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How Can I Avoid Online Car Auction Scams?

By Mike Richards Updated: 05/22/2019 Posted: 10/23/2015

If you’ve been thinking about buying a car at an online auction, you may be concerned about the possibility of scams. The fact is, they’re rare. Most online auction sites are highly reliable, and work to exacting standards. That said, though, there are things to watch out for.

Lisa’s Story

Lisa (not her real name) won a 2013 Ford F150 4×4 at an online auction. She was beyond delighted – it was a fabulous deal, she thought. The pictures showed a truck that looked brand new, and she got it for just a little over $10,000. A few weeks later, though, she was out $10,000 and she had no truck. She was a victim of an online auction scam.

How Do the Scams Work?

Most online auction sites are perfectly reputable. But there are scams out there that target online car buyers. Some even “clone” reputable auction sites – everything looks legitimate, but it’s not.

In Lisa’s case, she bid at an auction on eBay. She got an email telling her that she’d bid highest, and she’d won the truck. If she had checked, though, she would have seen that eBay never notified her, as they do in all cases when you’re the highest bidder. The scammers simply harvested her email address, and then notified her about a vehicle that might not even have existed.

What made it even worse was that Lisa had taken out a loan to buy the truck, and then she sent the money to what was supposed to be a secure escrow site. Escrows are often used when buying vehicles, since the idea is that the escrow agency holds the money until the vehicle is shipped.

In this case, the escrow site was actually a bank account that was controlled by the scammers, so once she sent the money, the scammers simply withdrew the money and closed the account, eliminating the paper trail. Later, when Lisa tried to get the money back, she discovered that the website was fraudulent, and she had no recourse.

Lisa Isn’t Alone

With the increase of online shopping, online crime also increases. So how do you protect yourself? One way of doing so is to go online to investigate online scams. One resource is, a website that posts details about all kinds of online scams, and offers information about how to avoid becoming an online scam victim.


Many online scams are operated from Nigeria or other overseas locations, and the first thing you’ll notice is that the English is fractured.

Another tip-off is that the seller demands you send the money to an escrow account. See above. The seller is not the one who needs escrow protection. You are.

If you suspect that anything is off, don’t complete the vehicle purchase, Keep in mind that scammers target literally millions of people, and if you question them at all, they’re likely just going to go away. If you’re considering a transaction, and the seller disappears, chances are that you’ve just avoided a scam.

Six Ways to Avoid Getting Taken in an Online Vehicle Scam

Does the deal look too good? If it seems too good to be true, it probably is.

#1. Make Phone Contact

Call the seller. Find out where the car is. Ask if you can inspect it, and if the title is in their possession. If you get any kind of hesitation, walk away.

#2. Verify the Escrow Company

Make sure they’re properly licensed, and speak to a representative. Don’t use the link that the seller provided.

#3. Never Give Personal Information

Until you know that the escrow company is “real,” don’t give out any personal information like your social security number or your banking information.

#4. Check the Escrow Company’s Website for Red Flags

This is where you look for things like sloppy grammar again.

#5. Don’t Pay Online into an Escrow Company

A legitimate escrow company will never ask you to send a person-to-person money transfer, or ask you to send a payment to an individual as opposed to a corporation.

#6. Be aware of companies with web domains ending in biz., org., US., or info.

They are often used by scammers based outside of the US.

The Final Word

If you’re bidding on a vehicle online, use only verified, reputable sites. Never give out your personal information. And to be really safe, deal with a proxy bidder that’s known and reliable. Sometime you can get a great deal on an online vehicle purchase, but you have to be careful.

Explore our Vehicle Auctions, as well as finding more information about How These Auctions Work and Buying With Us.