There’s a Car in Your Name. But You Didn’t Buy It.
Imagine waking up one day to discover that a criminal living more than 1,000 miles away tried to buy a car in your name. You’d probably think you were still dreaming. But for one Maryland man, this nightmare became a reality when scammers used his stolen identity to try to buy a car — in Indiana [*].
Of all the dangers of identity theft, you probably think it’s unlikely that someone would — or even could — buy a car in your name. But vehicle identity theft is more common than you think.
According to some studies, there were over 5,000 fraudulent car loans between 2019 and 2021, totaling over $1 billion [*]. Even worse, for victims whose stolen identities are used to buy vehicles, it can take months or even years to clear their names.
So, how can you protect yourself from being stuck with the bill for a vehicle you don’t own?
In this guide, we’ll explain how criminals can buy a car in your name and how you can protect yourself from vehicle identity theft.
How Does a Criminal Buy a Car in Your Name?
Vehicle identity theft is a type of financial fraud in which criminals use your stolen identity to either purchase cars or take out fraudulent vehicle loans.
In most cases, the scam follows the same model as other types of loan fraud:
- First, a criminal or unscrupulous family member steals your identity by obtaining Personally Identifiable Information (PII) such as your name, address, and Social Security number (SSN). To get your information, they could use a phishing attack or other online scam, steal your driver’s license, or even buy your information off the Dark Web.
- Then, the scammer uses your PII to either buy a used car or new vehicle outright using your financial information, or to apply for a vehicle loan with a dealership. The rise of online vehicle dealers — such as Carvana, Vroom, and Shift — has made this even easier.
- In some cases, scammers might pay a down payment themselves on the purchase price just to get the vehicle off the lot.
- With the vehicle in their possession, scammers have no reason to keep up with payments. So you’ll be contacted by the dealership or a debt collector who’s trying to track down the stolen vehicle.
In many cases, vehicles purchased with stolen identities are sent to other parts of the country or sold as part of a larger theft operation.
What Happens If Someone Buys a Car In Your Name?
Vehicle identity theft can be a nightmare to untangle.
Until the situation is resolved, you’ll have an extra vehicle listed under your name for which you’ll be responsible. If the thief gets in an accident, doesn't pay tolls, or commits other traffic infractions, you’ll be responsible for the costs.
Even after you spend weeks or months trying to prove your innocence, your personal finances will be impacted in several ways, including:
- Your credit score will be damaged. You’ll be hit with a high debt-to-income ratio along with missed vehicle payments, making it hard for you to apply for loans.
- You’ll have to pay higher auto insurance rates. If the criminal gets in an accident driving your car, you could get stuck with an SR-22 and higher car insurance rates due to being a “high risk” vehicle owner.
- You could be sued for accidents. In the worst scenario, if thieves hurt someone or cause damage while driving “your” car, their insurance providers could come after you as the owner of the vehicle.
- You could lose your license. If an identity thief uses your ID during an accident or traffic stop, you could potentially lose your driver’s license.
To buy a vehicle in your name, a criminal needs to steal your identity. If you see any of the typical warning signs of identity theft, you could be at risk of vehicle identity theft — or worse.
But how will you know for sure that someone has bought a car in your name?
How To Check for Vehicle Identity Theft
- There are new inquiries on your credit report
- You receive a transaction alert from your fraud monitoring service
- Your vehicle’s VIN has been duplicated
- The DMV has you listed as the registrant of a vehicle you didn’t buy
- Your personal information (PII) is available on the Dark Web
- You receive calls from a dealership about a vehicle you didn’t buy
- Debt collection agencies are coming after you for car payments
Look for these warning signs to tell if a criminals has used your identity to fraudulently buy a vehicle:
1. There are new inquiries on your credit report
Dealerships are supposed to check your credit before approving a vehicle loan in your name. If you check your credit report and see unfamiliar inquiries from car dealerships, that’s a red flag that someone has or is trying to buy a car in your name.
You can request a free credit report from all three major credit bureaus — Experian, Equifax, and TransUnion — at AnnualCreditReport.com.
Pro tip: Freeze or lock your credit to prevent criminals from using your stolen identity to buy cars, take out loans, and more. Aura lets you lock and unlock your credit report with a single click. Try Aura free for 14 days →
2. You receive a transaction alert from your fraud monitoring service
Vehicles — whether new or used — are often among the largest purchases you’ll make. While many banks and other financial institutions will flag these purchases as potentially fraudulent, they can still slip through the cracks.
With a fraud monitoring service, you can set transaction limits that will trigger an alert to your phone or online account. For example, you can set a limit of $1,000, which means that if someone tries to buy a vehicle that is worth more than that amount, you’ll be alerted.
Even better, fraud monitoring services can monitor your PII and online accounts for signs of fraud. If you become the victim of identity theft, they’ll let you know quickly so that you can shut the criminals down.
3. Your vehicle’s VIN has been duplicated
Another way that a scammer can buy a vehicle in your name is to duplicate your Vehicle Identification Number (VIN). A VIN is a unique number used to identify your vehicle. If scammers get your VIN, they can use it on a stolen vehicle and register it in your name.
To check if your VIN has been duplicated, use the National Insurance Crime Bureau’s (NCIB) free VinCheck Service. Enter your VIN or upload a photo of it, and the tool will let you know if your VIN has been used by an identity thief.
4. The DMV has you listed as the registrant of a vehicle you didn’t buy
Your state’s Department of Motor Vehicles (DMV) keeps a record of every driver. If you think someone may have registered a vehicle in your name, you can ask the DMV to check for you. They’ll use your name and driver’s license number to search for any unknown vehicles attached to your name.
You can also use the National Motor Vehicles Title Information System (NMVTIS) to receive a detailed state record of a vehicle, including who holds the car’s title. You’ll need to pay to have a report run by an approved NMVTIS data provider.
5. Your personal information is available on the Dark Web
With the rise in data breaches, there’s a pretty good chance that your personal information is available to scammers on the Dark Web.
For example, a stolen driver’s license — which provides enough information for a criminal to steal your identity and buy a car — can go for as little as $20 on the Dark Web [*].
Pro tip: Use a free Dark Web scanner to see if your information is available to scammers. To find out if your personal data has been leaked, these tools check databases and “hidden” sites that hackers use.
6. You receive calls from a dealership about a vehicle you didn’t buy
When scammers purchase or lease a vehicle under your name, they aren’t planning to make the payments. An early sign that you’ve been the victim of car identity theft may be calls or mail from the dealership about overdue payments.
You might also receive other correspondences related to the fraudulently purchased vehicle, such as:
- Proof of ownership of the vehicle — such as a bill of sale, title transfer, or sales tax receipt.
- Information about the vehicle’s warranty and any recalls from the manufacturer.
- Vehicle registration documents, a title application, or transfer of ownership.
- Maintenance coupons or other special deals as a “thank you” from the dealership.
- Follow-up calls from the dealership asking about the vehicle.
If any of these scenarios occur, contact the dealership and ask for information about the vehicle and the sale.
7. Calls or letters from collections agencies
If you receive calls or mail from collections agencies for a vehicle you don’t own, you’ve likely been the victim of car identity theft.
Explain to the collections agency that your identity has been stolen. They’ll most likely need additional information from you before they can remove the debt. But it’s a good idea to get the process started early.
Did Someone Buy a Car in Your Name? Do This
If someone buys a vehicle in your name, you could be on the hook for thousands of dollars and even criminal charges. Here are the steps you should take to minimize the damage and clear your name:
Gather your evidence
The dealership and any debt collection agencies (not to mention the police) will need you to prove that your identity was stolen and used to purchase the vehicle.
Start by gathering any information you have about the crime. This could include:
- Proof of the fraud from the dealership — such as a forged signature on the bill of sale.
- Other signs that your identity has been stolen — such as unfamiliar charges on your credit card or fraud alerts from your bank.
- Copies of your credit report that show fraudulent inquiries.
Keep careful records throughout the recovery process.
For instance, every credit inquiry you dispute will be assigned its own case number that you’ll need to reference. You’ll also want to keep track of whom you talked to and the date you spoke since some disputes may require you to call on multiple days and talk to different representatives.
File a police report
Report the fraud to your local law enforcement agency, and ask to file a police report for identity theft.
You’ll need to give the police as much information as possible, including copies of your credit reports that show the items related to the theft. Ask for a copy of the police report, as you will use this to file an official complaint with the FTC and start the process of disputing any fraudulent debts.
Contact the DMV
Explain what’s happened and ask them to place a “Verify ID” fraud alert on your driver’s license. This will help curb any further identity theft instances in which the criminal uses your license as a form of ID. It will also protect you if the criminal gets in an accident or commits a crime using the vehicle.
While at the DMV, ask for a copy of your driving record to ensure that there aren’t any tickets issued under your name.
Freeze your credit report to stop further fraud
A credit freeze blocks most third parties from accessing your credit (and won’t impact your credit score). This can stop criminals from taking out vehicle loans in your name because a dealership will need to verify your identity before moving forward.
To free your credit, you’ll need to contact each of the three major credit bureaus — Experian, Equifax, and TransUnion — and provide your name, birthdate, address history, and Social Security number (SSN).
Each bureau will provide you with a Personal Identification Number (PIN) that you can use to freeze and unfreeze your credit.
File an identity theft report with the FTC
Debt collection agencies, dealerships, and other lenders will require an official FTC identity theft report in order to prove your innocence.
You can file a report with the Federal Trade Commission (FTC) either online at IdentityTheft.gov or by phone at 1-877-438-4338.
The FTC will collect all the details of your identity theft situation and can create a personal recovery plan for you.
Contact any impacted lenders
If someone bought a car in your name, they probably also committed other types of financial fraud.
Contact any impacted companies or lenders, and inform them of the identity theft. These include:
- The car dealership
- Insurance companies
- Loan companies
- The Social Security administration (if the criminal used your SSN)
- Your bank
Send each of them a copy of your FTC and police reports, and ask them to close or freeze any fraudulent accounts.
Consider signing up for identity theft protection
Aura can help you recover from fraud and even prevent identity theft in the future.
With Aura, you get:
- Financial fraud protection. Aura monitors your credit and bank accounts in near-real time and alerts you of fraud 4X faster than the competition.
- Instant credit lock. Lock and unlock your Experian credit file with one click from your desktop or mobile app.
- Identity theft protection. Aura can alert you if an online account has been compromised, will monitor your SSN for signs of fraud, and can even reduce the amount of spam calls and emails you receive.
- Device and Wi-Fi protection for all your devices. Keep your computer, phone, and home network safe from hackers with powerful antivirus software and a military-grade Virtual Private Network (VPN).
- Family identity theft monitoring for up to five people including children and adults.
- $1,000,000 in coverage for eligible losses due to identity theft. If the worst happens, Aura will be there to walk you through the needed steps to secure your identity and get back on your feet.
Beware of These Other Vehicle Scams
Having a car bought in your name isn’t the only vehicle scam out there. Here are a few other vehicle scams you should be aware of:
- Vin theft and “clone cars.” In this scam, criminals steal your VIN and apply for a bonded title on a stolen car that is a similar make and model to yours. You’ll only find out when you go to sell your car or transfer ownership – and discover that your car is registered to someone else.
- Title washing. Criminals can change a vehicle’s certificate of title to hide previous accidents, disguise a tampered odometer reading, or remove a salvage title. Fortunately, researching the car’s VIN, title status, and title history can help protect you from title washing.
- Car loan fraud “mules.” Another scam involves criminals tricking victims into applying for auto loans. The criminal supplies the “fraud mule” with a fake license, or encourages victims to use their own license to complete the financing process. Unfortunately, scammers often target victims who are vulnerable, like the elderly.
- Online vehicle fraud. Identity thieves can use your stolen information to buy a vehicle online, making it harder for the dealership to identify the fraud. This happened to Corey Bennett, a woman living in Georgia [*]. In 2020, a male identity thief using Bennett’s name secured a new car under her identity by showing a selfie with a Georgia driver’s license. Unfortunately, the real Corey Bennett didn’t discover the fraud until she received a car tag in her mail.
- Auto loan modification fraud. Scammers target individuals who are behind on their vehicle payments by promising to lower their payments — for an upfront fee. Then, they tell the owner to pay them instead of their original lender. But the money goes to the scammer — and not toward the vehicle loan.
Protect Yourself From Vehicle Identity Theft Scams
Unfortunately, many victims of car identity theft will never know how their identity was stolen. Whether a criminal is after your PII to buy a car, take out a loan, or get away with crimes, you need to know how to stay safe.
Here are some of the best ways you can keep your identity safe from scammers:
- Protect sensitive documents. Anything with your SSN or other personal information should be kept in a secure location. For example, don’t keep important papers or vehicle maintenance paperwork in your vehicle.
- Review your credit reports regularly. Check every few months for unfamiliar accounts or hard inquiries into your credit that you didn’t request.
- Monitor your credit card and bank statements. Review your credit card and bank statements, including any accounts that you don’t use frequently. Aura can monitor all your accounts for you and alert you about signs of fraud.
- Keep your personal information safe from online scammers. Use strong passwords, and don’t reuse them. Install antivirus protection on all your devices and computers to help protect your online privacy (including your email accounts).
- If you’re buying or selling a car online, verify all information. Check the title and VIN to ensure the information is legitimate. Be wary of any car ads promoting prices that are too good to be true, especially if sellers claim they need to unload the vehicle fast because they’re going to soon be deployed.
- When buying from individual sellers, ask them to meet you at the DMV. This step allows you to have all documents reviewed by an expert, which can help you avoid a title scam.
- Be wary of vehicle titles that have been recently issued. A recently issued or new title can be a red flag, especially if the title is attached to an older vehicle.
Identity theft and fraud can be devastating. But with the right protection in your corner, you can stay safe online and in the real world.