Car Dealership Credit Report Scams and the Patriot Act

We are continually told by consumers that dealerships are required to run their credit, even sometimes claiming anti-terrorism laws require this! Not true. Some anti-terrorism and anti-money laundering rules require dealers to CHECK THE IDENTIFICATION of customers paying more than $10,000 in cash and to report to the IRS on Form 8300. BUT DEALERS DO NOT HAVE TO RUN A CREDIT REPORT UNDER THESE RULES.

This is part and parcel of a continual dealership scam to get your credit history and information — this empowers them to know all about your finances — information they can use to their advantage. They can also shop for financing, and extra profits for kickbacks the finance companies provide them to mark up the rate on your loan.

If you are a cash buyer or otherwise have your own financing arranged, we advise that you not allow any credit reports to be run. This can harm your credit rating in some instances, and is an invasion of your privacy. Occasionally, dealerships may have access to better financing rates, but you won’t know whether the rate they give you is competitive or has been marked up unfairly unless you have shopped yourself.