Online auto scams snaring buyers

  • Article by: JENNIFER BJORHUS , Star Tribune
  • Updated: September 13, 2013 - 8:30 PM

The Better Business Bureau is warning about a string of bogus car dealership websites.

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1999 Chevrolet Corvette convertible. 99-08COR

 

The website looks valid at first glance, with shipping information, customer testimonials and shots of such dream cars as an 1963 Austin-Healey and a 1962 Corvette.

The first red flag is the low prices.

The online dealership is fake. There is no Carsten Autos at 333 Washington Av. N. in Minneapolis, and the local Better Business Bureau is trying to get the website taken down before another car buff wires the scammers money.

It’s the latest in a string of phony online car dealerships that have popped up on the Internet since late 2011 claiming to be in either North Dakota or Minnesota.

The scam: wire us money, we’ll ship you the car. The latest, Carsten Autos, was discovered Friday.

The BBB said it has been successful in shutting down the bogus websites but still doesn’t know who is behind them. It’s aware of only a handful of victims of the cyberscams, all outside Minnesota, but suspect there are more.

One victim the bureau spoke with is a man outside Chicago who lost $35,000 after wiring money for a Corvette he’s wanted all his life, said BBB spokesman Dan Hendrickson.

Given how easy it is to create websites without revealing your ­identity, and the relatively large amounts of money involved, the BBB said it expects such scams to flourish. The FBI’s Internet Crime Complaint Center warned about general online auto scams in 2011 estimating that between 2008 and 2010 victims who reported the problem lost nearly $44.5 million in the swindles.

FBI spokeswoman Jenny Shearer said she hadn’t heard about the ­version of the scam using fake dealership websites.

“I would caution someone about making such a significant purchase online,” Shearer said.

The scheme first came to light in late 2011 with a fake company claiming to be operating a dealership in southern Minnesota. Then it spread to North Dakota, with nonexistent dealerships supposedly based in Fargo, Bismarck and Grand Forks.

Earlier this year, there were two more in Minnesota, in Minneapolis and one in Rochester. Carsten Autos is the fourth purporting to be in ­Minnesota.

The addresses lead to empty warehouses and office buildings, but long-distance shoppers don’t know that.

Interestingly, Hendrickson said, there used to be a real Carsten Auto in Bingham Lake, Minn., near the Iowa border. But he said the BBB thinks it’s been defunct for several years.

Steve Farr, who’s been investigating the schemes for the bureau, said he’s been impressed by how little information the scammers need to give the vendors who create and host websites for them. Farr said one provider told him that all it really takes is a name, contact and credit card and “they’ll get their website.” No one appears to verify information, Farr said.

Farr said that in the cases where providers gave him the contact information for the scammers, their IDs, too, were bogus.

Farr said that when he talked to the North Dakota Department of Transportation about the problem he was told the agency’s hands were tied because the scammers were in cyberspace.

“When you put up a website, you sort of exist in this regulatory no man’s land,” Farr said. “It’s kind of the perfect place to be.”

In the latest case, the company that registered the domain name is in China.

Farr said that in one case, a man in Ohio looking for a classic car from one of the online dealers with a fake address in Rochester, Minn., had the “dumb luck” to have relatives in Rochester that he planned to visit.

The man told someone from the company that he’d like to swing by the dealership and take a look at the car, and the representative said he was welcome to come by. When the man showed up and knocked on doors, no one knew what he was talking about, Farr said.

 

Jennifer Bjorhus • 612-673-4683

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