The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Auto dealers yesterday warned that Bahamians will increasingly fall victim to vehicle import scams unless the authorities crack down to end the regulatory “Wild Wild West”.

Ben Albury, the Bahamas Motor Dealers Association’s (BMDA) president, told Tribune Business that scams involving used Japanese vehicles are “very common” and have been occurring “for years and years and years” after the Consumer Protection Commission issued an alert over “a significant increase in fraudulent activities” relating to such imports.

The Commission’s alert, issued yesterday, disclosed that in the latest scheme “Bahamian consumers have been targeted by scammers purporting to be legitimate representatives of Japanese vehicle importers”. Those who have fallen prey to it have suffered “significant financial losses and unavoidable ownership disputes”.

Bahamians are being induced to acquire used Japanese autos via local agents or middlemen, paying 50 percent of the purchase price upfront and the balance when the vehicle arrives in this nation. Upon payment of the 50 percent deposit, confirmation that the vehicle has been shipped and the bill of lading are provided to the buyer, and everything seems fine.

However, the Commission alert said that, while en route to The Bahamas, the agent/middleman then sells the same vehicle to other or multiple buyers. The end result is that, when the vehicle arrives in The Bahamas, shipping companies are immediately faced with multiple competing ownership claims to it, resulting in disputes and financial losses for many involved.

Explaining how the scam operates, the consumer watchdog said: “Consumers purchase a vehicle or vehicles from a local dealer, who promises to import with an agreed 50 percent deposit and with the understanding that the 50 percent balance is to be paid upon the vehicle’s arrival in The Bahamas.

“Once the 50 percent deposit is paid, the vehicle(s) is/are then shipped, and the buyer receives the shipping confirmation along with a copy of the respective bill of lading. During transit, the vehicle(s) is/are then sold again to another buyer or multiple buyers in The Bahamas.

“After the vehicle(s) land(s) in The Bahamas, all parties having a legitimate interest in the same vehicle(s) present themselves to the respective shipping companies claiming ownership, consequently creating disputes and ultimately resulting in substantial financial losses.”

Mr Albury, upon being informed of the alert, told Tribune Business such scams are nothing new and he has dealt with countless victims over the years. He added that a quick remedy would be to crack down on, and enforce, the requirement that anyone importing more than two vehicles per year be treated as a dealer and required to register as a business and pay taxes accordingly.

“I can tell you that for years and years and years I’ve had people come into me who have purchased pre-owned Japanese vehicles and have been scammed,” the BMDA president revealed. “They’ve given a guy a deposit. A lot of times these are people who they know, have had face-to-face contact with, and have spoken to. Some of them claim to know these people at some level.

“It’s a very common scam. It happens with Japanese vehicles primarily because we import the bulk of our used vehicles from Japan. I’ve seen schemes from people claiming to be car importers. The system is so unregulated. This goes back to us agitating for years for used car dealers or any dealer to have a Business Licence.

“If you import more than two vehicles per year with the intent of selling them then you are a car dealer. If those people have to register their business they will operate under the same scrutiny and same requirements as we are made to, and that will help to cut down on the amount of fraud,” Mr Albury added.

“If you have a registered company, the Government will have an address, have information, and have an up-to-date Business Licence. At present, it’s the Wild Wild West. If the Government made people set up legitimate businesses it would be much more challenging for those people to commit fraud.

“But, because it’s the Wild Wild West, anyone can call themselves a vehicle importer, import 15, 20 or 30 cars a year, without paying Business Licence, without paying VAT, without paying National Insurance Board (NIB) contributions. At least you should have a store front.”

Mr Albury added that, under the present system, it was too easy for vehicle scammers to “change their phone number, change their address” and simply disappear with no recourse for defrauded consumers to get their money back.

“I feel terrible when people come to me with their stories because I can tell they don’t have the money to lose,” the BMDA chief said. “What is the effect this is having on some of those people who save and scrounge to buy these vehicles and think they are doing the right thing? It’s discouraging. It should not be allowed to happen.

“I see people who buy vehicles only to later find they were written-off, in an accident or have some sort of liability. You go back to the guy the next day, you’re not getting your money back. You’re not getting resolution or any type of recourse. It’s not going to happen. It’s nothing new; it’s the same old song and dance. The warnings are fine, but don’t get to the root of the problem.”

Brent Fox, Montague Motors’ principal, told Tribune Business that while he was unaware of the scam detailed by the Consumer Protection Commission it came as no surprise. “I haven’t heard about anything specific, but these people doing the frauds are likely already getting the lion’s share of the market,” he said.

“No, it doesn’t surprise me. That’s been one of our main concerns; individuals that are bringing in multiple vehicles and selling them on the side of the road and not paying their dues. I haven’t head anything about individuals selling the same vehicle to multiple parties; not specifically, but it doesn’t surprise me.”

The Consumer Protection Commission yesterday urged Bahamians to protect themselves against such scams by ensuring that payments for vehicles are made to corporate, rather than personal, bank accounts. It also called on consumers to only deal with legitimate companies and “reputable providers of goods and services” as a further safeguard.

“Always use secure payment methods and consider third-party escrow services,” the Commission advised. “Do not remit payments to accounts of individuals. Always ensure that payments are sent to the corresponding company’s bank account.

“Keep all receipts and a detailed record of all documents, transactions and communications for at least six months before discarding. When in doubt, ‘check it out’ or ‘cancel it out’. If a purchase seems too good to be true chances are it is a scam. Fact check everything before making payment on any goods or services.”