Online Scam Dealers Multiply

Publisher Martin called and said, “You’ve got to talk to our friend ‘Mark.’ You won’t believe what he’s gotten into now!”

Martin had made a huge impression on Mark, telling him how his Mercedes-Benz SL55 AMG was the best thing since sliced bread. So Mark started digging around on the internet and located a great-looking website that advertised a 2008 SL55 at an attractive $35,000 price, including shipping to his home. The listing contained a number of photographs, as well as thorough information about the car.

Mark contacted the Dallas, TX, dealer — we’ll refer to it as “AutoScam.com” — and was happy to get a call back from an engaging sales guy who insisted the car was every bit as good as it looked in the photographs. Mark’s request for a PPI was met with, “Why bother? Every car we sell comes with a no-hassle, seven-day refund policy. If there is anything wrong with the car, just call me up and we’ll take it back for a full refund.”

That made Mark comfortable with the deal and he agreed to wire the purchase price in full. He quickly received an email with appropriate used-car disclosures, wire-transfer instructions to Chase Bank, and a seemingly legitimate sales agreement that contained all the agreed-upon terms. Mark used the provided DocuSign link to sign the contract.

He then contacted his bank to order the $35,000 wire. However, it was too late in the day for the wire to go out, so the banker promised to send it the next morning.

Cold sweat

Mark had trouble falling asleep that night. Something about the deal was bugging him, so he went to his computer to do some further research. Searching for reviews of the dealer, he found Trustpilot (www.trustpilot.com), an internet review site that offers user reviews of various businesses. It had some reviews of AutoScam.com.

Mark was initially comforted by the numerous five-star testimonials about how happy people were with AutoScam.com and the great deals they got on their great cars. But then he came to a few one-star reviews that shocked him. The reviewers labeled the website a scam, warning people to stay away because they don’t actually have any cars and just take your money and disappear.

Suspiciously, all the posts for AutoScam.com were either five-star or one-star reviews. There were none in between. Even worse, all the reviews had been posted within the previous two months — nothing earlier. Obviously, the testimonials were fake, and the warnings were accurate.

Stolen listings

Since the SL55 listing included a VIN, Mark copied and pasted it into an internet search. This was smart (and should be the first step in researching any new-car purchase). He found a closed Bring a Trailer listing for the same car, with the exact same photos, text and everything. The car had recently sold for more than he was paying for it.

That brought full meaning to two of the negative posts on Trustpilot. One said, “[AutoScam.com] has my car listed for sale in Dallas, TX, which is obviously a scam since it’s owned by me and in my garage. The pictures are from three years ago when I purchased it.” The other read, “I am the owner of a particular car I bought on Bring a Trailer nearly two years ago. That car is now listed on [AutoScam.com] using all of the photos and info from the Bring a Trailer auction listing. It looks like there are other Bring a Trailer past listings copied as well. When I responded to the listing [I] got an automated response saying the car is still available, in mint condition, and has been through a thorough inspection.”

Digging deeper, Mark found that every AutoScam.com listing he examined had been copied from BaT. They say that imitation is the sincerest form of flattery, but this goes way beyond that.

Shocked by his discovery, Mark got little sleep that night. He was wide awake when the bank opened, and he immediately called to cancel the wire.

He also called AutoScam.com to confront the friendly salesman and left a message that was never returned. He then called Chase Bank, trying to reach its legal counsel to warn it about how it was being used by scam artists. He then called the FBI to lodge a complaint, again leaving a message. As of yet, nobody has responded.

Mark signed up on the Trustpilot website and immediately posted a negative comment about his experience. Soon after, the SL55 disappeared from the AutoScam.com website.

Too easy

This is a clever scam, but not really all that hard to pull off. There are numerous vendors who will sell you a complete auto-dealer website package, ready to be filled in with your data. Copying listings out of BaT or other similar sites is simple. Creating fictitious business entities is neither difficult nor expensive. Judging by the comments on Trustpilot, these scammers open bank accounts at multiple banks, use them one at a time, and close each one after each fraud is completed. Phones and voicemail systems are cheap. You could actually be anywhere in the world as you do this.

I called Randy Nonnenberg, co-founder and president of Bring a Trailer, to see what he knew about this. “This isn’t the first time we’ve seen phony stuff like this, but I wasn’t aware of this particular one. Unfortunately, copying and pasting photos and text off the BaT site, or any other, isn’t hard to do,” he said. “There isn’t much that we can do about it. Some of our sellers add watermarks to their photos to prevent copying, but that isn’t a great look and most don’t.”

More fraud

Mark was saved by Trustpilot, a global consumer review platform headquartered in Copenhagen, Denmark, that has additional locations in other European cities, New York and Denver. It differentiates itself from other review sites because of its “open” nature. That is, it allows anyone with a genuine experience to post reviews on its site, so long as standard guidelines are met. Other “closed” sites differ in that the businesses decide which reviews are posted.

“Legal Files” alerted Trustpilot to Mark’s situation and the fraudulent reviews. We received this response: “We work incredibly hard to protect the integrity of the Trustpilot platform and use both automated fraud detection technology together with highly trained experts — as well as our community of reviewers and businesses who have the tools to act as whistleblowers — to tackle fake reviews. If we identify violations of our guidelines and attempts to manipulate the platform, we do not hesitate in taking action.”

A follow-up came the next day: “…our specialist Fraud & Investigations Team has found evidence to suggest several reviews on the business’s Trustpilot page were fake. As a result, and in line with our processes, we have removed all suspected fake reviews and have placed a Consumer Warning at the top of [AutoScam.com’s] Trustpilot page, alerting consumers to the business’s misbehavior.”

A few hours later, we received another email stating that Trustpilot had restricted AutoScam.com’s access, limiting it to replying to and reporting reviews only, and had stopped sharing its reviews with search engines. Trustpilot had informed the supposed dealer about its enforcement action and said it would be continuing its investigation.

Protect yourself

If you are tempted to buy a car on the internet, take the time to check out an unfamiliar seller. Review sites are helpful, but go further and make sure the seller really has a brick-and-mortar facility somewhere. Either go see the car yourself or send someone you trust to do it for you. Always insist on a prepurchase inspection by a knowledgeable shop of your choice. Never skip any of these steps!

Meanwhile, Mark continued to look for his SL55. Within days he found another website that offered a great-looking car at an attractive price. Now knowing what to look for, he determined that all of its listings had also been purloined from BaT. And then he found another. And another ... ♦

John Draneas is an attorney in Oregon and has been SCM’s “Legal Files” columnist since 2003. His recently published book The Best of Legal Files can be purchased on our website. John can be contacted at [email protected]. His comments are general in nature and are not intended to substitute for consultation with an attorney.