By Jim Stickford, UCN

August 18, 2004

An old con that can cost used-car dealers thousands of dollars has reappeared in upstate New York. Here’s how the scam works: A con man contacts a person selling a car, claiming to have seen an ad in the local paper or on a Web site. He tells the seller he wants to buy the car and sends a check to pay for it.

When the check arrives, it’s for a greater amount than agreed upon, so the seller contacts the “buyer.” The con man then asks the seller to write his own check to make up the difference, which will be picked up when someone comes by to get the car.

When the courier doesn’t show up, the “buyer” claims something has come up and asks to have the money wired to him. The Syracuse, N.Y., police department recently received several reports from victims of this crime. There are variations to the scam. Sometimes the dealer is told the extra money is to pay for the price of shipping the car overseas and asks that the extra money be sent to a shipping firm.

Sgt. Tom Connellan, spokesman for the Syracuse police department, said one warning sign of the con is when the buyer’s original check comes from a foreign bank. A bulletin from the New York State Banking Department said counterfeit money orders have been issued across the country and are being used in this type of fraud.

Thanks to the sophistication of computer technology, it’s now very easy to print authentic-looking checks and money orders. This particular scam crops up from time to time. In 2003, several car dealerships across the country were hit by con men running this scam.

Michelle Primm, managing partner of Cascade Auto in Cuyahoga Falls, Ohio, was targeted by con men last year. In addition to selling new Porsches, Audis, Mazdas and Subarus, Cascades specialize in high-end used vehicles. “My brother Pat began an Internet conversation with someone on June 10, 2003,” Primm said. “It came from the e-mail address vebhevcars@indiatimes.com. The message said they specialized in the purchase and shipping of used cars to numerous customers worldwide.”

The e-mail offered to pay $7,500 for a car listed at $7,900, Primm said. Her brother e-mailed back a reply, agreeing to the price. A few more e-mails were exchanged. “Then suddenly we received a Federal Express package,” Primm said. “It contained a check for $10,500. An e-mail was sent to us on June 24, stating the check was for a Mazda 626. We were told to send the extra $3,000 to a specific shipping company to prepare the car for shipment. By that time the 626 had already been sold.”

Several things bothered Primm and her brother. One was that the check was for more than agreed upon price. Second, the check was made out to her brother personally and not to Cascade Auto. Finally, when they informed the buyer that the 626 had been sold, where should they refund the money to, they were told to contact the shippers and were given an international number to call.

“It just didn’t seem right,” Primm said. “We ran a trace on the Federal Express package and it came from Great Britain, in a place called Poyle. I showed the check to our office manager and she said it was homemade. She could tell because she could actually feel the letters, which is an indication that a check is homemade.”

Primm said the dealership’s conservative money policies saved them. Any time someone wants to do something unusual, or money is coming from out-of-county or out-of-state bank, they pay extra attention. “I like to say it takes three days for a check to clear and 14 days for a check to bounce,” Primm said. “The law says when you deposit a check you have to be able to get the money within three days. But sometimes it take up to 14 days for a bank to clear the check through all the other banks and financial institutions involved.”

Sullivan Brothers Chrysler-Dodge in Kingston, Mass. was also the target of an Internet fraud last year. “We didn’t get hit,” said general manager Mike Hoch. “We saw through the con. The first thing that tipped me off was the contract. They wanted to buy a $9,000 used car with a $16,000 check and have us cut them a check for the extra $7,000.”

Hoch said the whole thing sounded like some sort of money-laundering scheme. He also noticed the English used in the e-mail messages was poor. “I kept contacting the buyer just to see what would happen,” Hoch said. “The buyer wanted a used car and said as soon as I received the check, I should cut a $7,000 refund check. “He ended up sending me to different addresses to send the check in different e-mails.”

One of the addresses was in Canada, Hoch said. His instructions were to wire the money through Western Union. Once he collected all the information he could, Hoch forwarded it to the Secret Service and the FBI. “I was told it’s hard to stop these rings,” Hoch said. “They’re all based in other countries.”

Hoch said selling used cars over the Internet is common practice for many dealerships. “The Internet is a vital tool of business these days,” Primm said. “So if you’re going to do business using the Internet, be careful. That’s why we don’t give any refunds for 14 days. It gives a check time to clear.”