Cheap cars

Cheap cars on Facebook: scams lead to new warnings

Experts have issued new warnings about used car scams on Facebook and other social media channels as the latest figures show a sharp increase in the number of consumers caught by fake ads in the market –

placed by people with false identities – for vehicles that do not exist.

The coronavirus crisis has pushed up used car prices as commuters try to avoid public transport. However, this has led to an increase in fake used car ads on social media such as Facebook Marketplace.

The figures provided by the Australian Competition and Consumer Commission (ACCC) show that used car scams were the second biggest form of fraud this year – after bogus pet ads and in front of dubious phone and computer sellers.

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“Losses from online shopping scams have increased by 42% this year,” said ACCC, whose Scamwatch division has received more than 12,000 online shopping fraud reports and about $ 7 million in losses reported so far in 2020.

In particular, losses on classified websites, such as Facebook Marketplace and Gumtree, have increased 60% this year, to $ 4.5 million, the ACCC said.

Among these scams, used car fraud accounted for $ 808,500 in losses – that’s the total amount of money people said they paid someone for a car that didn’t exist.

Motorists looking to get a good deal on used cars are particularly vulnerable as “more people have shopped online this year due to COVID-19 restrictions,” said ACCC vice president , Delia Rickard, in a press release.



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“Beware of popular products that are priced much lower than (others)” and “ask for payment by direct bank transfer” without first inspecting the car.

“Take the time to think about who you are dealing with and don’t be fooled by special offers,” Ms. Rickard said.

The Australian Automotive Dealers Association (AADA) says that while online deals may seem appealing, buyers have no recourse if the ad is bogus or the car doesn’t exist.

“Although consumers will see well-priced cars listed by private sellers on social media, they should be aware that there are risks involved in buying from an authorized dealer,” said James Voortman, CEO of AADA, which represents 3,000 dealers nationwide. .

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“Buying from a car dealership gives consumers legal warranties and cooling off periods, as required by state law. You can also have peace of mind because used vehicles purchased from a dealership have a clear title warranty, which is a written notice guaranteeing that the consumer has not purchased a stolen car or that it does not. there is no money on it.

Mr Voortman added “You just don’t have these protections when you buy privately on social media.”

“Dealers not only have a legal obligation (under various state laws), but must also comply with the makes of cars to which they are franchised,” Mr. Voortman said.

“You can be sure that they will subject all used vehicles to thorough inspections to determine the suitability of that vehicle for sale. Unsuitable vehicles are usually sold wholesale or auctioned off.

Joshua Dowling

Joshua Dowling has been an automotive journalist for over 20 years, spending most of his time working for The Sydney Morning Herald (as Automotive Editor and an early member of the Drive team) and News Corp Australia . He joined CarAdvice / Drive at the end of 2018 and was a World Car of the Year judge for 10 years.

Learn more about Joshua Dowling


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