Tim Smith (not his real name) never imagined strangers would appear at his Kentucky service center demanding vehicles he never sold them.
The self-described “old country boy” was shocked when angry customers began showing up to his business claiming that they had sent him thousands of dollars for trucks that they never received.
Hundreds of people were duped when fraudsters in Romania created a fake dealer website that impersonated his business and then posted fake listings of cars for sale.
He and many other small dealerships are finding themselves caught up in a multi-million scam that is sweeping the auto industry – car dealership cloning.
How Fake Car Dealerships Are Stealing Millions
Law enforcement agencies across the nation are issuing urgent warnings about the new sophisticated fraud scheme that lures car buyers in.
The Wisconsin Department of Transportation recently issued an alert about what officials call a “troubling” trend of vehicle sellers creating fake storefronts online.
The scam starts when criminals create a website or social media profile claiming to be a legitimate dealership. After they create the website, the steal legitimate listings off other dealerships, or create new ones using stock photos.
Here is an example of fake listing created by Romanians on the cloned website.
According to a recent article in CarScoops, the dealer cloned sites are just the bait that is used to get them to send irreversible wire transfers for cars they will never receive.
They spoke with DMV Dealer and Agent Section Chief Maura Schifalacqua and she broke it down.
“In one case, the business never existed,” Schifalacqua said. “In many cases, the fraudster interacts with the consumer by phone or email. The buyer might receive a bill of sale and several photos of a vehicle and agree to purchase by wire transfer, believing the seller will ship the car to them. After the wire transfer is completed, the seller stops all contact, and the customer eventually realizes they’ve become a victim of fraud.”
How A YouTuber Exposed The Romanian Fraud Network Targeting Dealerships
Internet scam hunter Kitboga has built a following of millions by exposing fraudsters, but even he was surprised by the sophistication of this vehicle scam.
“It’s not obvious like those emails a prince sent saying he’s going to give you a million dollars,” Kitboga explained in his investigation. “It’s a truck for sale listed on Carfax.com, Edmunds, Facebook Marketplace—but the person selling doesn’t actually have the vehicle.”
Going Undercover To Catch The Scammers
To document how the scheme worked, Kitboga found a listing online and posed as a potential buyer interested in a Ford F150 Truck that was selling $10,000 below the market value.
The listing claimed that it was underpriced because they “were not trying to keep the inventory for two to three months”
When Kitboga expressed interest, the fraudster immediately created urgency, claiming another buyer was “seriously thinking about it.” The scammer refused an in-person inspection, insisting on delivery and demanding payment through bank transfer—both huge red flags.
“Go To The Bank And Hand The Phone To The Banker”
“I cannot receive you until next week, so the fastest way for us to do business is if you choose the delivery option”, the scammer tells Kitboga. He says other buyers will beat him to the punch if he doesn’t purchase it right away.
The scammer insists that Kitboga go to the bank in 30 minutes and that when he gets to the bank to hand the phone over to the teller.
Kitboga pretends to go to bank and this hilarious exchange with the scammer takes place doing a “mouth to mouth” transfer. 🤣🤣🤣
Dismantling The Scam Operation – Taking Down The Dealer Clones
After documenting the scam, Kitboga took action to dismantle the operation targeting Smith’s business. He first secured the scammer’s bank account information, to shut down the financial operations.
Kitboga than called the fraud departments of CarFax and Edmunds to take down the fake dealer websites that were created.
“I’m going to escalate this to my manager,” one representative told Kitboga. “We will definitely be putting in an immediate cancellation for this dealership and everything will be taken down today or tomorrow.”
It ended up taking 6 days for them to remove the sites.
Angry Customer And Terrible Reviews
For Tim Smith, the scam was devistating and wrecked his business.
“It’s not good when you pull up to your car lot and there’s people sitting here waiting on you that’s very angry,” said Smith. One victim had sent $45,500 to the scammers, while another woman sent $37,000 for a vehicle she never received.
And the positive 5 star online reviews on Google were shattered and people are now staying away.
“It’s showing up on our reviews, all these people that put ‘scam’ on there,” Smith lamented to Kitboga, the frustration evident in his voice as years of honest work were undermined by fraudsters using his identity.
Not Isolated Incidents, This Is A National Trend
These are not isolated incidents. State attorney generals and federal authorities are tracking similar dealer cloning scams across multiple states including Wisconsin, Tennessee and Minnesota, Connecticut and Oregon among those that have recently issued urgent warnings.
Red Flags – How To Spot A Fake Dealer Scam
Spotting a dealer cloning scam isn’t hard if you know what to look for. Here are some recomendations:
Never Buy Sight Unseen
Always physically inspect any vehicle before transferring payment. Tennessee’s Attorney General specifically advises consumers to view vehicles or heavy machinery in person before purchasing.
If you cannot inspect it personally, hire a trusted third party like a local mechanic to examine it for you. The small cost of inspection is insignificant compared to potentially losing your entire payment to fraud.
Research Thoroughly Before Engaging
Conduct background research on any dealership before making contact. Check customer reviews on Google, Yelp, and other platforms, and look for dealerships with BBB Accreditation or an A+ rating.
Verify Vehicle Details Independently
Always request the Vehicle Identification Number (VIN) and run it through independent verification services like CARFAX. Cross-check ownership information and vehicle history rather than relying solely on information provided by the seller. Be especially wary if a seller cannot or will not provide complete vehicle documentation or history reports.
Compare Prices Across Multiple Sources
Research average prices for similar vehicles on multiple platforms to establish a reasonable price range. Dramatic discounts without clear justification should raise immediate concerns.
The Wisconsin DMV specifically warns about vehicles “listed at below market value” as a tactic to “cause interested consumers to take the bait.”
Use Secure Payment Methods
Never wire money or use gift cards, cryptocurrency, or direct bank transfers to purchase a vehicle. These payment methods typically offer little or no recourse if fraud occurs. Instead, use traceable payment methods like checks or credit cards, which provide better fraud protection.
Also, consider using escrow services specifically designed for vehicle purchases that release payment only after you’ve received and verified the vehicle.
And Finally, Trust Your Gut!
Be wary of sellers who avoid direct questions, have inconsistent stories, or pressure you for quick decisions. Professional communicators who suddenly display poor grammar or unusual expressions may be overseas scammers.
If something feels wrong during your interactions, trust that instinct and proceed with extreme caution or walk away altogether.
Thanks for reading!
