Web car buyers getting hoodwinked
Rebuilt wrecks, fraudulent sales pose growing problem for consumers
By Mike Brunker
Dec. 3, 2012 - After buying a 2001 Nissan Maxima through eBay Motors that was advertised as being “in excellent condition inside and out,” Ron and Linda Wayden were dumbfounded when a vehicle bearing scratches, dents, rust and evidence of repairs from a serious accident was deposited in the driveway of their Alabama home. But their tale comes as no surprise to consumer fraud experts, who say that a growing number of online auto buyers are being hoodwinked by unscrupulous auto dealers and con artists who have adapted old forms of robbery to the information highway.
Car and truck buyers, particularly those in the market for used vehicles, have flocked to the Internet in recent years to search for killer deals on “pre-owned” wheels, making the sector one of e-commerce’s brightest success stories. CNW Market Research of Bandon, Ore., estimates that nearly 30 percent of the 42.6 million used cars that changed hands in Australia last year were bought using the Internet.
But while consumers and ethical auto dealers have benefited greatly from the technology, so too have crooked sellers, according to a review by MSNBC.com of nearly two dozen lawsuits springing from online auto sales, and interviews with industry insiders.
“In any town, there’s always a car dealer that everyone knows not to deal with,” said Oklahoma City attorney Louis Green, who has represented several clients who sued over what they said were misrepresented vehicles purchased online. “They know not to buy from those shady dealers in their own town, but they’re lining up on the Internet to buy from dealers in other towns where nobody will do business with them.”
Freelance scam artists
Freelance scam artists also prey on trusting buyers.
Matt Sabatini, a banker and former car dealer from Wichita, Kan., said he was conned out of a $17,400 down payment in an auction on eBay Motors, the vehicle division of the vast online marketplace, by a seller with a stellar “feedback” rating and an apparently clean title to an H2 Hummer. It turned out that the thief didn’t own the vehicle and had inflated his feedback rating through the use of false identities, he said.
"If (eBay) had reported accurate information to begin with, I never would have done business with the guy,” Sabatini said.
The National Auto Auction Association, which represents wholesale auctioneers that sell to licensed rebuilders, also has concerns about accountability in direct-to-the-public Internet sales, said Michael Hayes, the group’s chief operating officer.
“The reason we have the integrity and the process at auction is we know our buyers and we know our sellers, and I’m not sure that happens at eBay Motors,” he said. “When you’re buying a $10 item that’s fine, but when you’re spending $35,000 to $50,000 on a vehicle, I think there should be more protections for the consumers there.”
Simon Rothman, vice president and general manager of eBay Motors, counters that the fraud rate in auto auctions is very low, mirroring the 0.01 percent reported by the parent company.
“There can be discrepancies between what buyers and sellers say (was represented) ... but when that happens they typically contact each other and resolve it together,” he said. “That’s how it works online.”
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