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Consumer Alert: Title fraud scam exposed

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(3 ON YOUR SIDE) -

One Tolleson man saved up $18,000 in order to pay for a car in full and not have to finance it. So you can imagine his shock when he discovered his car was being repossessed.

“I fell in love with it. It was my dream car, I wanted the Camaro," he said.

Mario Gonzalez says he been saving up a long time to buy the perfect car.

“I worked really hard to save that money for about a year and a half," he said.

After shopping around, Gonzalez says he found just what he wanted on Craigslist, a 2012 Chevy Camaro.

After talking to the seller, Gonzalez negotiated the asking price down to $18,000.  Now, it's important to note that Gonzalez works in law enforcement and says he's fully aware of all the scams when it comes to buying a used car through a private seller, so he took precautions to protect himself.

“Knowing that there are tons of scams out there, and taking all of the reports that I take, to be safe, I told the seller to meet me at the DMV," he said.

That's always a step 3 On Your Side advises consumers to take when purchasing a vehicle from a private party. MVD can then look up the vehicle and tell you if it does, in fact, have a clear title, which is exactly what Gonzalez asked MVD to do before handing over that 18 grand to the seller.

Gonzalez had MVD register the Camaro in his name and with the clear title in hand he drove off.

He was thrilled to have the car he always wanted and was happy knowing he had paid it off in full.

However, two months later, after eating with his family at Peter Piper Pizza, he walked out to find his car on a tow truck.

“And the tow truck driver said it's a repo," he told us.

A repo? Gonzalez paid the seller off in cash. So why was the car being repossessed?

Gonzalez was told he had to call a finance company called American Credit Acceptance for answers.

“They said, 'we're showing a lien for the vehicle;  there's an account for it.' But she didn't want to give me a lot of information. I had a tons of questions. I would ask them and she would just refer me or said somebody would call me back with more information.”

So, 3 On Your Side got involved and we got a hold of American Credit Acceptance (ACA) which immediately looked into the matter.

They told us there was, in fact, a lien on the Camaro with a substantial balance that hadn't been paid, which explains why it was being repossessed.

But remember, Gonzalez had Arizona's MVD check it out and nothing at all showed up. So what happened?

Well, according to the finance company, the State of California where the Camaro used to be registered, is experiencing rampant title fraud.

Apparently, scammers fill out an online form from California's Department of Motor Vehicles, assuring that the car is paid off when it's really not.

California then issues a clean title with no lien, and the car is re-sold to an unsuspecting victim like Gonzalez.

After 3 On Your Side's involvement, American Credit Acceptance dropped the lien and says it will not force Gonzalez to pay the unpaid balance, and will not repossess his car. 

Gonzalez says he's ecstatic knowing his Camaro is his, and says this title fraud issue needs to get resolved.

“What's going on? This needs to stop. We need to find out what's going on so we can fix the problem, not just keep it on the hush.”

A big thank you to American Credit Acceptance for taking the hit on this one and eating that loan. They didn't have to, but they did.

In the meantime, officials with the state of California tell 3 On Your Side that they are aware of this growing scam, and claim to be working on a solution to make sure consumers are protected and have issued the following statement: 

“The California Department of Motor Vehicles (DMV) is committed to combating this fraudulent practice, which will help protect consumers and lenders from this kind of fraud. The California DMV has taken a number of steps to help protect consumers and lenders, such as using automation and improving security methods. The DMV is working to lessen the risk to the lending community while still allowing legitimate transactions to occur.” 

TIPS:
Consumers can help protect themselves by checking the vehicle history using this website: http://www.vehiclehistory.gov/ 
Be careful if a vehicle record shows that the title has been changed several times in during a short period of time. This could be a red flag.

Copyright 2016 KTVK (KPHO Broadcasting Corporation). All rights reserved.


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