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Feds warn consumers on phony online car sales

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Planning on buying a car through the internet? The Federal Trade Commission said on Monday consumers need to take precautions in order not to be scammed.

According to the FTC, scammers are trying to sell cars that they don't have or own.

In February, the Justice Department announced the indictment of 20 suspects involved in an online car sales scheme. Nearly 600 were victimized by the scheme, resulting in the loss of millions of US dollars.

The scam involves criminals posting advertisements for inexpensive used cars - cars they don't own - on websites. The scammers will then issue an invoice, requesting payments through payment methods that cannot be traced such as gift cards. The FTC says if you call the number listed on the invoice, you'll get a person pretending to work for a site such as eBay Motors.

Here are some tips from the FTC to protect yourself from becoming scammed.

  • You find bad reviews online. Check out the seller by searching online for the person’s name, phone number and email address, plus words like “review,” “complaint” or “scam.”
  • Sellers try to rush the sale. Resist the pressure. Scammers use high-pressure sales tactics to get you to buy without thinking things through.
  • They can’t or won’t meet in person or let you inspect the car. Scammers might have an excuse, like a job transfer, military deployment, or divorce, for why you can’t see them or the car. But experts agree that you should have an independent mechanic inspect a used car before you buy it.
  • They want you to pay with gift cards or by wire transfer . If anyone tells you to pay that way, it’s a scam. Every time.
  • The sellers demand more money after the sale for “shipping” or “transportation” costs.
  • The Vehicle Identification Number (VIN) doesn’t match the VIN for the car you’re interested in. A vehicle history report can help you spot such discrepancies.