Car buyers warned of finance fraud

Car buyers and sellers are being warned of finance fraud.

New figures from the Finance and Leasing Association (FLA) show some 2,500 fraudulent motor finance applications were made in the first quarter of 2010.

And in the year up to March, there were nearly 10,000 fraudulent attempts to obtain motor finance providers, collectively worth £126.8 million.

The FLA warned many people may not know they are committing a serious crime by providing 0 information in a finance application or selling a car which has outstanding finance.

While there has been a slight decline (3%) in fraud in the first three months of this year, compared with the same period 12 months ago, the figures show that a large proportion of fraud cases may be committed unwittingly by car buyers.

Almost a third of motor finance fraud (30.8%) in the past year was application fraud where a customer - sometimes unintentionally - gives incomplete or inaccurate information to a lender.

Paul Harrison, head of motor finance at the FLA, said: "If people fail to disclose their credit history during the application process or try to sell a vehicle that is still on finance, they are committing fraud against their lender and may have their car taken from them."

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