29 March 2013 at 11:40 AM.
29 March 2013, 12:27 PM
#15
Scooby Regular
iTrader: (61)
Join Date: Aug 2005
Location: N.I
Posts: 3,444
Likes: 0
Received 0 Likes
on
0 Posts
If it was sold on the dealers premises and they took payment it is without a doubt the dealers responsibility. There is no way around it and there is no way out.
Thread
Thread Starter
Forum
Replies
Last Post