Little Rock, AR., July 28, 2009 – Consumers need to weed good information from the bad when trying to check out the new government ‘Cash for Clunkers’ program that allows some old gas guzzlers to be traded in for a credit on a new fuel-efficient vehicle. The Better Business Bureau (BBB) warns that some con artists are seeking to exploit consumer curiosity about the program.
The program’s full name is the Car Allowance Rebate System (CARS), and the U.S. Transportation Department has a website explaining the program at www.cars.gov as well as a toll-free number, 866-227-7891.
“Fraudsters are using catchy names and trying to lure consumers into identity theft schemes,” said Janet Robb, President/CEO of the Better Business Bureau of Arkansas. “Scams ask for personal information, like Social Security numbers, to help consumers get a ‘voucher’ or have their name added to an application list. But the vouchers don’t exist.”
According to CARS.gov, dealers apply for the program and must be registered to participate. The dealer is the one who gets reimbursed, not the consumer. If the gas guzzler meets the requirements, a credit of $3,500 or $4,500 is taken out of the purchase price of the new vehicle by the dealership. The credit amount depends on the type of vehicle purchased and the difference in fuel economy between the old and new vehicle.
The BBB has the following tips concerning CARS:
· Avoid anyone who offers a money order, check or direct deposit for the rebate. Consumers can only benefit from CARS by getting the reimbursement amount reduced from the purchase price of a new vehicle.
· Discover the current value of the clunker. If it exceeds $4,500, selling the clunker or a normal trade-in may be a more cost-effective route.
· Know the scrap value of the clunker. When the dealership takes possession of the gas guzzler, it may be able to sell specified parts, but the majority of the vehicle must be destroyed. So consumers can negotiate the new vehicle price with the clunker but it will only be worth the scrap value to the dealership. Dealerships are required to give consumers a scrap value estimate.
· According to CARS.gov, the program only works for purchasing or leasing new vehicles from a dealership; not used vehicles.
· Transactions after July 1, 2009, are potentially eligible for credits, however, CARS.gov suggests interested dealers and consumers wait until late July when the program will be fully implemented. The program runs until November 1, 2009, or when funds are exhausted.
· Protect your personal information and understand contracts before signing. When purchasing a vehicle from a dealership get buying tips and a free BBB Reliability Report on the business at www.bbb.org.
Report related schemes at www.cars.gov and internet or e-mail based scams at www.ic3.gov
For more information on buying a car or to check out a dealership, visit www.bbb.org or call 501-664-4888.