One of the most common ways of being caught was with an unsettled HP agreement. In such a case the vehicle is actually the property of the bank and they are entitled to repossess it from you, even though you might have paid a full market related price for it. To a large extent the new NATIS registration system has solved this problem.
How will I know if I have bought a stolen car?
You could insist on the car going for a police clearance certificate. Obtaining such a clearance does not give you any guarantee that it is not a stolen vehicle. SAPS do not hold themselves in any way responsible for any errors or omissions, which could include fraudulent activities within the police clearance unit. In short, there is no guarantee whatsoever that you have not bought a stolen car.
What precautions can I take?
- Check the credentials of the person you intend dealing with
- Get a copy of his ID (Preferably check the original yourself)
- Invest in a “black light” – an ultraviolet device that quickly shows fake ID’s, drivers licences and counterfeit money
- Thoroughly check the history of the car as well as the service books
- Get an AA report
- Do an HPi check
- Don’t accept faxed proof of payments
- Don’t accept photocopied registration certificates
- Insist on a receipt
- Insist on a comprehensive invoice
- If you get a funny feeling that all is not right, walk away from the deal, no matter how far advanced the transaction is.
- Many con artists have a knack of making you feel obligated or behave in an aggressive manner to intimidate you.
- Rather purchase your car from a well established dealer who has integrity and a good reputation.
What about “two in one” cars?
There are some agents who will buy wrecks of cars that have been written off in accidents. They will then use the best parts of the two vehicles to make one complete car. This is what is known as a REBUILD or a CODE 3 vehicle. It is illegal for dealers to sell these vehicles on credit. If you discover that the car you have bought is a rebuild, you are entitled to full cancellation of the transaction. Dealers may sell rebuilds on a cash basis, but they are required by law to disclose that information to you.
The HPi check will usually give an indication of a rebuild, but these agents who deal in this sort of low level trading, can (and frequently do) bribe an official at the traffic department to register the rebuild as a Code 2 or USED vehicle. It might take years for you to discover the truth. Again, my advice is to simply not deal with any shady characters.
What else should I be wary of?
The most common trick is that sellers advertise their cars as one or more years newer than what it is registered as. There is only one official version of the correct date and that is on the registration certificate under the heading: DATE OF LIABILITY FOR FIRST REGISTRATION. Let no-one tell you anything else. Some cars were assembled at the factory in (for example) 2008 but are only sold and registered in 2009 – therefore the year model is 2009.
Some scam artists will sell you a 2008 model and even offer (kindly) to register the car in your name. It might be several years before you actually check the registration certificate, which might read 2007 or even 2006. This is the most common scam so be aware of it. It is no less fraudulent than turning back an odometer.
Cheque fraud is very much on the increase. Beware of buyers from outside our borders. What very few people know that a bank cheque from any international bank (now matter how big or impressive) may be stopped by the drawer at any time within two years! I have no doubt, you can see what levels of fraud that little rule leaves any seller open to. This information obtained directly from Standard Bank Forex Dept.
If you should be approached by a foreign purchaser, rather ask for a telegraphic international money transfer – you will need to supply your bank's SWIFT code(just get it from your bank) to the potential buyer as well as your normal banking details. This is a much safer way of transacting. Imagine selling your car, the buyer leaves the country with it (receipt etc and registration documents on him) and he gets beyond the border, he simply stops payment on his cheque.