With spring sales events and Memorial Day weekend deals, vehicle purchases tend to spike as the weather gets warmer. But before you head to the dealership, keep in mind that the latest hot deal could come with an unexpected price tag: identity theft.
As we’ve noted before, identity theft can happen anywhere — at restaurant point-of-sale devices, at hacked ATM machines, while making purchases online, etc. Car dealerships, however, can be especially rife with theft opportunities, mainly because of common dealer practices that inadvertently put consumers at risk.
For example, to do a test drive, you need to hand over your license, which the dealership copies or scans. Driver’s license fraud is a growing issue, because that one piece of identification can give a thief enough information to create a fake ID for use in opening credit accounts.
Also, dealerships tend to pull credit reports in order to determine financing options. These reports contain a wealth of information, including your Social Security number, details about your credit card account (e.g. spending limit and money owed), address, date of birth and other data that can easily be used for identity theft.
If you’re planning a trip out to your local dealership, consider these steps to protect yourself from identity theft:
- Before a test drive, ask for your license to be photocopied rather than scanned into a computer. Once you return to the dealership, request the original copy. (Dealerships often prefer to keep a copy of your license for future use as a sales lead.) If the dealership tells you all copies are destroyed as a matter of policy, let them know you’d like to watch it get shredded.
- For an extra measure of security, consider putting a sticker on the license’s magnetic strip so it can’t be used on a card reader.
- When talking about financing options, have a frank discussion about your identity theft concerns and ask about their data-retention policies. If credit reports are kept in an unlocked filing cabinet, for example, you should think about visiting another dealership.
- Take a look at what type of information is listed on your purchase documents, especially any documentation (e.g. registration) that must be left in your new car. These documents may include your Social Security number. Understand that keeping these documents in your car can present a risk if your car is ever stolen (or even if it is borrowed). Talk to the dealership about obtaining proof-of-purchase documents that include a minimal amount of identifying information.
- Take notice if you receive any communication from a dealership about test drives you didn’t take or visits that didn’t happen. Car dealerships have become prime targets for identity thieves with fraudulent IDs, who sometimes attempt to purchase cars using stolen information.
Identity theft concerns shouldn’t prevent you from taking advantage of major spring sales — but give yourself an extra layer of protection by guarding against driver’s license fraud and other risks.
Image courtesy of Flickr user Emilio Labrador.