Auto Dealers Are Major Targets for Identity Theft Scams

Since automotive dealerships deal in high priced transactions they are a huge target for identity theft scams and need to protect themselves accordingly. Businesses in America lose more than $56 million each year due to identity theft and the number continues to rise. In order to protect their company from identity theft, automotive dealerships need to take a two-pronged approach to reduce it. They need to become educated on how this theft takes place and they then need to take necessary action to prevent it.

How Does It Happen?

Auto dealerships have weaknesses in their businesses that they must understand before the necessary steps to stop it can be taken. A person purchasing a vehicle must be properly identified. A glance at a driver’s license or a call to a credit company is simply not enough. This is a well known weakness of auto dealers for criminals and it’s the most important reason protection from identity theft is so important. This circumstance puts the dealership at risk in two ways.

The first way is obviously making the sale of an expensive vehicle to a customer that is not who they say they are. Some sales representatives care more about making the sale and if red flags arise they simply wave them away. There are times when a check of the credit will remind the sales person to confirm the identity of the purchaser. Regrettably a lot of sales people believe all that is needed are a few forms of identification.

Would be criminals are well aware of these facts so they ensure they politely offer several different types of counterfeit identification. Automotive dealerships need to ensure they are protected from identity theft even after a fraudulent buyer is long gone. This is about the time that the second person in this scenario, the victim of the identity theft, will come bursting into the dealership and demand that the sales contract be terminated immediately. The dealership may not only be out of a vehicle but they may also need protection from a potential lawsuit that the identity theft victim may file.

How to Be Protected

Identity theft protection for automotive dealers needs to be in place from the point of purchase. Smart ID software is a program that is highly recommended for good reason. It enables the dealer to confirm the actually identity of the person in front of you and not just authenticate the forms of identification presented. Each person has a unique background and this software will set up a personalized question set based on that background. The questions presented can only be answered by the actual individual. Although this form of identity verification may be a bit more time consuming it is well worth the investment.