Online adverts are making it easier for criminals to partake in vehicle insurance scams.
By Ashleigh Brown, journalist, Justmoney
Vehicle cloning is proving to be a major thorn in vehicle owner’s sides, according to the South African Insurance Crime Bureau (SAICB).
Thieves clone vehicles by copying the Vehicle Identity Number (VIN) of a legally-owned car, onto a stolen car of the same make and model. The cloned car is then sold to unsuspecting customers. The only way to find out if the car has been cloned is for the illegal status of the car to be picked up by the authorities.
Furthermore, Hugo van Zyl, CEO of SAICB warned that when you insure a cloned vehicle, insurance companies do not have to pay out, as the incorrect vehicle is reflected on the books.
Dealership scams
SAICB reported that there is an increase in high value vehicles being targeted by syndicates at dealerships.
The thief obtains information about a vehicle booked into a service department at a dealership, along with the details of the owner of the car.
SAICB reported that: “It is not known whether something is done deliberately to the targeted vehicle in the workshop to ensure that a complaint is logged or whether the suspects act on random complaints logged by owners at the different service departments.
“However, once the owner of a targeted vehicle logs a complaint, he will receive a phone call from one of the suspects pretending to be either the Customer Service Manager from the dealership’s head office or somebody from the specific service department.”
After this, the suspect will arrange to have the car picked up from the client, and then drive away with it. Only when the client enquires where the car is, do they realise they have been scammed and their car is stolen.
Van Zyl added that technology today has helped many syndicates to “up their game”. This results in many panel beating shops falling prey to criminals, as they easily find out details of the owners of vehicles and then impersonate them in order to steal the car.
Hula Hoop
Another scam which is prevalent among vehicle syndicates is the ‘hula hoop’ scam. This is where a business arranges for a third-party to take over the financing of a car.
These scams are normally aimed at clients who cannot afford their monthly repayments on their vehicle. The scams are advertised online, often with headlines querying whether customers are “blacklisted”, or “can’t get finance” reported
IOL.
Finding a ‘business’ to take a car off of someone’s hands, is not difficult, said van Zyl.
“Clients will look for somebody to get rid of their vehicle for them. It is not difficult to get someone to take your vehicle for you in South Africa,” said van Zyl.
Once the client contacts the ‘business’, they are assured that all arrangements will be made with the bank, and that the repayments will be transferred over to the new owner of the vehicle.
However, the banks are never informed of this ‘arrangement’ and many clients are left without a car and a mountain of debt to pay.
Furthermore, van Zyl said that SAICB has a “zero tolerance” policy when it comes to vehicle insurance fraud. He highlighted one case in Port Elizabeth where a man was convicted to eight years in prison for his participation in a hula hoop scam.
Hijackings
Van Zyl said that there has been a sharp increase in hijackings this year. However, he could not provide tangible statistics as they had not been released yet.
Of the R8.5 billion worth of vehicles stolen, R4.9 billion’s worth are taken across the border, R3.1 billion stay in South Africa as cloned vehicles and R514 million end up in chop shops across South Africa, reported
Fin24.
Tips
SAICB gives some
handy tips on how to avoid being caught up in a vehicle scam:
• Always buy your car from a reputable dealer.
• Be careful when buying a used car online or via the classifieds in a newspaper, which only lists a cell phone number as a contact.
• When purchasing a used vehicle make sure that the owner’s manual/service book comes with the car.
• The vehicle should always have two sets of keys.
• If a used vehicle deal sounds too good to be true, then walk away.
If you suspect a vehicle has been cloned or know of syndicates selling cloned vehicles, you can report it by calling the Insurance Fraudline at 0860 002526. Alternatively, you can also SMS your tipoff to 32269.
