Vehicle Account Rescue Scams

Vehicle account rescue scams target vehicle owners who are experiencing financial difficulties and who are trapped by vehicle instalment or lease agreements. The perpetrator will pose as a ‘broker’ or bogus company and advertise deals in newspaper classifieds or trade magazines with the promise to ‘take over’ lease or vehicle instalments from vehicle owners. Some advertisements even promise vehicle owners a cash settlement that they can use towards a deposit on another vehicle.

The vehicle owner then makes contact with the ‘broker’ or bogus company and enters into a deal to transfer the vehicle. The transaction proceeds as promised, documents are signed and the vehicle is handed over to the ‘broker’ or bogus company. However, the vehicle lease or finance agreement with the bank is not transferred nor settled, which leaves the vehicle owner liable to the bank for the outstanding debt.

The majority of offers to remove the difficulties vehicle owners experience with vehicle finance or lease repayments made by third parties are fraudulent. Vehicle account rescue scams cause unsuspecting vehicle owners to lose their vehicles but they still remain liable for the debt.

Remember, if the vehicle is still under finance, it is illegal to enter into any third party transaction without the knowledge of your bank. To avoid becoming a victim of vehicle account rescue scams, Consumers experiencing financial difficulties are advised to approach their banks directly for assistance rather than responding to these advertisements.

Tips to Avoid Becoming a Victim of a Vehicle Account Rescue Scam:

  • Always contact your bank for advice if you want to sell a vehicle that is still under finance to any third party.
  • Never hand over your vehicle to a third party until your vehicle finance debt has been fully settled.
  • Contact your bank immediately if you experience difficulties paying your vehicle instalments or lease payments. All banks offer advice and alternative remedies to clients that experience difficulty honouring their payments.
  • First consider selling your vehicle if you are unable to honour your debt or get debt counselling to restructure your payment plan.
  • Always get your financial institution involved when you intend to purchase a vehicle in a ‘private sale’ deal.
  • Avoid ‘private sales’ if possible and rather purchase a vehicle from a reputable dealership.
  • Regard any promise of a ‘quick way out’ of a long term contract suspiciously because these solutions may put you in an even worst position.
  • Remember you are contractually obligated, where a vehicle is still under finance, to provide the name and address of the person to whom you transfer possession of the vehicle

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© The Banking Association South Africa 2019