‘This car is condemned’ Couple ripped off by dealer for £15k car ‘not fit for the road’

Rip Off Britain: Driver discovers previous damage to her car

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Cars that have often been involved in major accidents are not being categorised correctly and then patched up and sold on at dodgy dealers for profit. Thousands of the cars were uncovered by the BBC after an investigation on ‘Rip-off Britain’.

The issue is occurring when rather than being handed one of the correct categorisations after damage has been reported, such as Cat N or Cat S, the cars are simply sold on without labelling.

This makes it incredibly difficult to track a car’s history, in addition to making money for insurance companies and then dealers who buy cheap and sell at a higher price.

One unlucky couple paid £15,000 for a “nearly-new” car with only 56 miles on it from a dealership, only to find that it had previously been in an accident.

It took them over two years to prove this was the case, during which they paid finance every month on the car while it sat unused on their driveway.

Rip-off Britain found evidence of some 2,000 cars which had been overlooked in terms of category, then sold on at so-called “salvage auctions”.

They were then repaired and sold on as quality examples with no recorded damage.

The couple in question on the show was even accused of damaging the car themselves by the dealer, until they asked a specialist to step in.

Eventually accident photos were uncovered showing the car had been patched up before the pair had bought it.

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Ian Ferguson specialises in resolving disputes between buyers who want to reject their cars and the dealers that sold them.

He said: “Usually, there are a number of reasons for a car not being given a category. One is that the engineer to assess the car at the beginning was not qualified to make the decision and that is sadly very often the case.

“The other motivator is money – when a car is classified its value depletes dramatically.

“So anything from 50 to 90 percent of its value may be wiped off depending on the categorisation.

“So by not categorising these cars correctly, insurance companies very often achieve a much higher value for the salvage vehicle than they would ordinarily receive.

“And so they’re simply turning a blind eye to the fact that these cars are then being put back into the repair market.

“The insurance company benefited the beginning from a higher value of salvage so they’re selling these cars on and getting a much higher price than they would ordinarily if it was showing up as a category vehicle.

“But the other benefit is to the unscrupulous traders who actively hunt out these unclassified cars.

“They’re able to sell on cars with a much greater profit margin, because they’re buying them so much more cheaply.”

Mr Ferguson has called for the proper classification of cars and said: “We have a code of conduct that all of these companies sign up.

“They (the Association of British Insurers) need to take a greater interest and who’s applying the rules.

“Because the application of these rules allows people to absolve responsibility, to pass these cars back along the chain without any proper checks being taken.

“So I would like to see the people who are involved with compliance the insurance companies involved in the writing process rather than just being an engineering department or a

Claims Department who really in many cases don’t have the experience or the training or the qualifications to do such a task.”

The ABI said that it had created the voluntary salvage Code of Practice, under which write-offs are assessed by a qualified vehicle damage expert who decides if it needs to be scrapped.

Anyone unhappy with the assessment can ask an insurer to make sure that the code was followed. And the ABI said that while the code is voluntary, it shows that insurers are committed to protecting consumers.

But they did point out this only applies to damage vehicles where an insurer has been involved.

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