OFFICE OF FAIR
TRADING News Release (61/09) issued by COI News Distribution Service
on 28 May 2009
OFT, police,
Trading Standards, and industry launch action to drive out scammers.
The OFT is today warning consumers about vehicle matching scams
which cost UK consumers nearly £3 million every year.
Vehicle matching scams work by approaching consumers selling
their cars and promising falsely to match them with definite
buyers. Typically, the seller is cold-called by phone once they
have placed an advert in a magazine, on a website or in a
newspaper. They are promised that a buyer exists for their vehicle
but are required to pay a matcher's fee up front before the
sale is completed. However in many cases there is no buyer, the
contract with the vehicle matcher cannot be cancelled, and any
money paid is lost.
Last year over 1600 private sellers of second hand cars
complained to advice service Consumer Direct about the practice,
losing between £80 and £99 each, but the true number of victims is
thought to be much larger.
The OFT has co-ordinated the
sharing of intelligence between different enforcement agencies to
target action against traders engaged in unfair commercial
practices, assisted on enforcement action, and has organized a day
of action with the police, local authority Trading Standards
Services and consumer bodies to crack down on the car matching
scammers. As part of the action TSS officers are also due to carry
out inspections.
The OFT is also working with online and print
motoring publications and websites who are members of the Vehicle
Safe Trading Advisory Group - including Autotrader, Exchange and
Mart, eBay, Pistonheads and Motors.co.uk to put in place clear
and prominent warnings for consumers who put their cars up for
sale about these scams. The UK European Consumer Centre, European
Consumer Centre, Dublin, and Which? are also supporting the campaign
Mike Haley, OFT Director of Consumer Protection, said:
'Time is up for rogue traders who attempt to cheat sellers
with false promises of a guaranteed buyer for their cars. We are
working with the industry and enforcement partners across the UK
to crack down on scammers who are preying on consumers during the
economic downturn.'
Motor trade lead officer Peter Stratton, Trading Standards
Institute, said:
'High pressure selling alongside cold calling makes this a
very successful scam, often leaving the consumer with very little
chance of obtaining redress. Partners are working together to help
educate and protect consumers in respect of these rogues.'
NOTES
1. The Consumer Protection from Unfair Regulations 2008 prohibits
unfair commercial practices and, in particular those which
constitute misleading actions, misleading omissions and aggressive
commercial practices. The Regulations are enforceable through the
civil and criminal courts. Breach of the law is an offence
punishable by up to two years imprisonment and/or an unlimited fine.
2. Car-matching scammers have easy access to car sellers'
details through online publications and newspapers, and a number
of individuals involved in such scams are associated with more
than one company. Consumers across the country have been targeted.
The OFT has also been informed that consumers from the Republic of
Ireland have been targeted by some of the same UK traders.
3. There has been a concentration of these scam companies
operating from around North London and Hertfordshire and several
recent enforcement cases have been successfully brought against
these rogue traders by trading standards. Recent action taken
against vehicle matching companies includes a prosecution taken
under the Trade Descriptions Act 1968 by Hertfordshire County
Council Trading Standards. See press release
http://news.hertsdirect.org/Release.aspx?a=1&id=7704&_cat=11.
The OFT have also removed the consumer credit licence from a
London vehicle matching company in November 2008 (http://www.oft.gov.uk/news/press/2008/127-08).
In addition, Companies Investigation Branch has taken action
leading to several scam vehicle matching companies being
compulsorily wound up.
4. The OFT is also warning employees of rogue car matching firms
that they will be individually liable for prosecution for
knowingly and dishonestly misleading consumers.
5. Earlier this month, the OFT launched a market study into the
sale of second-hand cars related to franchised and independent
dealers. Though not looking at private car sales, its findings
will aim to provide clarity across the wider second-hand car
market. See press release http://www.oft.gov.uk/news/press/2009/51-09
6. If you think you have been the victim of a vehicle
matching scam, or you suspect a scam, call Consumer Direct for
clear, practical consumer advice on 08454 04 05 06.
7. Consumers need to be alert especially during the current
economic climate. Consumer Direct advises:
* Stop, think and be sceptical if you are cold called and are
asked for money in advance.
* Don't give your credit or
debit card details to people you don't know.
* Stop,
think and be sceptical if promises are made which gives the
impression that there are immediate buyers for your car, that
finance has already been arranged for potential buyers, that
buyers are willing to pay your asking price or more, there are
buyers ready to view your car immediately or that you will be
offered a refund if the car does not sell.
* If it sounds too
good to be true it probably is. Don't be pressured into
anything If in doubt about a particular telephone call, hang up.
For more information on vehicle matching scams go to http://www.consumerdirect.gov.uk/vehiclematching
http://www.oft.gov.uk
PUBLIC enquiries: 0845 7224499 enquiries@oft.gov.uk
OFT
reports and consumer information leaflets are available free
from:
OFT, PO Box 366, Hayes UB3 1XB 0800 389 3158 oft@ecgroup.uk.com