NHADA was alerted to a new scam that has shown up recently with New Hampshire businesses. Multiple NHADA members have encountered a scam involving purchasing parts over the phone by credit card.

This is how the scam is performed:

• A person calls and orders parts over the phone with a local name and address.
• The next day, a call is received to cancel the order and the person who requests a refund provides a different credit card than the one used to make the purchase.
• The staff member usually isn’t aware that the original form of payment was a different card and processes the refund.
• The original card provided turns out to be a dead or stolen/fraudulent card.
• The business is then out the money because it refunded the purchase price to the second card. 
  Some order totals have been $2,500 or more!

NHADA encourages businesses to ask questions on all phone transactions; large orders, in particular, should sound the alarm. Remember, you are in control of the situation – try to slow down the process so you can check the valid credit card number. If there are any concerns, call and interview the intended purchaser prior to placing any orders. If a refund is requested, verify that the same card used to secure the purchase is the one being provided for the refund.

Please contact NHADA at 603-224-2369 if you believe you are dealing with a scam or may have fallen victim to a scam.

NADA Releases Updated Fraud Prevention Guide

NADA recently added an update to A Dealer Guide to Preventing and Detecting Fraud to its suite of dealer educational products. Citing statistics indicating that a company will lose 5% of its revenues due to fraud and that the perpetrators are often the company’s own employees, the Driven guide’s authors, Dan Cheyney and Lewis Fisher of Moss Adams, LLP, provide a detailed overview of how fraud may occur in the various departments of a dealership. They describe the internal controls dealerships can institute to help prevent, detect, and correct fraud. The guide also examines related topics, including what to do if you discover fraud at your dealership and important insurance coverage considerations.