TORONTO, Oct. 16, 2013 /CNW/ - An upsurge in online targeting of
newer-model and luxury car buyers is emerging as a new and dangerous
trend among unlicensed dealers (curbsiders) and fraudsters, recent investigations by OMVIC (Ontario Motor Vehicle Industry Council) reveal. The Ontario regulator
of vehicle sales warns vehicle-buyers to be vigilant for illegal online
sellers and fake out-of-province sellers offering high-end cars, SUVs
"This represents a change in strategy by curbsiders and fraudsters," says OMVIC Manager of Communications and Education
Terry O'Keefe. "Curbsiders, unlicensed dealers who usually pose as
private sellers, used to target buyers of inexpensive reliable economy
vehicles. Now, we're seeing a shift towards newer and high-end vehicles
such as Mercedes, BMW, Lexus, and even newer-model pick-ups, which
command higher prices and higher profit margins. Unfortunately, just as
curbsiders commonly misrepresent themselves, they also misrepresent the
vehicles they sell, which are often insurance write-offs,
accident-damaged or odometer-tampered."
This means car buyers have to be doubly vigilant: lurking in online
classifieds are not only curbsiders, but also out-right fraud artists
operating fictitious dealerships supposedly based in the U.S. These two
trends are converging when it comes to car-buying rip-offs. "Anyone
considering buying privately or from a seller located outside Ontario,
including U.S.-based dealers, must be extra vigilant. Consumers should
understand they are only protected by Ontario's consumer protection laws when they buy from an OMVIC-registered dealer. If they buy privately or outside the province and something goes
wrong, OMVIC can't help," adds O'Keefe.
Earlier this year, OMVIC warned all Canadians about phony dealerships
supposedly based in the U.S. These "dealers" targeted Canadians by
advertising in Canadian online marketplaces, offering high-end and
exotic vehicles at attractive prices. The fake dealerships had polished
websites and phony reviews for the dealerships on numerous other
websites. "Unfortunately neither the dealerships nor the cars they
purported to offer existed. We know of numerous victims who lost tens
of thousands of dollars each," said O'Keefe. These online techniques
persuade even smart yet strongly motivated buyers to drop their guard
and chase the great buy they've always dreamed of owning. And, online
often means the crimes are borderless and faceless so it's much more
difficult to verify and catch criminal activity.
A survey carried out for OMVIC highlights a heavy reliance by car buyers
on online sources of information: 40 per cent visited a dealer website;
34 per cent visited an automobile-specific classifieds site (e.g.,
autotrader.ca); and 23 per cent relied on other online classifieds
(e.g., Kijiji, Craigslist).
Research from the Used Car Dealers Association (UCDA) last year found
that almost one-third (29 per cent) of vehicle ads on online sites were
placed by curbsiders. "They've mastered using the Internet to make
their appeals look professional and authentic," O'Keefe emphasizes.
"Often their vehicles are priced below market value. Consumers should
see this as a warning, not an opportunity."
OMVIC's research also noted that a high percentage of Ontario car buyers
are willing to risk losing a lot of money and accept the risk
associated with curbsiders: 43 per cent said that knowing consumer
protection is only available when buying from an OMVIC-registered dealership would have no
impact on where they buy the next time.
"There seems to be a bit of a disconnect for some buyers," suggests
O'Keefe. "Even knowing they have no consumer protection doesn't stop
them from dealing with the riskiest sector of the automotive
Under Ontario law, car buyers are only protected by consumer protection
legislation when they buy from an OMVIC-registered dealer. This
all-in price advertising with no hidden fees
mandatory full disclosure of a vehicle's past use, history and condition
cancellation or rescission rights if specified information is not
access to the Motor Vehicle Dealers Compensation Fund.
Consumers are encouraged to take OMVIC's new car-buying quiz to learn more about their rights when it comes to vehicle purchases.
The quiz and other valuable resources can be found at BuyWithConfidence.ca.
OMVIC (Ontario Motor Vehicle Industry Council) administers and enforces
the Motor Vehicle Dealers Act (MVDA) on behalf of the Ministry of Consumer Services. OMVIC maintains a fair and informed vehicle sales marketplace by
regulating dealers and salespersons, regularly inspecting Ontario's
8,000 dealerships and 24,000 salespeople, maintaining a complaint line
for consumers and conducting investigations and prosecutions. OMVIC is
also responsible for administering the Motor Vehicle Dealers Compensation Fund on behalf of its Board of Trustees.
SOURCE: Ontario Motor Vehicle Industry Council (OMVIC)
For further information:
Manager of Communications and Education
H2 Central Marketing & Communications