Car Buying Scams Online: Fake Listings and Escrow Fraud

Online car buying scams lure victims with attractively priced vehicles that either do not exist or are misrepresented. The BBB Auto Line and FTC report thousands of cases annually, with average losses of $2,000 to $5,000 and some victims losing the full purchase price of a vehicle. As more car shopping moves online, these scams have become more sophisticated and harder to detect.

Common Car Buying Scam Types

Non-existent vehicles. Scammers post listings using stolen photos from legitimate dealers or auto photography sites. The vehicle is described with desirable features at a below-market price. The seller claims to be relocating, deployed military, recently divorced, or otherwise motivated to sell quickly. They request a deposit via wire transfer, Zelle, or gift cards to “hold” the car.

Fake escrow services. The scammer suggests using an escrow service for buyer protection, then directs you to a fraudulent escrow website they control. You wire money to the “escrow account,” which is actually the scammer’s bank account. The escrow site may even send confirmation emails and tracking information before disappearing.

Title washing. A vehicle with a salvage or flood title is transferred through states with less stringent title requirements to obtain a clean title. The buyer unknowingly purchases a vehicle with hidden damage history. This is technically fraud even though a physical car changes hands.

Curbstoning. Unlicensed dealers pose as private sellers to avoid disclosure requirements and consumer protection laws. They buy cheap vehicles at auction (often with undisclosed mechanical issues or accident history), clean them up cosmetically, and sell them at a markup without disclosing known problems.

VIN cloning. Scammers copy the Vehicle Identification Number from a legitimate vehicle onto a stolen one. The cloned VIN passes standard background checks, making the stolen vehicle appear clean. The buyer may not discover the fraud until police identify the vehicle as stolen.

Protection Measures

Never pay before seeing the vehicle in person. No legitimate reason exists to send a deposit before physically inspecting the car. If the seller insists on remote payment, it is a scam.

Run a VIN check. Use NMVTIS (vehiclehistory.bja.ojp.gov), Carfax, or AutoCheck to verify the vehicle’s history, title status, and whether it has been reported stolen.

Inspect the VIN physically. Compare the VIN on the dashboard, door jamb, and title document. Mismatched VINs indicate VIN cloning.

Use legitimate escrow only. If using escrow, select the service yourself rather than accepting the seller’s suggestion. Escrow.com is a legitimate service; random websites suggested by sellers are not.

Get a pre-purchase inspection. Have the vehicle inspected by an independent mechanic before purchasing. This reveals hidden mechanical issues and accident damage.

For more on fake website identification, see our shopping scam identification guide. To understand wire transfer risks, explore our wire transfer scam prevention guide.

Financing Scams

Beyond the vehicle itself, financing scams target car buyers through fake loan offers, yo-yo financing (where the dealer calls after you drive away claiming the financing fell through and demanding worse terms), and title lending scams. Always arrange financing independently through your bank or credit union before visiting dealers. Compare the dealer’s financing offer against your pre-arranged terms.

Private Sale Safety

When buying from a private seller, meet in a public location. Many police stations offer designated “safe exchange zones” for online transactions. Never bring large amounts of cash to an unfamiliar location. Use a cashier’s check from your bank, and complete the transaction at the bank where you can verify funds. Never sign over a title until you have confirmed the seller is the titled owner and there are no liens on the vehicle.