The Australian Competition and Consumer Commission (ACCC) reported this week that more than $288,000 has been ripped off Australians through vehicle scams in the first quarter of this year alone.
The quarterly loss is bigger than all losses reported to ACCC’s Scamwatch in 2019.
Scamwatch received 346 reports of vehicle scams between January 1 and March 31, with $288,459 in losses reported during this period.
This compares to more than 1000 reports and more than $1 million lost in 2020, and 330 reports and about $245,000 losses in 2019.
The ACCC said that scammers have begun impersonating defence personnel “to con their victims”.
“In a vehicle scam, scammers post fake online listings offering to sell in-demand cars at well below market value to lure potential buyers looking for a second-hand vehicle,” the ACCC statement said.
“Scammers seek payment to secure the car for the buyer but never deliver the vehicle.
“Vehicle scams are commonly hosted on sites such as Facebook Marketplace, Autotrader, Carsales, CarsGuide and Gumtree,” the ACCC said.
ACCC deputy chair Delia Rickard said the rise in second-hand car sales during the pandemic was tied to the rise in the number of scams.
“If current trends continue, Australians could lose much more to vehicle scams this year than the $1 million lost in 2020,” she said.
“We want to raise awareness of these scams to reduce the number of people who may be vulnerable to them.”
Ms Rickard said the latest technique reported to Scamwatch is scammers pretending to be defence personnel.
“In 97 per cent of reports received this year, the scammer claimed to be in the military (navy, army and air force), or to work for the Department of Defence, and said they wanted to sell their vehicle before deployment,” she said.
“This sought to create a sense of urgency with buyers and explained the unusually low listing price of the vehicles and why buyers could not inspect them prior to payment.”
The ACCC said that people scammed were mainly aged 18-24. They have lost the most money to vehicle scams in 2021 so far, $79,210 or 27 per cent of total losses.
People aged under 35 accounted for 35 per cent of the total losses reported to vehicle scams so far in 2021. People aged 65 years and over reported lower losses than all other age groups.
New South Wales has the highest number of reports (114) and losses ($97,297) to vehicle scams, while the Northern Territory and Tasmania have not reported any losses this year to date.
Some examples of the fake Department of Defence emails that have been used in recent vehicle scams include: @airforce-raaf.org; @royal-australian-defence-gov.com; and email@example.com
The ACCC said that email addresses that do not bear the legitimate defence email format of @defence.gov.au may be an indication of a scam.
But it said that even the correct email format does not guarantee the car ad is not a scam, as scammers are able to spoof email addresses.
“It is best to look for all warning signs to avoid being scammed,” it said.
“A price that is too good to be true should be a warning sign for potential buyers. If a classified ad offers a vehicle at a very low price, the ad might not be legitimate.
“For example, one Scamwatch report noted a listing that advertised a car for nearly $10,000 below its market value to entice buyers looking for a bargain.”
The ACCC said that vehicle scammers often sought payment via a third party website.
“A large number of reports to Scamwatch mentioned the use of escrow agents, a third party who is supposed to ‘hold’ the money from the buyer until goods are received, before releasing the funds to the seller,” the commission said.
Other commonly requested payment methods include eBay, direct bank transfer or international money transfers.
“If the seller claims to be unavailable and insists on payment before meeting the buyer or allowing them to pick up their new car, this should raise suspicions,” Ms Rickard said.
“It is relatively common for scammers to claim that they are travelling or moving away to avoid meeting buyers before payment.
“Always try to inspect the vehicle before purchase and avoid unusual payment methods. If you have any doubts, do not go ahead with the deal.”
Ms Rickard said that in addition to losing money to vehicle scams, about 20 per cent of consumers who reported vehicle scams have lost personal information through providing their address, phone number and copies of their driver’s license to the scammer.
“To protect your identity, never provide your personal details to someone you have only met online,” Ms Rickard said.
“Fortunately more than 80 per cent of people who reported vehicle scams managed to avoid losing money by identifying the scam early.
“We encourage consumers to trust their instincts. If something seems too good to be true, it probably is, Ms Rickard said.”
Autotrader Group said in a statement to GoAutoNews Premium: “The safety and security of our community across our platforms – Autotrader, Gumtree Cars and CarsGuide – is a top priority. We take any form of online scam seriously.
“To ensure our users have a safe and successful experience, we implement a number of safeguards.
“This includes a ‘Buy & Sell Safely’ guide that is permanently linked to any vehicle listing page on CarsGuide & Autotrader; help and security pages across CarsGuide, Autotrader and Gumtree with advice on how to remain vigilant when using an online marketplace; and a ‘Report Ad’ function on every listing which allows users to report any ad that seems suspicious.
The statement said that Gumtree remains Australia’s favourite local marketplace with a 99 per cent safe trading success rate on that platform.
“As with any online marketplace, we rely on our user’s feedback to keep the platforms safe and we strongly encourage our engaged communities to report any concerning listings believed to be unlawful in any way.
“Awareness is a critical step in identifying scammers online and that’s why we’re pleased to support the ACCC in their efforts to raise awareness and provide information to support Australians looking to buy or sell a second hand vehicle online.”
The ACCC said that victims of a scam should contact their bank as soon as possible and contact the platform on which they were scammed to inform them of the circumstances.
More information on scams is available on the Scamwatch website, www.scamwatch.gov.au including how to make a report and where to get help.
By Neil Dowling