Story Created:
Jul 28, 2009 at 6:25 AM CST
Story Updated:
Jul 28, 2009 at 6:25 AM CST
(July 28, 2009)
Main Topic: VIN cloning—which targets used car buyers—is on the rise. Consumers must do their research.
As more families look to stretch their dollar, buying a used car, instead of new, is increasingly popular. Unfortunately, some law enforcement are reporting that VIN cloning—which targets used car buyers—is on the rise and Better Business Bureau advises car buyers to do their research or they could unknowingly purchase a stolen car.
One scam that specifically plagues used car buyers is VIN cloning, which is essentially auto identity theft used by car thieves to unload stolen cars. According to the most recent numbers from CARFAX, as many as 225,000 of the 1.5 million cars stolen every year have been subjected to VIN cloning.
Unlike most scams, VIN cloning has two victims. The first is the victim who had their car stolen and the second is the unsuspecting buyer. When the police track down the stolen car, they’re going to give it back to the rightful owner and the new owner will suddenly have no car or a way to get his or her money back.
A car’s vehicle identification number, or VIN number, is a unique number that serves as a way to recognize a specific car. The number is also used by law enforcement to track down and flag stolen cars. For this reason, car thieves will “clone” a stolen car’s VIN number to match that of a car that isn’t stolen.
Sometimes the thieves will punch out a new VIN and replace the stolen vehicle’s dash VIN with the new one or they use computer technology to print out authentic looking documents with phony VINs. The last step is selling the vehicle, usually through classified ads or other informal methods.
BBB recommends taking the following steps to avoid becoming a victim of VIN cloning:
- Be extremely cautious if you see a late model luxury car or SUV selling significantly under normal market price.
- Do not fall for the “we need cash quickly” excuse.
- Check the VIN number on the dashboard, inside the door jamb and under the hood against the car’s title documents for discrepancies.
- Closely examine the car’s title, registration and other documents. Fake documents sometimes contain misspelled words.
- If you still have questions about the validity of the vehicle’s VIN, obtain a comprehensive vehicle history report.
- If you believe your car has been cloned—one giveaway, according to the FBI, is if you receive a notice for unpaid parking tickets—contact your local law enforcement.
Scheme of the week: Warrantech's Extended Warranty Customers Say Their Contracts are Full of Loopholes
Purchasing an extended warranty or service contract for your prized possessions (your home, your car, and your expensive appliances) in case they are damaged can bring a consumer peace of mind. But that peace of mind can be broken into little pieces if a consumer purchases that contract from the wrong company.
One Bedford, Texas based company attracting consumer wrath is Warrantech Corporation. The company provides service contracts and after-market extended warranties on automotive and consumer products in the United States and internationally. BBB has received 454 complaints on Warrantech in the past 36 months and has a BBB rating of F. Factors that contribute to the F rating are the number of serious complaints filed against the company, as well as government action taken against them by the South Carolina Department of Insurance.
BBB offers the following tips when a consumer is on the fence regarding the purchase of an extended warranty or service contract:
Don’t Be Fooled.
Salespeople will often use the terms extended warranty and service contract interchangeably, but there is a distinction.
Read the Fine Print.
As with any contract, make sure to read the fine print of both the manufacturer’s express warranty and the extended policy. Usually a consumer can even take the policy home to read it closely and sleep on the decision.
Shop Around.
Different retailers will offer different policies, so if buying an extended warranty or service contract is important, visit several retailers and find out which offers the best value.
Consider the Cost of the Product.
When considering an extended warranty or service plan, it’s important to consider the cost ratio of the policy and the product. It may not be worth it for a consumer to pay $50.00 for a policy to cover a $120 DVD player. Consider and calculate what it would cost for average repairs over the specified time period of the contract and compare it to the total cost of the service contract. If the product has a good track record for reliability, then the service contract could end up costing more money.
