Motorists warned to lookout for new lockdown car-related scams
- New lockdown rules coupled with economic uncertainty, create perfect conditions for fraudulent activity.
- Motorists urged to guard against fake vehicle sales, insurance broker fraud, DVLA scams and staged car accident fraud.
- GoCompare shares tips to help people avoid falling victim to fraudsters.
GoCompare is warning motorists to be vigilant amid new concerns that economic uncertainty, coupled with tightened lockdown measures aimed at preventing a second wave of the pandemic, will increase fraud.
Restrictions have increased the amount of time people spend online managing their affairs. This has attracted cybercriminals who are targeting the sale of vehicles though digital sales platforms or are impersonating genuine organisations, including the DVLA, to steal victims’ money, personal information or to get them to click on links which may contain malware.
The pandemic has also meant that many people are having to manage on much reduced income – making them more vulnerable to fraudsters offering enticing deals.
Online sales and purchase scams
Fake car sales listings
Fake listings copied from legitimate car sales adverts are used to attract buyers, citing coronavirus restrictions as the reason the car can’t be viewed in person. The fraudsters offer to deliver the car once money has been placed into a holding account, assuring the would-be buyer that the cash will not be released until they have seen the car and agreed the purchase. Victims are often lured by too good to be true deals and hand over large deposits to secure the vehicle. The fraudster then immediately banks the money, leaving their victim with nothing.
Vehicle matching scams
Fraudsters cold call someone who has just placed an advert to sell their car, claiming they have an immediate buyer for the car. They then ask the seller for an upfront fee, which is refundable if the car does not sell. The car is not sold and, the refund is never paid.
Insurance broker fraud (also known as ‘ghost broking’)
Scammers pretend to be legitimate insurance brokers to sell forged or invalid car insurance policies. Motorists are lured by the promise of cheap premiums. Fraudsters ask their victims for an upfront ‘arrangement fee’ to secure the deal.
Victims of ghost brokers are usually unaware they are not insured until they submit a claim following an accident or are stopped by the police for driving without insurance. In some cases, ghost brokers also retain the victim’s card details and use these to pay for other victims’ insurance.
Earlier this year DVLA warned of a 20% increase in fraudulent activity. Cybercriminals posing as the DVLA issue text message and email scams and set-up fake websites. Official looking messages will have links asking for payment details to rectify failed vehicle tax payments or advising victims that they are due a vehicle tax refund while the websites attract motorists looking for the DVLA site to renew their driving licences.
Criminals have also duped drivers into paying for services that do not exist. Scams have included selling driving test passes and payment to remove penalty points from driving licences.
Crash for cash scams are run by criminals who stage accidents by targeting an innocent driver to become the ‘at fault driver’, to profit from fraudulent insurance claims. Common tactics include deliberately slamming on the brakes to ensure the vehicle behind crashes into them or ‘flash for cash’ scams where criminals wait for victims to exit from side roads, and flash their headlights, appearing to offer the victim a right of way to join the flow of traffic. Once the victim commits to exiting the criminals speed up and hit them side-on.
The aim is to make as much money as possible from exaggerated claims, with proceeds often used to fund more serious crimes.
Fleur Lewis, Head of Fraud at GoCompare commented, “COVID-19 has changed the way we live and an increasing number of people are managing everyday activities, including shopping for goods and services, online – many for the first time. Criminals are exploiting the situation. Since lockdown was first introduced, there have been big increases in reports of cybercrime and other fraudulent activities.
“The new tightened lockdown rules introduced in a bid to prevent a second wave of the pandemic coupled with continued economic uncertainty, create perfect conditions for fraudulent activity. So, we’re urging people to be extra vigilant.
“Scams are becoming increasingly sophisticated and using the internet, criminals often conduct frauds by pretending to be a brand or an organisation you trust, which can make them difficult to spot. The good news is that from making sure the security on online devices are up to date to being able to recognise common tactics employed by fraudsters - there are steps you can take to help avoid falling victim to fraud.”
Last year, GoCompare also became the first comparison site to join the Insurance Fraud Bureau (IFB), a not-for-profit organisation that acts as a conduit of information for the insurance industry to help fight against fraud. To combat the rise in fraud, the IFB has launched a national campaign, called ‘Stop the Scams’, to help the public spot signs of scams and report them to the Insurance Fraud Bureau (IFB) Cheatline.
Ben Fletcher, Director at the IFB, said:
"Motor fraud is the most common type of insurance scam and the disruption of Covid-19 is sadly providing even more opportunities for fraudsters to target the public. We must do more which is why we’ve launched an industry-backed ad campaign called Stop the Scams to help the public spot signs of insurance fraud. If anyone has any information about a known or potential insurance scam they can report it to the IFB’s Cheatline* - their information could help to launch an investigation.”
GoCompare has provided the below tips to help avoid falling victim to fraud:
- If a deal looks too good to be true, it usually is. For example, cars being put up for sale at a much lower price than others of the same make, model, and mileage. Or offers of very cheap insurance advertised on social media or websites.
- Are you being pressured to act (e.g. 'within 24 hours' or 'immediately')? Fraudsters often use threats of fines, deadlines or time-limited offers to pressure victims into responding.
- Be aware of and don’t respond to emails or texts asking for your personal details or unsolicited proposals offering easy money. For example, the DVLA doesn’t send text messages with links asking for payments nor does it text drivers advising of a tax refund.
- Think carefully about the information you share on social media and review your privacy settings Publicly available information about you can be used by criminals to make their phishing messages more convincing.
- Make sure your online devices and apps are regularly updated with the latest software, which usually contain important security updates.
- Avoid clicking on links in emails. Go to the company or organisation’s website by entering its address directly into your browser.
- Ensure you always use a secure website when you need to enter confidential or sensitive information. Look for addresses beginning "https://" and not "http://" and the small padlock symbol. If, your browser displays a security alert indicating that the site is not trusted, don’t go any further.
- If you suspect that you have been contacted by, or have fallen victim to a fraud, you can report it to Action Fraud at actionfraud.police.uk / 0300 123 2040
For further information please contact:
Gordon, Jason or Liz at MAW Communications on 01603 505 845
Keep up-to-date with GoCompare on Twitter; @GoCompare
Notes to editors
*IFB Cheatline, provided by the IFB:
Evidence of an insurance scam can be reported to the IFB’s confidential and anonymous Cheatline (powered by Crimestoppers) on 0800 422 0421 or online. The IFB uses information from Cheatline reports to work with insurers, the police and industry watchdogs to help fight fraud, keep people safe and keep costs down.
GoCompare is a comparison website that enables people to compare the costs and features of a wide variety of insurance policies, financial products and energy tariffs.
GoCompare does not charge people to use its services, and it does not accept advertising or sponsored listings, so all product comparisons are unbiased. GoCompare makes its money through fees paid by the providers of products that appear on its various comparison services when a customer buys through the site.
When it launched in 2006, it was the first comparison site to focus on displaying policy details rather than just listing prices, with the aim of helping people to make better-informed decisions when buying their insurance. GoCompare has remained dedicated to helping people choose the most appropriate products rather than just the cheapest, and has teamed up with Defaqto, the independent financial researcher, to integrate additional policy information into a number of its insurance comparison services. This allows people to compare up to an extra 30 features of cover.
GoCompare is the only comparison website to be invited to join the British Insurance Brokers’ Association (BIBA) and is authorised and regulated by the Financial Conduct Authority (FCA).