Cracking down on dodgy second

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In the last financial year, inspectors from South Australia’s consumer watchdog, Consumer and Business Services, inspected nearly 170 licensed used car dealers operating both from home and in car yards.

And while the majority of car yards were doing the right thing, there has been some concerning trends emerge.

We have investigated a number of licensed dealers selling from home under the guise of being a private seller to avoid their legal obligations such as providing a statutory warranty, failing to disclose whether a car was a repairable write off and not disclosing that they are a licensed dealer.

Second-hand vehicle dealers must have a licence if they buy, sell or offer for sale four or more vehicles in 12 months.

As a result of proactive monitoring, CBS also identified a significant number of unlicensed dealers selling from home via sites such as Facebook Marketplace.These operators try to deceive consumers by winding back odometers or faking logbooks to make it seem like the car has travelled fewer kilometres to maximise their profits.

Over the last financial year, a total of six individuals were convicted of tampering with odometers, getting slugged a total of more than $35,000 in fines and compensation orders. In addition, one of the six was also handed a suspended jail sentence for falsifying logbook records.

Of those prosecuted, four were unlicensed. Two were licensed dealers caught winding back odometers.

As a result, over the coming year Consumer and Business Services will be targeting inspections at licensed dealers operating from home and continuing to monitor for shonky unlicensed sellers to stamp out those backyard dealers who do the wrong thing.

The Government has also recently undertaken targeted consultation on the introduction of harsher penalties for unlicensed dealing and odometer tampering including significant increases to fines and longer jail terms. The results of this are now being considered.

We encourage people to report any vehicle dealer – licensed or unlicensed – who they suspect of dodgy behaviour to Consumer and Business Services.

For images of dodgy second-hand car sale prosecutions

As cost-of-living pressures continue to bite, many people are turning to second-hand car sales as a more budget-friendly way of purchasing a vehicle.

And while most licensed dealers do the right thing, there are unscrupulous operators out there who’ll try to take advantage of consumers.

It’s appalling behaviour, which is why we are continuing to target this area to better protect consumers.

When buying privately, exercise a great degree of caution – get the car inspected, check the odometer reading to see if the wear and tear on the car is consistent with the car’s supposed usage and visit the Personal Properties Securities Register to check that money isn’t still owed on the car.

If you’re buying from a licensed dealer, consumers have certain rights and protections. A licensed dealer must disclose when a vehicle is a repairable writeoff and must provide a written contract outlining the terms of the sale including any statutory warranties applicable to the vehicle.

But some licensed dealers who operate from home have been trying to avoid adhering to the conditions of their license.

This is wrong – if they have a licence, they have to live up to the terms of that licence, regardless of where they’re selling.

Failure to abide by these requirements gives them an unfair advantage over those operators who do the right thing.

If you have any concerns, contact Consumer and Business Services for advice and support on 131 882.

Dodgy private sellers are preying on those who can least afford it.

The strong message is to go to a licensed dealership where motorists legally have consumer protections and warranties.

My own son wanted to purchase a car from Facebook Marketplace which when inspected required over $6,000 worth of repairs and was unsafe to drive.

DateTrader (where applicable)Action2/9/22Sokwanna Touch (jointly charged)Unlicensed dealer, wound back odometer on Subaru Forester from 348,000 to 164,490 before sellingCourt outcome: Convicted and fined $7,000.

2/9/22Puthear Som (jointly charged)Unlicensed dealer, wound back odometer on Subaru Forester from 348,000 to 164,490 kms before sellingCourt outcome: Convicted and fined $7,000.

22/12/22Mohammad GhaffariBought Toyota Sportivo for between $1,000 and $2,000, wound back the odometer from around 270,000 to 121,906 kms before selling for $8,500, bought written off Toyota Prado for $4,250, wound back odometer from 387,850 to 166,503 kms and falsified a logbook before selling for $25,000Court outcome: Convicted and fined $4,200. Suspended sentence of 2 months 24 days and good behaviour bond of $100 for 12 months.

2/3/23Ravindra MudaligeBought Holden Astra for $500, wound back odometer from 170,000 to 96,000 kms and falsified a logbook before selling for $4,900Bought Mitsubishi Pajero for $22,500, wound back odometer from 307,000 to 160,000 kms before attempting to sell for $38,000Court outcome: Fined $3,000.

Compensation awarded totalling $2,400.1/5/23Salameh HadaddLicensed dealer. Bought Holden Commodore for $6,830, wound back odometer from 256,416 to 190,000 kms before selling for $7,700Bought Subaru Forrester for $4,009, wound back odometer from 282,627 to 182,360 kms and attempting to sell it for $7,000Court Outcome: Convicted and fined $450.

Compensation awarded totalling $4,400.24/5/23Arta HanssenLicensed dealer. Bought Nissan Xtrail for $6,402.00, wound back odometer from 219,694 to around 167,000 kms before selling for $9,900.Bought Holden Captiva for around $2,000 wound back odometer from 205,419 to around 164,000 kms before selling for $9,800Court Outcome: Convicted and fined $1,800. Compensation awarded totalling $5,372.