Repossessed cars scam

There have been reports of a new scam circulating involving repossessed cars being reported as stolen. It is not yet clear if insurance companies have caught on to this or even if all of them are aware of it.

During these last few years, drivers and car owners have been left feeling the pinch after inflation soared and the country entered into the worst recession ever in history. The majority of people getting to work or even doing weekly grocery shopping rely on their cars for transport. When many car manufacturers went bankrupt or were taken over by other companies, many people thought that this was the time to snap up a bargain. Whilst many people got a good deal on the motors, many had to take out a loan either with a bank, loan company or car dealer/manufacturer. When many of these new car owners or their partners were made redundant, they couldn’t keep up with the finance loan on the cars, so in turn they were repossessed legally by the financier.

How the scam works for repossessed cars?
When the finance company has had enough of excuses and months of defaulted payments, they will send round people from a company that specialises in repossessions (anything from cars to personal items in the home) to recover their loss. When the debtors arrive to take away the car, some cheeky chaps have decided to start the scam where they call the police to report the car was stolen. After receiving the police crime number, the car insurance provider is notified. In this case, the car insurance company should carry out checks to make sure that there is no outstanding finance on it and it costs no more than £5 for this service. Instead, after waiting a while to see if the police find the car, the insurance company pays out for the current value of the car.

What is not clear is if the driver of the vehicle trying to scam the insurers doesn’t work out what happens next? I suppose they could get charged with fraud for trying to get money for a vehicle that isn’t actually theirs to begin with. This is another reason as to why insurance premiums are rising; all of these new fraud scams involving car insurance has a knock on effect. In this case, it means that car insurance companies are losing more money each year to due fraud so have to put up their prices to recover losses. If you suspect anyone of carrying out such scams, then report them as soon as possible as this sort of behaviour is not acceptable.