Car buyers cautioned about finance fraud risk
Personal insurance
27th May 2010
There is a risk that those selling a car or arranging finance for a vehicle may commit serious crimes and not realise they are doing so, one organisation warns.
According to the Finance and Leasing Association (FLA), many UK insurance policy customers are not aware that there are severe penalties attached to providing false information in such cases.
Figures from the company indicate there were almost 2,500 fraudulent requests for motor finance logged during the first quarter of this year alone, while conversion fraud - where cars are sold with loans outstanding - numbers were also high.
According to the FLA report, the total value of such applications reached £126.8 million during the 12 months to the end of March, although "rigorous checking" by finance companies reduced the number of actual cases from nearly 10,000 to 960.
Despite a year-on-year fall in incidents, the body's head of motor finance Paul Harrison said: "It is vital that consumers are made aware of how fraud could affect them."
British drivers are ordering more vehicles, as latest figures from the Society of Motor Manufacturers and Traders demonstrated a 44 per cent rise in car production during April 2010.
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