How to Maneuver Troublesome Car Warranty Scams

Elder Protective Services’ Advice on how to Steer Clear of Car Warranty Scams Targeting Seniors

When searching online for information about your car’s warranty, you are more likely to come across a series of memes or a robocall removal form than actual facts about that warranty. The phrase “We’ve been trying to reach you about your car’s extended warranty” seems to perpetually harass car owners, and even those seniors without vehicles. The remark itself can stir one’s worst fears and anxieties as it reminds of potential engine failure, transmission concerns, cracked air conditioner unit, and other expensive repairs.

Some extended warranties, or extended service agreements- like the one you signed at the dealership-, can be everything you would hope, brake cable and transmission service for the life of the car or better! These service agreements can be helpful in protecting both your bank and your peace of mind. But more often than not, extended car warranties can be dangerous scams targeting seniors in order to financially exploit them.

Amy Nofziger, Director of Fraud Victim Support for AARP, notes that the Car Warranty Scam is the most reported robocall scam to the FCC. AARP has created The AARP Fraud Watch Network Scam-Tracking Map which reveals scams reported in a specific area in real time. This Scam-Tracking Map helps bring awareness to seniors around the United States.

Elder Protective Services always suggests awareness as the first step of protection. Below we discuss common extended warranty, or service agreement, scams, their warning signs and red flags, and how to protect yourself and others against them.

Car Warranty Scams

According to the FCC, a car warranty scam is similar to the government imposter scam in so much that a con artist poses as a “a representative of an insurer, manufacturer or car dealership.” The scammer uses this credible disguise as an attempt to build trust. Once there is mutual respect between both parties, the fraudster uses pressure tactics to convince the elder to renew or extend their car warranty. This type of scam can happen through the classic snail mail, email, or text. The most common method is through a call.

The FCC warns elders that there are two potential reasons for scammers to contact seniors with a Car Warranty Scam:

• Option 1: The con artist wants to “sell” the senior something disguised as an extension to a car warranty or other service agreement. In this scenario, the scammer will collect an annual or monthly fee from the unsuspecting victim for the extended warranty. When the victim needs to use the warranty for a replacement or repair, they realize the extension was a scam and have lost their money.
• Option 2: Other scammers use the Car Warranty Scam as a front to collect personal and private information from elders. After the con artist has convinced the unsuspecting victim to invest in an extended warranty or service agreement, the elder is sent to complete an online form that requests personal information, such as vehicle registration, bank account or credit card details, and even Social Security Numbers. If the victim unintentionally provides this sensitive information, scammers can obtain thousands of dollars through identity theft.

Advice from Elder Protective Services: Do not give into high-pressure tactics. These are meant to scare you into providing your sensitive information to a hacker.

Con Calls: 

In a recent survey, 67% of motor vehicle owners in the United States have received a robocall about extending their car’s warranty. 31% of those surveyed had been contacted via phone within the week. According to call-blocking service RoboKiller, auto warranties are the most common subject of phone scams. Robokiller estimates nearly 13 billion scam calls regarding extended car warranties in 2021, which accounts for roughly 18% of all reported and/or blocked scam calls.

“It’s statistically possible that every American with a smartphone will receive more than one of these calls during any given year.” – The Robokiller Report, Phone Scam Insights

Though car extended warranty calls have become more credible sounding over the years, generally these scam calls are easy to identify. An unsuspecting victim will likely hear an automated message at the beginning of the call stating “Your car warranty is expiring soon.” Then the message prompts the victim to press a button or stay on the line to speak to a representative. This representative will then use pressure tactics to convince the victim to register for an extension.

Alex Quilici, CEO of YouMail, explains that when you purchase a car, you likely sign or check a box that states you would like to be contacted with information about the car itself or related products. Quilici claims that the dealership typically weeds out third-party warranty calls. However, robocalls are sent to all vehicle owners. “The warranty calls exist because they’re really easy to do and they work,” he explains. “Most of them are designed to sell people some sort of extended service contract (not a warranty) and use illegal robocalls as a form of lead generation.”

Advice from Elder Protective Services: The easiest way to protect yourself against robocall scams is to simply hang up when you hear the automated message about your “car warranty.”

Fake Fliers:

In addition to robocalls or automated messages, scammers mail out fake warranty expiration notices designed to mimic a manufacturer or state motor vehicle bureaus’ notice. These fliers also use pressure tactics with loaded language, such as:

• TIME SENSITIVE
• PLEASE CALL IMMEDIATELY
• Request for Immediate Action
• ** IMPORTANT**
• 2nd Attempt
• FINAL NOTICE

Some of the fliers are vague and simply addressed to “vehicle owners.” Others are actually addressed to the potential victim. The phony notice will include a toll-free number for unsuspecting elders to call. This number will connect the victim with the impostor representative, who will explain the benefits of the extended warranty and the dangers of not extending. The scammer employs scare tactics that prey on the victim’s fears and anxieties.

Review the example fraudulent notice below. Do not engage with any unexpected notices that mirror this example.

TIME SENSITIVE YOUR VEHICLE’S FACTORY WARRANTY MAY BE ABOUT TO EXPIRE OR HAS RECENTLY EXPIRED BASED ON AGE OR MILEAGE. NOTIFICATION DEADLINE: 12/30/2022 Victim’s Name, This is our second attempt to inform you that the factory warranty on your 2007 Acura may have expired or is about to expire. PLEASE CALL WITHIN 5 business days. Call to confirm your receipt of this notification as soon as possible. If you go without coverage, you will be responsible for all repairs in the event of a breakdown. CALL IMMEDIATELY 1-877-555-#### HOURS: Monday – Friday 8:00 a.m. – 7:00 p.m. CST Saturday 9:00 a.m. – 2:00 p.m. CST

Advice from Elder Protective Services: If you receive a notice in the mail that uses “loaded language” DO NOT call the provided number. Instead contact the dealership you purchased the vehicle from or the manufacturer directly.

Suspicious Text Messages:

Some seniors have reported receiving text messages regarding their car’s extended warranty. The text message car warranty scam operates the same as a robocall or mail notice. The scammer attempts to lure the victim through fear or pressure tactics. Text message scams are particularly dangerous because an elder may accidentally click on a provided link and unintentionally download malware on their computer or smartphone. If you receive a text message that reads similar to the following examples, delete the message, report the sender, and block the number.

The Red Flags

Although each call, nortice, or text message may seem different, there are several warning signs that indicate that the car warranty communication is fraudulent or the scenario is potentially dangerous. If you feel that you have experienced a car warranty scam, use the steps below to report to the appropriate authorities.

• IMMEDIATE ACTION: A tell-tale sign that a notice is phony or a call fraudulent is the use of loaded language. A car warranty communication might be a scam if the call or mailing says it is important for you to take immediate action to continue your car’s warranty coverage.
• Pressure or Scare Tactics:  Scammers often create a fake sense of urgency to persuade potential victims to sign the extension right away. These pressure tactics can make elders feel helpless and uncomfortable, thus more willing to give into the scammer’s demands.
• An Outside Company:  If an outside company offers to extend the factory warranty, the communication is a scam because only the vehicle’s manufacturer can actually do that.
• Vagueness: Although a call or notice may use important details to garner your attention, such as the year, make and model of your car, the call overall is vague. The scammer may include unclear information about what services that warranty covers and for how long.
• Prompted to Provide Personal Info: Any automated message about an extended car warranty or service agreement that requires you to enter personal information before you can speak to someone is definitely a scam. Hang up if you are prompted to provide your social security number, credit card number, bank account number or other personal information.
• Threats and Tricks: Any type of threat is a clear indicator that a communication is fraudulent. If you feel threatened at any point in time during a phone call, disengage. A legitimate organization does not operate their business that way.

Protect Yourself Against Car Warranty Scams

AARP advises seniors to protect themselves or loved ones from Car Warranty Scams by:

Installing a call-blocking app on your smartphone.

• Such apps use reports from users, the Federal Trade Commission (FTC) and other sources to predict which calls are likely scams or spam.

Attaching a call-blocking device to your landline.

• These devices can block numbers of known scammers and weed out robocalls by prompting callers to press a number to continue.

Research.

• Research a company offering extended coverage — for example, check the Better Business Bureau listings for complaints — and carefully read the fine print on any contract to see exactly what it covers and how long it lasts

Check With The BBB.

• The Better Business Bureau only gives A+ ratings to the companies that follow strict good business guidelines. If the company you are dealing with has a bad rating or no rating at all, you might consider trying another provider.

Contact your Dealer Directly.

• Check on anyone who claims to be calling from the dealership where you bought your vehicle. Hang up and call the number listed on the dealer’s website or the purchase paperwork.

Check the Expiration Date.

• Check the expiration date for the manufacturer’s warranty and the terms for extending that coverage before you consider buying coverage from an outside provider.

Use FTC’s National Do Not Call Registry.

• Put your phone numbers on the FTC’s National Do Not Call Registry. Legitimate companies won’t call you if you’re on the registry unless you’ve specifically authorized them to do so, so you’ll know an unsolicited car-warranty call is almost certainly a scam.

Let it go to voicemail.

• Don’t answer a call if you don’t recognize the number.

Don’t Trust Caller ID.

• Don’t assume a call is safe because the caller ID shows the name of your vehicle’s manufacturer or something like “auto warranty department.” Scammers can use spoofing tools to display whatever name or number they choose as the caller ID.

Don’t Respond!

• Don’t follow instructions to press a number on your phone to avoid future unwanted calls or reply to text messages to “opt out.” Scammers do this to confirm they’ve reached a working number they can call again.

Delete and Block.

• Instead, delete the message and block the number.

Steps to Report Robocalls and Car Warranty Scams

If you were the victim of a Car Warranty Scam, report it to the Federal Trade Commission. The FTC is responsible for protecting consumers and their personal information. The FTC cannot resolve individual complaints, but they provide individualized next steps.

Report auto warranty scams to the Federal Communications Commision and your state’s Attorney General.

File a complaint with the IC3. The IC3 is the Internet Crime Complaint Center, a government agency that makes it easy for individuals to report a crime that takes place online. They work with the FBI and local authorities to help manage and solve internet scams.

If you provided your financial information to a car warranty specialist or representative, contact your credit card company. Report any unauthorized charges or if you think a scammer stole your credit card number. Each credit card company will provide additional next steps.

If you believe you unintentionally gave your personal information to a scammer, go to IdentityTheft.gov for steps you can take to protect your identity.

Utilize AAA’s online checklist for what to look for in a vehicle service contract.

Daniel Klibanoff, an advocate for seniors, is currently serving as the President and CEO of Multimedia Lists, Inc. Daniel is also the founder and director of Elder Protective Services, an enterprise aimed to serve and protect elders. Learn more at https://elderprotectiveservices.org/