When consumers’ sensitive information winds up in the hands of identity thieves, dealerships need to be prepared for the aftermath. Every dealer should know how a large-scale event, such as the recent Equifax breach, will affect their customers, and themselves.
Impact on Customers
The breach at Equifax affected as many as 143 million Americans, and, as a dealer, you should be prepared to see an increase in customer phone calls, if you haven’t already. Things you could potentially experience are consumers with fraud alerts and credit freezes popping up on their accounts. Many consumers will likely be placing freezes on their credit accounts. When your sales team encounters these situations, it’s important to be vigilant.
A fraud alert typically lasts 90 days and requires you to verify a consumer’s identity before extending new credit. Fraud alerts are free and consumers can contact any of the three national credit bureaus – TransUnion, Experian, or Equifax – to place one. All three bureaus are required to share it with the others. If something seems suspicious, report any activity to the Federal Trade Commission (FTC) right away.
A credit freeze means that no one (including the consumer) may access that person’s credit report. If someone does place a freeze on their account, it will stay in place until they temporarily lift or permanently remove it. In most states, victims of identity theft are not required to pay for a credit freeze. Others may be charged anywhere from five to 10 dollars.
Be Aware of Scams
Another thing to be more diligent about is being caught in a scam. Be aware of your customers’ histories and take into account the many ways people can take advantage of dealers these days.
Be especially cautious of buyers or scenarios that seem too good to be true. Other red flags could include a person who’s not interested in the car’s color, options, or trim package, who skips a test drive, or who wants to purchase multiple cars. Contact the Federal Trade Commission (FTC) right away if something doesn’t add up.
According to Automotive News, a new type of threat has hit the auto finance industry hard. This fast-growing form of identity theft – known among dealers, but largely unheard of to the public – is called synthetic identity fraud. In this instance, the thief creates an identity using pieces of several individuals. They often recruit straw buyers who look the part of the faked identity to carry out these scams.
Straw purchases can be especially hard on dealers. Some states consider this practice illegal, and may revoke a dealer’s license if they take part in this. However, if a lender does find out about a straw purchase, they have the legal right to pursue the borrower and the dealer.
The Bottom Line
In this age of digital data and identity theft, it’s good to be prepared for any number of scenarios. It can be a thin line to walk between wanting to make a sale and making sure your customers are legitimate. At Auto Credit Express, we can help you walk that line. We will work hard for you, helping to provide quality special finance leads. Our full-service call center can provide customer verification and conflict resolution.
We also have customer-trusted, high-traffic websites, and provide a range of other services from beginning to end. Start growing your business today with Auto Credit Express by calling 888-535-2277, or fill out our contact form and we’ll get in touch with you!