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Watching out for Fraud

tidestertidester Posts: 10,110
Have you or anyone you know been the victim of fraud in relation to buying, leasing or maintaining a vehicle? Let's discuss it here.

tidester, host
SUVs and Smart Shopper
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Comments

  • Karen@EdmundsKaren@Edmunds Posts: 5,023

    Karen-Edmunds Community Manager

  • howardp2howardp2 Posts: 1
    Cash for Clunkers (CFC) failed me yesterday.

    Last week I got email quotes for a Honda CR-V from 3 dealers. All about 21,300 out the door (Base model LX, automatic). Didn't mention CFC. Last Friday went to a different dealer in person and agreed on a final OTD cost of 21,600 (had added options). I even told them about the $4,500 I'd need for CFC. They said they had to finalize the program over the weekend.

    But, they agreed to sell the car for a final price of $17,188. Before going to pick it up yesterday, they called and the owner wants another $1,100 if I want to use CFC. Otherwise, they'll do the same price without CFC. Owner says they don't want to "loan" the Gov/t the $4,500 for an unknown number of days till they get the money back.

    Okay, I can see that. I offered to pay them 6% of the $4,500 for 90 days ($68) plus an extra $100 just so I wouldn't have to start over. They still want $1,100 more. I told them no.

    Funny, another dealer told me last week they would only sell a car at MSRP if someone wanted to use CFC. Same thing about floating a free loan to the Gov't. So, I gotta start all over.
  • jeffyscottjeffyscott Posts: 3,855
    25% interest for what is supposed to be a 10 day delay in getting the money from the government seems just a bit ridiculous.

    This sort of thing and the post about the person waiting to get their $4500 check from the dealer (which is not the way this is supposed to be done, according to the rules) are some examples of how this deal might not turn out to be what it appears to be for some. For the person waiting for a check, I wonder what happens if the dealer does not get the $4500 and has already destroyed the clunker (which I think they may need to do before they can get the money)?

    I was figuring there would be a mad rush of people doing deals with absolute junk vehicles so they'd not care if the new car was $500 or $1000 higher than it otherwise would be. With the rush of buyers, the dealers may not need to offer as big of discounts as otherwise to sell cars.

    So in my case, with a $2000-2500 vehicle and only $3500 in C4C money available on the only cars my kid might want to use it for currently, we decided not to worry about jumping in to this.
  • kdhspyderkdhspyder Posts: 7,160
    Those dealers have the option of doing that if they so choose. My guess is that they will lose sales by taking this position but they might come out ahead profit-wise / cost-wise in the short term. But it's their business to run.
  • SylviaSylvia Posts: 1,636
    Payments to dealers are ALREADY being made through the system so in my personal opinion the dealers are really being dorks on this.
  • I did my deal over the weekend, no issues. But have a question to pose to the world. The law states that the dealer is to estimate the scrap value of the trade in and pass it along to the purchaser less $50. In my case, the estimated scrap value of my trade (1998 Ford Ranger, 233K miles) was listed at $50. What experience has everyone else had with this? Is this typical?
  • Are they? I keep looking for evidence that things are moving ahead, haven't seen anything much in the news. On my deal, we did it Saturday, on Monday it took the dealership five hours for one submission, and they lost the system in the afternoon. Finally got my stuff submitted yesterday afternoon.

    No real surprise (I think it's pretty impressive the gov't put the whole system in place in basically 30 days), but I haven't seen anything when the payments will process once submitted, assuming clean paperwork.
  • oldfarmer50oldfarmer50 Posts: 6,023
    "...by Sylvia STAFF..."

    I've never seen that title before. Is that the Edmunds equivalent of "Boss" as in "Boss of the Hosts"? If I get mad at a Host can I get them in trouble if I complain to you?

    Please let me know, some of them have been mean to me and I'd like to tattle. :P

    2009 PT Cruiser, 2008 Eclipse, 1995 Mark VIII, 1988 GMC Van

  • nortsr1nortsr1 Posts: 1,060
    What dealers. Please name some????
  • SylviaSylvia Posts: 1,636
    You can always complain but I may be like Lucy on the Peanuts cartoon :P
  • volvomaxvolvomax Posts: 5,274
    Considering that the most valuable part of the car(the driveline) can't be re-used the scrap value probably isn't more than $100 or so. Could very well be $50. Esp if there is an influx of metal. Remember, anything that floods the market lowers the price.
  • fezofezo Posts: 9,195
    Payments to dealers are ALREADY being made through the system so in my personal opinion the dealers are really being dorks on this.

    I love it when you talk technical.... :P Dorks. I've used that term a lot when dealing with car dealers...
  • tidestertidester Posts: 10,110
    the most valuable part of the car(the driveline) can't be re-used

    I'm not sure I understand your point. The driveline is precisely the scrap that CARS is intended to create - i.e. it IS the bulk of the scrap value defined in the law. That would ordinarily work out to $300 to $400 for typical sized car even with modestly depressed scrap values. What's leftover can be sold as parts and the dealer stands to profit from that.

    tidester, host
    SUVs and Smart Shopper
  • jwilliams2jwilliams2 Posts: 854
    Tidester, I don't understand your point. The dealer only gets what the salvage yard pays him for the disabled car. Most dealers want no part of dismantling junkers and selling used parts. They just want it off their lot as soon as possible. The salvage yard will certainly profit, but I'm not sure how the dealer stands to profit.
  • tidestertidester Posts: 10,110
    The law specifically states that the dealer must inform the customer of the scrap value of the clunker and it specifically states that the dealer may retain $50 for administrative costs. Naturally, that leads to the question of who gets the proceeds from the scrap. I am not lawyer but that wording suggest to me that the scrap funds should go to the customer.

    If the (all) money was intended to be retained by the dealer then why specifically require the dealer to inform the customer? Perhaps someone can enlighten me.

    tidester, host
    SUVs and Smart Shopper
  • jwilliams2jwilliams2 Posts: 854
    Again, scrap value to the dealer is the amount the salvage yard is willing to pay him and haul it off. If it is $100, he should pass on the extra $50 to the customer. If it is only $50, then the customer gets nothing. If the salvage yard wants to charge the dealer $50 to come get it, then I guess the dealer has to eat that amount. I think that is the extent of the dealers responsibility.

    I can't imagine the government wants the customer auditing the salvage yards to find out what parts they salvaged and how much they sold them for a year down the road.
  • volvomaxvolvomax Posts: 5,274
    The most VALUABLE part of any scrap car is the engine/transmission. In most cases these are still in working condition if the car is scrapped. Most common reason for scrapping is an accident. The rest of the car has very little value. Most interior trim pieces cannot be removed safely and the exterior panels are usually too beat up to be of any real value. Aftermarket parts are quite cheap for most cars as well as being brand new or remanufactured. So, you are down to recycling the metal. Given the influx of metal, prices will go down, A scrap yard just MIGHT make a couple or three hundred on such a car, but it isn't a great profit margin.
  • nortsr1nortsr1 Posts: 1,060
    A lot of them take off the wheels, pop the windshields. possibly fenders, hoods. I know this is stretching the point, but most of the scrap yards I went to worked this way!!
    When I was younger, many a day I spent at the junk yard looking for a certain whatever. A lot of the bigger scrap yards now, actually have a computer based inventory.
  • On August 2010 we purchased a 2007 Mercedes GL450 from Ibrahim Galabi and Bill Renau at Springfield Acura, in Springfield NJ. We were told that the vehicle had a navigation system, and we needed to wait for the DVD, which they had ordered, for the system to work. We were also informed that the vehicle had satellite radio and we would need to subscribe in order to activate it and was Bluetooth capable, and we needed to pair our phone with the vehicle in order to set it up. Upon returning home we attempted to activate our satellite radio, only to be informed by the provider that the car was satellite ready but did not have a receiver and that would cost $200 plus installation. We also tried to pair our phone with the vehicle, when we were unable, we called Mercedes and were informed that this vehicle did not have Bluetooth capabilities. When we went to the dealership on August …2010 to have the navigation set up in the vehicle, we were informed that it did not in fact have a navigation system. We researched getting one installed through Mercedes Benz and the cost would be $6000. Bill Renau, the general manager, informed us that he would correct this matter immediately, and for the time being we should use the vehicle that we had purchased until he could find a suitable replacement meeting the specifications of the vehicle we believed we had purchased. On Septmeber 1, 2010 we spoke to Ibrahim Galabi, our sales representative who sold us the vehicle, and he informed us that he was not able to get a comparable vehicle but was able to secure a 2008 but it would be an additional $5000 out of pocket for us. They also offered us $600-700 if we would be willing to keep the original vehicle. This setup was a scam, a play off of the traditional bait and switch. We were sold a vehicle which we believed met all of our required specifications, only to be informed after we had paid for it, that it did not have the amenities we were looking for and that in order to get those we needed to pay an extra $5000.
  • jipsterjipster Posts: 5,345
    edited September 2010
    The General Manager didn't keep his word. I'd call corporate Mercedes and complain. You should either get the items that were promised, or the money that they cost, If corporate doesn't put some pressure on Mercedes to accomodate you, you can always take the dealership to small claims court. Or, you can counter offer. Tell them you want $2,500... or whatever you think reasonable.
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