Car finance fraud alert
Protect your business – Stay compliant, stay safe
Are you aware of the latest car finance fraud trend affecting dealerships across the UK?
Dealers who ignore the risks could face severe financial, regulatory and criminal consequences. Don’t take that risk.
Latest car finance fraud trend
Third-party “traders” arranging finance through dealers
Some customers colluding with traders in the fraud
Fraud often discovered months later when payments stop or disputes arise
Vehicles often never seen by the dealer – many are suspected ghost cars
What is a ghost car? A vehicle that physically exists but may no longer be in the UK.
Red flags include:
- No MOT despite being over 3 years old
- No insurance records
No MOT despite being over 3 years old
No insurance records
You should have the physical asset in stock.
| The risks to you | Don’t do this | Do this |
| Significant financial loss or even business closure | Do not accept finance applications proposed by third-party traders | Ensure compliance with the new Economic Crime and Corporate Transparency Act (ECCTA) |
| Breach of FCA regulation, risking loss of permissions | Do not fund vehicles you have not physically verified | Have fraud prevention processes in place across your business |
| Criminal liability and possible police involvement | — | Act immediately if you suspect fraud and notify the relevant authorities |
The ECCTA – What you must know
The new Economic Crime and Corporate Transparency Act 2023 sets a higher fraud prevention standard. Failing to comply could mean corporate criminal liability.
Don’t take the risk.
Protect your business – Stay compliant. Stay vigilant.