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USED-car scams represent the second-highest number of fraud cases in Australia – valued at more than $808,000 – and the nation’s consumer watchdog says COVID-19 has a lot to do with the practice magnifying.

The Australian Competition and Consumer Commission (ACCC) said that 568 people have this year reported car fraud in which the car they bought had not existed. The value of these cases is $808,571, according to the ACCC.

The Australian Automotive Dealers Association (AADA) urged people looking for a used car to first consider a licensed dealer.

AADA CEO James Voortman said: “There are significant protections for consumers who choose to buy a used car from licensed car dealers, including state government statutory warranties, cooling-off periods and a clear title guarantee.”

The ACCC said that losses to online shopping scams had increased 42 per cent this year.

Its Scamwatch section has received more than 12,000 reports of online shopping scams so far this year, with almost $7 million in reported losses over a whole raft of goods.

ACCC deputy chair Delia Rickard said in a statement: “More people have been shopping online this year due to COVID-19 restrictions and scammers are now targeting people doing their Christmas shopping, including in the Black Friday and Cyber Monday sales.”

The ACCC said: “Scammers create fake websites that look like genuine online stores, offering products at very low prices and victims will either receive a fake item or nothing at all.”

“They also post fake ads on classified websites, often claiming they are travelling and someone else will deliver the goods, but the item never arrives and the victim can no longer contact the seller.”

Mr Voortman said: “New car dealers differ from private sellers in that they have a strong interest in generating repeat business.”

“They also have a strong imperative to maintain their reputation for their customers and their franchisors.”

James Voortman

Mr Voortman said dealers make use of their expert technicians and state-of-the-art equipment to make sure any vehicle being sold is in excellent running condition and fit for purpose to ensure consumers have a reliable and safe purchase.

He said the scam practices relating to car sales covered a broad range of outlets.

“Consumers should be wary across various platforms, including classified websites, social media channels and even more traditional platforms such as magazines,” he said.

“Scammers are often very convincing, but consumers may be able to pick a scam by exercising common sense and looking out for obvious signs.

“Is the price too good to be true? Is the seller rushing the sale and insisting on payment before the car has been seen?”

Mr Voortman said buyers can minimise their potential to be scammed by conducting appropriate due diligence.

“The best way to do that is to avoid buying the car (from a private seller) sight unseen,” he said.

“Conduct a test drive and have a mechanic inspect the car prior to exchanging any money.”

Ms Rickard said: “Watch out for popular products being sold at prices much lower than on other websites and sellers requesting payment through direct bank transfer or cryptocurrency.”

“Take the time to consider who you are dealing with and don’t be pressured by special offers.”

The product with the most reported scams this year to date is pets, particularly puppies.

The Top Five:

  1. Pets – 2111 cases with losses valued at $2.05 million
  2. Used cars – 568 cases and a loss of $808,571
  3. Games and Xboxes – 182 cases with losses of $381,110
  4. Phones – 428 cases with losses of $258,199
  5. Computers and drones – 356 cases with losses of $205,496.

Other product lines in the top 10 are shoes, clothing, toys, handbags and barbecues.

By Neil Dowling

AdTorque Edge