New car scam: don't 'buy' a rented car

Scammers rent car, then 'sell' it repeatedly.

Warnings have been raised about a new scam targeting those looking to buy a new car.

When I first heard about this, I thought it seemed so simple that it must have been perpetrated many times over the years. But no, the folks at HPI, which provides vehicle history checks on second hand motors, assure me that it has only recently hit its radar.

How the scam works

This is how it works. Car buyers looking for something a couple of years old search through the usual sources – online, local newspapers. And they find something that looks a good couple of thousand pounds cheaper than it should be, compared to vehicles of similar make, age and condition.

There can be all sorts of legitimate reasons why someone wants to sell a car at a bargain price such as domestic circumstances, work requirements and plans to emigrate, although these can usually be boiled down to simply needing money quickly.

The buyer contacts the seller, who agrees on the price. They may send photos to show the car is in good condition. These emails will also emphasise what a great price is on offer by including similar cars from legitimate sellers who all want much more.

Buyers are put at ease. The seller even offers to bring the buyer to their own home, so that they can inspect the car.

Once they have seen the car, the seller then asks the buyer for £1,000 as a “good faith” deposit to ensure no one else buys it. Then the buyer goes away to arrange finance for the rest of the purchase.

The whole thing is a fraud. The buyer never sees the car or the £1,000 (generally in cash) again. 

The scamsters rent a car of the same age and make as the one they advertise from a legitimate hire company for a day. Some will pay in cash, but most rental firms demand credit cards so a freshly stolen one is always useful. The car rental firm is, needless to say, completely unaware of how their motor will be used, although it will suffer as well once the credit card theft is discovered.

The fraudsters hope to collect as many 'deposits' as they can before they return the car the next day. In some cases, they can pull off this trick six or seven times before the car goes back to the rental firm, whose main concern is the safe return of their vehicle. They probably won't notice or care that it has only been driven just a few miles.

But what about visiting the purported seller's home? This serves two purposes. The first is the reassurance of supposedly knowing where the car comes from. It's often a nice home in a good area, although to work the scam, the victim sees the car on the road outside (rather than on a drive) and never gets invited into the property. This is because the home does not belong to the fraudsters, although it may be rented for a week or two by an untraceable associate, who dresses it up like a family home (kids' balls, bikes and scooters by the doorway, for instance).

And the second is that the method of inviting victims to their property instead of taking the car to the potential buyer gives time to recycle the scam several times in a day.

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How can you protect yourself?

Firstly, be very suspicious of any offer that is substantially below the market. Secondly, always ask for paperwork such as the logbook, the certificate of insurance and, if the car is past its first flush of youth, the MoT certificate. Fraudulent sellers won't be able to produce these unless they are skilled at forgery as well – unlikely as the whole thing revolves around speed and they will only know the registration of the car that morning.

Finally, verify the ownership with a firm like HPI Check before parting with a penny piece of cash. 

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More on scams:

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