Attention: Avoid Fraud Scheme Involving Vehicles Shipped to Greater Chicago Area - Greater Cincinnati Automobile Dealers Association

Attention: Avoid Fraud Scheme Involving Vehicles Shipped to Greater Chicago Area

Originally published in NADA Headlines, June 19, 2018
The Chicago Police Department has requested that NADA disseminate the following information:

We are requesting that motor vehicle dealers throughout the nation exercise extraordinary diligence in verifying the identity of customers who attempt to purchase vehicles via the internet and have them shipped to the Chicagoland area (which includes the city of Chicago, its suburbs, and Northern Indiana). We are seeing an epidemic of vehicles being purchased via identity theft and shipped to the Chicago area from around the country. The vehicles are usually valued at $50,000 or more. The transactions usually start via an internet search. Credit applications and other paperwork are either filled out on-line or sent to the dealership via FedEx after they are requested to be sent to an address in the Chicago area (often times a vacant building). The offenders create a phony email account in the victim’s name as well as a fake driver’s license with the victim’s information, and they use Google Voice or other applications whose phone numbers are not traceable. The offenders oftentimes seek to arrange their own transportation for the vehicles to be shipped.

This is an elaborate scheme that can be stopped if dealerships conduct a thorough examination of on-line loan applications and related paperwork and institute a waiting period before shipping the vehicle. This will help protect both the dealership and innocent persons whose identities are being stolen. In every incident that we have investigated, there are several red flags that the dealership should have caught prior to shipping the vehicle. The Chicago Police Department is fielding at least three requests a week to investigate and recover vehicles that were purchased via identity theft and shipped to Chicago from out of state. In most cases, the credit application was initially approved and the vehicle was shipped. Upon further review of the credit application, inconsistencies were identified and the credit was declined. We have recovered vehicles shipped to the Chicago area from several states including Utah, Florida, Texas, Delaware and Pennsylvania.

If you have questions or concerns, contact: Sgt. Keith A. Blair, Commanding Officer, Chicago Major Auto Theft, Investigative Unit, Central Investigations Division – Unit #606, Chicago Police Department, 3151 W. Harrison St., Chicago, IL 60612 or

NADA Note:  The Federal Trade Commission’s Red Flags Rule requires dealers who offer or maintain consumer credit (including retail installment sale contracts and vehicle leases) and dealers who offer business credit where a reasonably foreseeable risk of identity theft exists to maintain a written Identity Theft Prevention Program that (i) identifies relevant red flags that indicate the possible existence of identity theft, (ii) contains reasonable procedures to detect and respond to those red flags, and (iii) is updated periodically to reflect new identity theft risks.  Information on the full scope of duties is available in NADA’s A Dealer Guide to the FTC Red Flags and Address Discrepancy Rules: Protecting Against Identity Theft.