[SCAM ALERT]: Multi Credit Card Parts Order Sounds Alarm

Written by NHADA | Jun 23, 2022

NHADA was alerted of a new scam that has shown up recently with New Hampshire businesses. Multiple NHADA members have encountered a scam involving purchasing parts over the phone by credit card.

This is how the scam is performed:

A person calls and orders parts over the phone with a local name and address.
The next day a call is received to cancel the order and the person who requests a refund provides a different credit card than the one used to make the purchase.
The staff member usually isn’t aware that the original form of payment was a different card and processes the refund.
The original card provided turns out to be a dead or stolen/fraudulent card.
The business is then out of the funds because they refunded the purchase price to the secondary card. Some order totals have been $2,500 or more!

NHADA encourages businesses to ask questions on all phone transactions, large orders, in particular, should sound the alarm. Remember, you are in control of the situation — try to slow the process down so that you are able to check the credit card number is valid. If there are any concerns, call and interview the intended purchaser prior to placing any orders. If a refund is requested verify that the same card used to purchase is the one being provided for the refund.

Please contact NHADA at 603-224-2369 if you think you are dealing with a scam or may have fallen victim to a scam.

NADA Releases Updated Fraud Prevention Guide
NADA recently added to its suite of dealer educational products an update to A Dealer Guide to Preventing and Detecting Fraud. Citing statistics indicating that a company will lose 5% of its revenues due to fraud and that the perpetrators are often the company’s own employees, the Driven guide’s authors, Dan Cheyney and Lewis Fisher of Moss Adams, LLP, provide a detailed overview of how fraud may occur in the various departments of a dealership—and they describe the internal controls that dealerships can institute to help prevent, detect, and correct it. The guide also examines related topics including what to do if you discover fraud at your dealership and important insurance coverage considerations.

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