Warning over car-buying scam

Car sellers who receive a cheque payment for a vehicle are being urged to hold onto the car until the money has cleared following a spate of scams in the Auckland region.

Police are warning people to beware following more than 50 reports in the past 12 months from vehicle owners who have been duped out of their cars after listing them on Facebook Marketplace.

Nine people have been charged with dishonesty offences in relation to these cases and further investigations are taking place.

Detective Senior Sergeant Callum McNeill says police want the public to be wary of the risks of dealing with cheques and the potential pitfalls of selling vehicles on unregulated websites such as Facebook Marketplace.

“Police have noticed a significant increase in reports from victims in these scams in the past year and we take these matters seriously,” he explains.

“We want the community to be cautious when accepting payments by cheques. You should not hand over possession of your vehicle until the payment has been cleared and is no longer showing as pending in your bank account.”

Members of the public complaining to police have reported a person has bought a vehicle from them after it was listed on Facebook Marketplace. The purchaser has paid the owner by cheque and the funds have appeared as “pending” in the seller’s bank account.

Police say the cheques were subsequently dishonoured or reversed due to insufficient funds three to six days later, by which time the scammer has taken possession of the vehicle and has usually on-sold it to someone else.

Attempts by victims to contact the scammer normally fail because the offender has blocked them or deactivated their Facebook account

McNeill advises sellers to use regulated online marketplaces such as Trade Me or other online car auction platforms.

Antonia Sanda, a spokeswoman for Facebook, says the social media giant is sorry to hear what has happened.

“We encourage people to contact their local police department if they feel they were the victim of a crime, and we echo the advice the police have given about being cautious when accepting payments by cheques,” she adds.

“We do not allow scams on our services, and we take swift action to remove them as soon as we become aware.”

Trade Me also recommends sellers take extra caution if they receive cheques from buyers and wait until they have the money in their account before completing any deal.

Lisa Kerr, head of trust and safety at Trade Me, says: “While cheques are becoming less common these days, it's important to be aware that cheques can be dishonoured several days after they are deposited and shouldn’t be treated the same as cash.

“If sellers are given a cheque as a form of payment, we strongly recommend that sellers hold onto the item until the money has cleared.” 

Kerr explains Trade Me has a team of 30 New Zealand-based people who monitor its site seven days a week to help keep members safe and minimise the risk of consumers being exposed to scams.

“You’d be a mug to do anything dodgy on Trade Me, you leave deep electronic footprints on our site which can be traced,” she says. 

“We have sophisticated systems and processes in place to keep our site trusted and safe. On the rare occasion when a trade goes wrong we have a dedicated disputes team on standby to help.”