FBI warns of growing car-buying cyberscams

FBI says online car-buying scams have cost consumers $44.5 million since 2008

The FBI's Internet Crime Complaint Center (IC3) this week issued an alert about an online car-buying cyberscam that has been rearing its ugly head lately.

The FBI said that between 2008 and 2010, IC3 got nearly 14,000 complaints from consumers who have been victimized by online auto-buying scams. Victims report losing nearly $44.5 million, the FBI stated.

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The FBI describes the scam:

"Consumers find a vehicle they like -- often at a below-market price -- on a legitimate website. The buyer contacts the seller, usually through an email address in the ad, to indicate their interest. The seller responds via email, often with a hard-luck story about why they want to sell the vehicle and at such a good price.

"In the email, the seller asks the buyer to move the transaction to the website of another online company ... for security reasons and then offers a buyer-protection plan in the name of a major Internet company such as AutoTrader.com, Craigslist or eBay. Through the new website, the buyer receives an invoice and is instructed to wire the funds for the vehicle to an account somewhere. In a new twist, sometimes the criminals pose as company representatives in a live chat to answer questions from buyers.

"Once the funds are wired, the buyer may be asked by the seller to fax a receipt to show that the transaction has taken place. And then the seller and buyer agree upon a time for the delivery of the vehicle.

"Typically the ad the consumer sees is either completely phony or was hijacked from another website. The buyer is asked to move from a legitimate website to a spoofed website, where it's easier for the criminal to conduct business. The buyer protection plan offered as part of the deal is bogus. And the buyer is asked to fax the seller proof of the transaction so the crooks know when the funds are available for stealing.

"And by the time buyers realize they've been scammed, the criminals -- and the money -- are long gone."

The FBI said consumers should be alert for red flags including:

• Cars are advertised at too-good-to-be true prices;

• Sellers want to move transactions from the original website to another site;

• Sellers claim that a buyer protection program offered by a major Internet company covers an auto transaction conducted outside that company's website;

• Sellers refuse to meet in person or allow potential buyers to inspect the car ahead of time;

• Sellers who say they want to sell the car because they're in the U.S. military about to be deployed, are moving, the car belonged to someone who recently died, or a similar story;

• Sellers who ask for funds to be wired ahead of time.

Follow Michael Cooney on Twitter: nwwlayer8

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