Please be very careful of a car scam that involves used cars and Ebay. The set-up is you find a car that’s a great deal and when you contact the owner he tells you he will sell it to you through Ebay Motors. Then you find out that the vehicle is no longer listed on Ebay so they tell you that you can not purchase it there. At the same time the seller sends you an invoice via email and tells you to make payment via a money gram to an agent that has been assigned to you. This is a scam and you need to run, not walk away from this!
The Bombard Car Company in Skaneateles NY has agreed to pay $20,000 in restitution, fines and penalties due to their illegal and misleading advertising activities. Apparently ads for Bombard included a $3,000 check voucher good towards a used car. In another ad they offered $4,000 in cash-back savings towards the purchase price of a car.
If you’re asking what’s wrong with these ads? Simple, you see they increased prices to compensate for the savings, the ads were lies. In these tough economic times car dealers are desperate and the Bombard Car Company pulled one of the oldest retail scams ever, raise your prices while advertising a discount off the new inflated price. The easiest way to avoid falling for this type if scam is to know what the right price is for the car you are shopping for, if you don’t know the price you’re subject to a ‘too good to be true’ scammer like the Bombard Car Company!
Car dealers around the world are facing the same tough obstacles, a shrinking customer base coupled with an inability to get the few shoppers who entire showroom bought with a car loan. It’s a real terrible 1-2 punch. And desperate times call for desperate measures. I have been reading about how in Ireland clocking cars seems to be a popular revenue source for Irish car dealers. If you are not aware, clocking a car refers to rolling back the odometer. A car dealer does this so they can buy a car with 70,000 miles, roll the odometer back to 40,000 miles and sell it for a much greater profit because the buyer thinks there’s far few miles on the car than it actually has.
Apparently, clocking cars is a big problem now in Ireland. That is not to say that it does not happen here in the USA because it does, a lot! If you are shopping for a used car you should know that because car dealers are facing hard times practices like clocking are very appealing, even though I am sure it is illegal in all 50 states. Clocking is a way for a dealer to make some fast, easy money. This also applies to people who are selling their personal vehicles.
So how do you avoid being a victim of this crime? Simple, when you find the used car you want to buy write down its VIN (vehicle identification number) number. Every car has a unique VIN number. Then go to CarFax.com and put the VIN number in and for a nominal fee you will get a full record of that car’s history including the number of miles on the car each time it was re-registered. So if you are thinking of buying a car with 40,000 miles and you see it was registered with 55,000 miles you know this is a car that has been clocked. You might also find that the VIN number on the car does not match the car you are considering. Also, there may be a problem if the VIN number does not match ANY car. That’s because people who clock cars often also tamper with the VIN numbers (another crime, but we are not talking about ethical people). Obviously if there are any discrepancies or questions developed from your CarFax you know not to buy that car.
Regular readers of this blog know that there can be serious ramifications as the result of illegal and unethical actions done by a crooked car dealer, but thankfully death is not usually one of the results. Sadly, that is not the case on Long Island, NY.
Apparently two Lawrence NY car dealerships have been involved in illegal activities to help drug dealers, pimps and gang members obtain luxury cars while keeping their names off the DMV records. The police initiated this investigation after a 2007 shooting death. These dealerships conducted all the usual crimes like identity theft and financial shenanigans to conduct this type of illegal activity. I bring this story to your attention to drive home the point that there are many dealerships around the country involved in illegal activities and if you are not careful in your dealings you will be a victim too!
It would be nice if we could walk into a car dealership and expect that you are doing business with an honest, above-board local business person. Unfortunately that is not the case. I am not accusing all car dealers of being crooked or unethical, that would not be an accurate statement. But, there are so many car dealers out there from coast-to-coast who are doing unethical and often illegal acts you must carefully and scrutinize everything you do with them!
For instance, Suzuki Auto Plex in Lincoln, Nebraska is a dealership that has consistently run afoul of the law. In fact the owner, Chadron Gutschow recently had his license to sell new vehicles taken away by the state. It’s the usual story; he was holding titles, failing to pay-off loans on trade-ins, double charging customers for things like extended warrantees all the usual scams. Mr. Gutschow is your typical low-level crook.
Thankfully the state has taken away his license… kind of. He can still sell used cars, allowing him to pull his scams on those people. And to make matters worse, he has sold his license to his father! That solves the problem. Great, has anyone at the Nebraska DMV heard the expression, the apple doesn’t fall far from the tree? In my opinion it won’t be long before it is business as usual for Suzuki Auto Plex and that’s bad news for the unsuspecting people of Lincoln, Nebraska!
Remember, there are people like Chadron Gutschow in virtually every town and city so you must be careful. Know what paperwork you need from the dealership and get it! If the structure of your car deal requires the dealer to pay off your previous loan call that bank and make sure they are paid off, it’s important for your credit history! If they ask you to sign something read it first. Be smart and shop smart!
When someone’s so sleazy and so dishonest you must realize that it’s impossible to beat them at their game so you MUST steer clear of them at all costs. Recently the parent company of Wildcat Mitsubishi located outside Tucson Arizona, Ideal Automotive Group declared bankruptcy. This is not an unusual story until you dig a little deeper.
You see, the heat on this group of dealerships has been getting hotter and hotter and it’s not because they are in the desert. They owed $1.3 million in taxes while have $7 million in unsecured debt. Wait – it gets worse! They were also under extreme pressure from the Arizona state government because of shady and illegal business practices that included selling damaged vehicles, filing false documents, selling salvaged vehicles and calling the police on customers.
How bad is it to do business with the Ideal Automotive Group owned by the Johnson family? Since May the state had barred them from selling vehicles to Fort Huachuca soldiers! Wow, I’ve heard of a lot of bad dealers but I’ve never heard of a state barring a dealer from doing business with a group of people. Yet the saddest part of this story is the fact that with the government hot on their heels it looks like they declared bankruptcy to provide protection from the upcoming fines the state hoped to levee against them. You just can slither with snakes!
I relay these stories to my readers to stress a very important point; you must be careful who you do business with. There are dealers all over America who are as crooked and dishonest as anyone can be. These criminals make their money on the uneducated buyer. If you happen to walk into one of these dealerships without a sound plan, without an idea how to navigate through their deception and tricks you are almost assured to leave there with thousands of dollars fleeced from you. Nobody moves better on their bellies than snakes, so don’t try and slither with them!
I am constantly surprised by the number of people who get burned by car dealers after entering into some kind of ‘special’ business dealing. The classic example of a ‘special’ kind of business dealing is making a deal with dealer to sell your car on consignment. In theory it should be a win-win situation for both of you. But if a car dealer can win more by you losing, count on the results being: they win big… you lose. A car dealer doesn’t take money from their pockets and put it in yours. For people who expect this to happen there’s an old expression, ‘pigs get slaughtered.’
Here’s another case of someone trying to get money from a car dealer and ending up with nothing but a headache. A gentleman named Jay Paul Deratany, a practicing attorney in the Chicago IL area visited Gold Coast Bentley to purchase a 2004 Porsche Cayenne. After having a discussion with a salesperson at the dealership, Mr. Deratany decided to put a $10,000 deposit down on a limited edition 2006 Bentley convertible. Since then Mr. Deratany has been unable to get his car or persuade the dealership to refund his deposit, so he is suing Gold Coast Bentley.
Hold on a moment, here’s where this story provides a learning lesson. When Mr. Deratany put the deposit down he was lead to believe he would be able to buy the car or make a profit from his deposit if the dealership sold his reservation to someone else willing to pay more for the car. Ladies and gentlemen, let me explain this as clearly and concisely as possible, you do not walk into a car dealership and leave making money. Car dealerships are not in the business of giving you money. In fact, their business model is 180 degrees in the other direction, they want to take as much money as possible from you, and that’s why they have Mr. Deratany’s deposit and possibly several other people’s money.
Now don’t get me wrong, Mr. Deratany does not deserve to have his money stolen from him, but remember what happens to pigs…. Here’s what you can learn from Mr. Deratany’s problem, do not walk into a car dealership expecting to find someone who will help you financially. No matter how nice they are, no matter how persuasive they can be, you must remember the car dealer’s sole purpose is to take as much money as possible from you. Protect yourself and shop smart.
Everyone knows we are facing tough times, and it’s even tougher on car dealers who are facing huge financial loses every month. The financial pressure these dealers are under is enormous and as the expression goes, ‘desperate times call for desperate measures’. Well, I’m seeing dealers commit some horrific scams and crimes to get you’re your money. Today’s bad dealer of the day is Bill Heard Chevrolet in Houston Texas.
The folks at Bill Heard Chevrolet are under investigation for a multitude of crimes and offenses. The local police are very familiar with this dealership and its business practices because dozens of Bill Heard Chevrolet shoppers have felt so wronged and mislead that they have called 911 from the dealership! Now, the dealership is being investigated for forgery and forced delivery of an unwanted car. This is truly unbelievable, in all my years of working in this industry I’ve never heard of such a blatant abuse of a car shopper, here’s the story.
A woman went into Bill Heard Chevrolet and took a car for a test-drive and filled out a credit application. She decided not to buy the car. It should have ended there, but it didn’t. Someone at Bill Heard Chevrolet forged documents in this woman’s name to secure a loan to buy the car she test drove. The loan went through with Chase (a bank) and they registered and plated the car. Now they brought the car to the woman’s house and parked it on the street in front of her home with all the paperwork sitting on the passenger’s seat. They couldn’t park it on her property, so they left it in front of her home! Several days went by and the woman received a phone call from the police threatening to impound her car parked out on the street.
This is how this poor woman found out that she’d been scammed by Bill Heard Chevrolet. She contacted the police and Chase, who upon reviewing the paperwork determined that certain signatures didn’t match. Chase voided the loan and forced the dealership to buy back the car. So thankfully there was a happy ending to this story.
Now if you’re shopping for a car, be VERY careful. You do not need to fill out a credit application to take a test drive. You DO need to provide a dealership with a copy of your driver’s license, but not a credit application. If a dealership requires you to fill out a credit application prior to a test drive there’s something wrong! The only reason you need to complete a credit application is when you have decided you want to purchase a car. Remember, you’re taking a test drive to decide if you want to buy the car. Be careful and shop smart.
I have not been crying wolf with my blog entries warning people of the dangers of title fraud. Here’s a case of thirty people getting scammed by a car dealer and now they are in big trouble! In Castle Rock CO., near Denver there are 30 people who have paid for a car, never received their titles and now the dealership is closed and the owner’s nowhere to be found! To read the whole story click here. I’ll give you a quick overview; a high-end dealership in Castle Rock is now closed and abandoned leaving 30 customers without titles to the cars they paid for. The reason the customers do not have titles is because the dealership never purchased the cars they sold to these customers! So this shady car dealer sold people cars he didn’t own (and fake extended warranties along with not paying off any trade-ins). This crook of a car dealer conducted transactions he never intended to complete and then disappeared. Police are looking for the dealer principle, Wayne Weaver, but no one can find him. My guess is Mr. Weaver was able to get out of town with at least a million dollars of other peoples’ money!
As I’ve told you in multiple blog entries, this is a scam that’s very easy for a car dealer to commit. Car dealerships sell new and used cars every day without having the vehicle’s title. What honest operators do is after the dealership sells a car they obtain the title and transfer ownership to their customer. But if you are a crook like Mr. Weaver, you begin the transaction and split without paying anyone off. In 2008 we are going to see this type of fraud reach epidemic proportions as dealers are buried in debt so you MUST protect yourself.
There are countless scams a car dealer can pull on you and while we are dealing with the toughest economic conditions we’ve faced in decades, you can not be too careful. I’ve mentioned in previous blog entries the dangers associated with title fraud along with the hazards of having a dealer not pay off your trade-in. Title scams and dealers who hold onto customers money with the intent of getting interest free loans or to use as a parachute for bankruptcy are on the rise and will become more common as long as our economy stagnates.
But, desperate times often create a desperate situation and that’s exactly what happened in Waynesboro, Virginia. Rodney Price, owner of RSD Motors has been charged on over 40 counts that include failing to issue titles to vehicles, improper registration, disposing of mortgaged properties, obtaining money under false pretenses and embezzlement. Mr. Price faces both misdemeanors and felony charges and seemed to take enormous liberty with other people’s money and property. Unfortunately this is far from the first time I have heard of car dealers committing these crimes and it will not be the last.
While Mr. Price was committing these frauds he showed NO concern for anyone. The damages to innocent people who had the misfortune of coming into contact with Mr. Price could have been much worse. For example, it appears that a Mr. Dale Early made arrangements with Rodney Price to sell his 2004 GMC Sonoma on consignment (a practice I strongly discourage) at his dealership. The truck was sold, but Rodney Price decided to stick it to Dale Early. Instead of registering the truck in the new owner’s name, Rodney allowed the new owner to drive the 2004 GMC Sonoma on Mr. Early’s insurance and plates for 2 months.
My guess is by letting the new owner of the 2004 GMC Sonoma drive around on Dale Early’s insurance and plates Rodney put a few hundred dollars in his pocket. But, had the new owner of the Sonoma been driving drunk and killed someone, Dale Early might have found himself in jail, or at the very least he would have spent hundreds of thousands of dollars to avoid jail. Rodney Price put Dale Early in danger of losing his home, his savings, his good name and just about everything he’s worked his whole life for.