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Peak Global Management Japan Guest Post: BBB Alert – Watch Out for These Red Flags When Renting a Car
This year, we’ve seen the travel industry partially coming back to life after months of Covid-19 restrictions. Travelers were eager to resume their long-awaited holidays and get to their dream destinations. However, scammers were also on the lookout and more than ready to prey on tourists’ hard-earned money. One of the most frequent tourism-related scams of 2021 has been the car rental scam. Find out more about it.
What made these scams proliferate?
The Better Business Bureau has issued an official alert about car rental scams seeing their surging number. A factor that contributed to these frauds’ success was the impact of the pandemic on car rental companies. Due to months of lockdown, these companies had to severely restrict their activity.
To be able to cope with ongoing business expenses and keep their staff, many companies have sold large parts of their fleet, since most of their vehicles weren’t used anyway. Other car rental companies had to close their doors for good. All these consequences led to a crisis in this sector. Once the leisure and tourism industry was back in business, the demand for car rentals started to rise. However, with fewer companies on the market and smaller fleets, car rental providers started charging more for their service.
The rising prices were seen as a good opportunity for criminals who were ready to trick people by renting cars that didn’t actually exist. Obviously, the internet facilitated the theft since people often rent these cars and pay for them through car rental websites.
How were car rental scams pulled off?
Scammers usually used catchy ads to lure their victims. They posted fake Google and Facebook ads that promised cheap/affordable car rentals. These were obviously terms that drew consumers’ attention, especially on a market that saw car rental prices skyrocket.
Because the entire booking and payment process was carried out online, scammers also had to put a bit of extra effort into creating professional-looking car rental websites. Once a consumer clicked on a fake ad, they were immediately taken to a fake website. For the layperson who was only interested in renting a car at a good price, there were no major red flags related to the website. It advertised a good-looking fleet in a professional manner and there was obviously a contact number and an email address to reach out to the company.
However, at a closer look, customers could have discovered that some of these fake websites lacked any physical address, which is something legitimate companies always provide, as well as terms and conditions, or refund pages.
Interested in closing a good deal as soon as possible, consumers used the available phone numbers, which were often toll-free numbers, and called the car rental company. A customer agent politely answered and started presenting their offering. Not only did they talk about their available cars, but also promised clients a great discount if they agreed to pay an upfront fee.
However, only a few payment options were available, which is another major red flag consumers should be aware of when purchasing products online. Scammers only accepted certain prepaid debit cards or gift cards.
This is rather unusual since most companies accept regular debit or credit cards. However, criminals usually do everything they can to avoid these payment methods because it leaves a trace in the client’s account, one that can help authorities track them.
But given the large discounts at stake, many people agreed to pay the upfront fee using the payment method the scammers required. After buying the necessary prepaid or gift cards, victims were asked to share their PIN, which enabled scammers to drain all the funds from those cards. What came next is the logical consequence of any scam – criminals got their money and stopped answering any call or email.
To avoid similar scams, the Federal Trade Commission (FDC) advises consumers to do their research before renting a car online. This involves searching for the name of the rental companies followed by the word ‘scam’. If the company is not legitimate, something will probably appear in search results. They also recommend renting cars from the companies’ official websites rather than clicking on ads. As a payment method, credit cards are recommended and prepaid or gift cards should always be avoided.
Article courtesy of – Peak Global Management Japan.
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