Lenders who finance auto loans in B.C. and car dealerships have been increasingly targeted by criminals seeking – and obtaining - fraudulent car loans in 2020.
Often, it’s due to an inability to deal face-to-face with customers due to no-contact COVID-19 protocols. Combine that with identity theft and the result has been a wave of crimes involving mostly high-value vehicles.
Metro Vancouver Crime Stoppers is urging anyone with information to contact them anonymously with information on who’s involved. Auto fraud losses drive up consumer loan costs at lending institutions and can impact an identify theft victim’s credit bureau rating.
How it happens
Someone contacts a bank branch for a car loan. The vehicle is often worth $80,000 or more. The loan is done online or over the phone because social distancing policies often preclude an in-person appointment.
The applicant is a criminal using stolen identification, and the loan can get approved by the lending institution without ever meeting the applicant.
Loan payments soon default, or the identify theft victim starts getting loan demand notices. By the time the bank and dealership involved realize what’s happened, the car’s been sold to another victim who finds out it was fraudulently purchased – or it’s been exported overseas for cash. The car’s gone forever.
These frauds often involve organized criminal groups fabricating drivers’ licenses with victim data, with an image of one of the perpetrators on the driver’s license
Trends in Auto Loan Frauds
Since December 2019, Scotiabank alone reports two dozen such cases in B.C., most of them since the mid-March outbreak of COVID-19.
Losses to consumers and this bank alone have reached $1.5 million to date.
Banks in the Lower Mainland, Terrace, Kelowna and elsewhere in B.C. have been hit this year.
The victims, dealerships and banks must then collaborate with police to identify the source of the problem - and determine who will be liable for the loss.
Reporting it anonymously to Crime Stoppers
Anyone with information that can help police find and arrest these fraudsters is urged to contact Crime Stoppers anonymously, says Linda Annis, Executive Director of Metro Vancouver Crime Stoppers.
“Maybe you know where the fraudster lives, or you’re connected somehow to the crime but want it all to end. All we want from you is your information. We don’t want to know who you are. You’ll never be called back by police, you’ll never have to go to court and you could be eligible for a cash reward,” said Annis.
Avoid being an auto fraud victim
Sources of data breaches include theft, discarded or misplaced personal documents, database breaches, insider information and phishing.
Consumers need to protect passwords, sensitive personal information including bank statements, SIN number and payment information
Periodic checks of credit bureau information and credit card balances can identify potential breaches of personal credit information.
If you do become a victim, remember to hang on to any documents, receipts, copies of emails and text messages that may help the investigation.
“Consumers, stakeholders and lenders all have a role to play in order to protect the borrowing capacity of consumers,” adds Jeffrey Beede, Senior Manager of Investigation Services at Scotiabank. “Our bank and others are constantly working with retail partners and making our internal systems more rigorous to address risk areas related to verification of identification in retail loan applications. If consumers or stakeholders are aware of risks to their credit or account breaches, they should report concerns immediately to local police, the Canadian Anti-Fraud Centre or Crime Stoppers to facilitate mitigation.”
