Beware of Phony Online Car Dealers

Follow these three tips to protect yourself from fraud when buying a car.

Scammers are creating Web sites with the names of real auto dealers and offering too-good-to-be-true deals on repossessed cars, according to the Better Business Bureau. People across the country already have lost thousands of dollars by buying nonexistent cars, according to BBB.

For example, Memphis dealership America Auto Sales ( received more than 1,000 calls from car shoppers who shopped on a phony site ( thinking it was Memphis dealership's site, according to BBB. Buyers were told to wire a deposit to an individual -- rather than the company -- and pay the balance when the car was delivered. The phony site claimed that this payment method would help the company avoid taxes legally. After paying, several victims called America Auto Sales to arrange delivery of their cars -- and some even showed up at the dealership.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

To continue reading this article
please register for free

This is different from signing in to your print subscription

Why am I seeing this? Find out more here

Cameron Huddleston
Former Online Editor,

Award-winning journalist, speaker, family finance expert, and author of Mom and Dad, We Need to Talk.

Cameron Huddleston wrote the daily "Kip Tips" column for She joined Kiplinger in 2001 after graduating from American University with an MA in economic journalism.