Tag: auto fraud

For auto dealerships, the roar of engines and the clink of deals used to be the only sounds associated with financial risk. But in today's world, a silent threat lurks in every showroom: identity fraud. This insidious crime is costing dealerships millions, leaving a trail of financial and reputational wreckage in its wake. The Numbers Don't Lie: Reports of the impact of identity fraud on auto dealerships are becoming more common as the industry leans more heavily on digital retailing. According to the Federal Trade Commission, nearly 80,000 cars were stolen in 2023 via fraud. Who's Behind the Wheel? The perpetrators of fraud come in all shapes and sizes. While classic ID theft with stolen documents still exists, the real menace lies in synthetic identities: Frankenstein accounts cobbled together from stolen data and fake documents. These sophisticated creations can fool even the most vigilant dealership, resulting in high-value car loans taken out on non-existent people. The Ripple Effect: The consequences of identity fraud extend far beyond lost cars. Dealerships face: Financial losses: Wrecked credit and repossessions add up quickly. Operational headaches: Investigations and legal proceedings are time-consuming and costly. Reputational damage: News of fraud breaches trust and scares away potential customers. So, What Can Dealerships Do? Arming themselves with the right tools and practices is crucial. Here are some key steps: Invest in identity verification technology: Advanced document scanning, and facial recognition can crack down on fake licenses. Experian's Fraud ProtectTM leverages cutting-edge technology to compare licenses to selfies to confirm consumers are who they say they are AND their license is valid. Train staff on fraud detection: Fraud Protect takes the challenge out of identifying fraud in a very simple way. There is no hardware or extensive training. It is as simple as sharing a URL and reading the results in your CRM. Implement stringent verification procedures: Fraud Protect allows dealers to implement fraud identification measures in a frictionless manner. As simple as one-time passcodes, selfies, and taking pictures, the consumer experience is very smooth.  For automotive dealers, the results are returned to their CRM within a few moments including all the information they need for proper decisioning. Fighting Back, One Mile at a Time: Identity fraud is a growing problem, but auto dealerships are not powerless. By raising awareness, investing in security, and embracing vigilance, dealers can protect themselves and drive this silent threat off the road. With Fraud Protect, dealers can verify documents and identity in a frictionless manner that does not interrupt the sales process. Learn more about auto fraud prevention solutions available or contact us to get started.   *This article includes content created by an AI language model and is intended to provide general information.

  Auto dealerships may sell dreams of open roads and freedom, but unfortunately, they also attract a different kind of customer: the identity thief. With high-value transactions and access to sensitive personal information, auto dealerships are prime targets for various fraudulent schemes. So, buckle up as we explore the most common types of identity fraud impacting dealerships and how to keep your wheels safe. Four common fraud schemes dealers need to be aware of 1. Third-Party Identity Fraud (Stolen Identities): Hijacking the Identity Highway This method doesn't involve creating new identities; it steals existing ones. Thieves steal personal information, often through data breaches or phishing scams, and use it to apply for auto loans under the victim's name. The dealership unwittingly approves the loan, leaving the real person saddled with the debt and a ruined credit score. 2. Synthetic Identity (Fabricated Credentials): Frankenstein Fraud on the Fast Lane Think of synthetic identity fraud as identity theft with a twist. Criminals combine real and fake information, like stolen Social Security numbers and fabricated addresses, to create entirely new personas. These fabricated identities then build clean credit histories, allowing them to qualify for high-value loans like car financing. By the time the dealership realizes the fraud, the car, and the fake persona have vanished. 3. First Party: No Way Will I Pay This method doesn't involve creating new identities; rather it is when a person knowingly misrepresents their identity or gives false information for financial or material gain. Fraudsters often have no plans to pay for their vehicle. 4. Document Fraud: Paper Trails of Deception Fraudsters can also manufacture fake or altered documents like driver's licenses, proof of income and employment verification. These forged documents create a veneer of legitimacy, allowing them to bypass dealership verification checks and secure loans based on fabricated information. Four ways dealerships can keep their brakes on fraud 1. Robust verification: Implementing multi-factor authentication, cross-referencing information with reliable sources, and verifying documents with advanced technology can significantly reduce the risk of deception. Fraud Protect™ from Experian Automotive leverages license scanning and selfie capture to verify identity. Dealers can find the true person and verify the activity through device, behavior, and step-up services. 2. Employee vigilance: Training staff to identify suspicious behavior and report potential fraud attempts can create a strong internal defense system. Fraud Protect fits within your current systems and processes. The software integrates with your CRM and does not require heavy software training or any additional hardware simplifying employee usage. 3. Secure data: Investing in data security measures like encryption and access controls can significantly deter hackers and minimize the damage from data breaches. Fraud Protect leverages Experian’s world-class data to handle the customer relationship carefully and detect errors and discrepancies. 4. Partnerships: Collaborating with credit bureaus, law enforcement agencies and fraud prevention systems can provide valuable insights and resources for fighting fraud. Experian is the world’s leading information services company. Fraud Protect from Experian Automotive offers a unique partnership for dealers through seamless CRM integration. This simple process makes multiple levels of risk identification quick and efficient for busy buyers. By acknowledging the various forms of identity fraud and implementing proactive measures, dealerships can protect themselves and their consumers from the impact of identity fraud. Fraud Protect empowers dealers with our leading fraud, identity and verification capabilities, integrated within your unique workflows. Whether on your website, leveraged before test drives, initiating out-of-state & and remote closings, or before contracting, Fraud Protect quickly uncovers potential fraud. The entire process is a quick and painless way to address risk while establishing customer trust. Take the first step in protecting profits and preventing fraud by visiting our auto fraud prevention solutions webpage.