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Intellicheck Blog


Tag : automotive fraud

  • In the automotive industry, single instances of fraud can amount to tens of thousands of dollars in losses even if the car is recovered. That said, the best way to minimize fraud losses is to prevent fraud from occurring in the first place.

    To do this, businesses and dealerships must take preventative measures to combat both in-person and online fraud. Here is a checklist to help you catch fraud before it’s too late and save money:

  • With the demand for automotive sales moving from in-person to online, the need for fraud prevention methods is also increasing. In fact, according to a recent study by GIACT, 85% of car shoppers are more likely to buy from particular dealerships that will allow them to start or complete nearly all of their vehicle purchases online.

    Due to this massive shift to online purchasing, a wide range of opportunities have opened up for fraudsters to steal from automotive dealers.  Fraud in the automotive industry can be as easy as a few credit card scams.

  • Fraud in the automotive industry can cost dealerships hundreds of thousands of dollars. Unfortunately for these dealerships, automotive lenders are now trying to make the dealerships shoulder the responsibility for fraud related losses, which leaves dealerships to absorb the detrimental costs. 

    In many automotive fraud cases, fraudsters will submit fraudulent documents that help them receive a higher credit limit at a lower interest rate. They may also plan to steal a vehicle without any intent to make payments at all. In these instances, fraudsters may pose as a strong applicant with a solid credit history with their sole goal being to drive the vehicle off the lot. Once the vehicle has left the dealership then the likelihood of recovering the losses is far lower. 

    Some of the most commonly forged documents dealerships need to watch out for include fake IDs, true name fraud, misrepresented income, and stacked loans. Getting to know these forms of fraud can help prevent them and save the dealership money.

  • Many fraudsters have an easier time bypassing online fraud prevention measures than in-person. The demand for purchasing things online has increased more and more each year, especially for automotive retail. 

    In fact, according to the Cox Automotive Future of Digital Retail study, 85% of shoppers are more likely to buy from a particular dealership that allows for them to start or complete nearly all of the vehicle purchase online. 

    As dealerships adjust to the demand in the market, they need to be aware of the two major forms of fraud: true name fraud and synthetic identity fraud.

    These forms of fraud are becoming increasingly more common, making it no longer effective to simply check a credit score to verify identities. So while trying to keep up with demands it is important to stay educated on the risks.